Invest 30 billion won! South Korea's second-hand trading market continues to be hot

It is reported that South Korea's Lotte participated in the transaction of establishing a private equity fund (PEF) as a financial investor (FI) to acquire shares in Used Nara.

As we all know, Lotte Shopping Co., Ltd. invested 30 billion won in the main body . Used Nara is the largest second-hand trading platform in South Korea. It started with Naver Cafe in 2003 and expanded its business to mobile applications.

According to Used Nara, the number of monthly users (MAU) reached 1.72 million in January, more than double the 84 million in January 2019. As the number of users increased, the transaction volume of second-hand goods in the country also exceeded 5 trillion won last year.

Lotte is expected to build a regional platform covering both online and offline by linking stores nationwide with second-hand countries. As a result, it is expected that the 13,000 offline stores operated by Lotte Group will be used as a second-hand trading base.

Last August, Lotte Mart introduced the non- face-to-face second-hand trading service "Parabara" in three stores nationwide. The service was launched in the form of a vending machine. In other words, it provides an opportunity to visit physical stores through second-hand trading.

Lotte Group's comprehensive online mall "Lotteon" is an open market, so it is expected to achieve online expansion through the connection with Used Nara. An industry insider said, "Cash Supermarket is not a core project for second-hand transactions, but one of the main services operated to build a regional basic platform. "

However, second-hand transactions are still direct transactions and cash transactions, which is a weakness in terms of long-term earnings.

Experts predict that this can be solved through data exchange between the two companies. Professor Kim Ik-sung of Dongduk Women’s University said , “I hope Lotte can improve its weaknesses through Used Nara and see it as an opportunity to expand its customer base. Used Nara can also overcome management problems through the experience accumulated by the Lotte Group in the distribution industry.”

Large distribution companies, led by Lotte, are expected to enter the second-hand trading business in earnest. In addition to entering the business immediately (such as Lotte's acquisition of Second-hand Country) , it is likely that it will be adjusted to link food and second-hand trading so that it can serve as a future growth engine . Some companies are expected to try to enter the market by establishing strategic alliances with startups that have already made an impact in the second-hand trading market.

South Korea

Second-hand market

Lotte