Lotte chairman returns to shopping division to revamp retail business

Reshuffle to boost company’s retail market competitiveness

By Ko Dong-hwan

Lotte Group Chairman Shin Dong-bin has returned to his former role at the conglomerate's shopping division to strengthen the group's competitiveness in the retail sector at home and abroad.

At a board meeting on Monday, Lotte Shopping's directors approved a motion to reappoint Shin as the new chief executive following the company's shareholders' meeting in Seoul earlier that day.

This marks Shin's return to the position after a 12-year absence.

With Shin's return, Lotte Shopping now has four CEOs, including Kim Sang-hyun, who also serves as its vice chairman.

The reshuffle is expected to streamline the company's decision-making process and strengthen its leadership as it seeks to expand its market presence both domestically and internationally.

At the shareholders' meeting, the company expressed regret over its 2024 sales and operating profit, which declined from the previous year.

Kim said, "Regrettably, our performance in 2024 was weaker than in 2023, with sales totaling 13.99 trillion won ($9.5 billion) and an operating profit of 473.1 billion won."

He added that the company expects "challenging management conditions this year as well due to sluggish domestic retail consumption, driven by high market prices and elevated interest rates."

Shin has assumed the shopping division's leadership largely because retail has been the conglomerate's foundation and primary revenue driver.

The group operates a diverse range of retail stores across virtually all retail sectors in the country, including Lotte Department Store, discount chain Lotte Mart, electronics retailer Hi-Mart, shopping and tourism complex Lotte Town, Lotte Premium Outlet and e-commerce platform Lotte ON.

The Jamsil Station area in Seoul serves as the company's landmark location, housing Lotte World Mall, Lotte World Tower, Lotte Hotel, Lotte World theme park and its flagship department store in one central hub.

However, the downturn in domestic retail consumption has forced the company to close its worst-performing stores. Lotte Shopping’s sales peaked at 17.8 trillion won in 2018, but since 2020 — when revenue stood at 16.2 trillion won — the number of its retail outlets has declined by nearly 30 percent, dropping from over 1,230 to below 880.

At the shareholders' meeting, Kim announced plans to restructure management to enhance the profitability of the company’s existing businesses.

"To overcome the limitations of the domestic market and the current downturn, we will establish a new subsidiary in Singapore to strengthen our overseas operations," Kim said. "Building on the success of Lotte Mall West Lake Hanoi in Vietnam, we plan to launch new shopping malls and expand exports of our private brands to the United States, Singapore and Southeast Asian countries."