Gmarket ad (Courtesy of Gmarket) Gmarket Inc. will cut jobs for the first time since it was acquired by South Korea’s retail giant Shinsegae Group in 2021, joining the group’s workforce reduction rush this year under the leadership of its new chief striving to turn around the retail group grappling with losses at its key units.
According to sources in the Korean retail industry, Gmarket announced a companywide early retirement program on Friday morning. Full-time workers who have worked for the company for two years and more are eligible for voluntary redundancy.
The company will also aid anyone seeking a new job with a job search support program.
This is Gmarket’s first layoff since the Korean retail giant acquired eBay Korea, the parent of Gmarket and Auction, once the country’s two largest open market platforms.
But this is not the first job cut at Shinsegae Group companies this year.
The open market platform posted a cumulative loss of 100 billion won ($75.7 million) for two years since 2022. In the first half of this year, it logged an operating loss of 22.1 billion won.
The company attributed challenging retail market conditions for the job cut and vowed to restore competitiveness that is sustainable through restructuring.
“We have been constantly challenged by a shift in market rivalry and drastic changes in the business landscape over the past few years,” Chung said in a letter to Gmarket employees on Friday.
“We have concluded that it is inevitable to make fundamental changes to overcome such challenges and ensure a sustainable business structure.”
With Gmarket joining its sister companies in Shinsegae Group’s job cut wave, the groupwide restructuring is expected to gain traction, industry observers said.
MORE RESHUFFLES AND JOB CUTS AHEAD
Shinsegae Chairman Chung Yong-jin Since his rise to chairmanship of Shinsegae Group in March, Chairman Chung Yong-jin has been striving to overhaul the group’s business reeling from falling sales and profit amid growing competition from e-commerce players like Coupang Inc. and Naver Corp. as well as Chinese rivals AliExpress and Temu.
The leader of the country’s largest retailer and grandson of late Samsung Group founder Lee Byung-chul is said to be aggressively seeking to revive the group’s mainstay businesses, including E-Mart, this year.
After his inauguration as Shinsegae chairman earlier this year, Chung already replaced key units’ CEOs during rare mid-year reshuffles.
“As Chairman Chung is strongly determined to transform the group this year, Shinsegae is expected to continue revamping throughout this year,” said an official from the Korean retail industry.
The company’s anticipated annual executive shakeup next month is expected to hint at the group’s restructuring plans.