Lotte Himart is on the brink of transformation as it gears up for its regular shareholders' meeting scheduled for March 20, 2025, where it aims to strengthen its position by adding new business ventures. The company has announced plans to collaborate with large furniture and interior companies and expand its care services and private brand products to boost its competitive edge.
According to industry reports, Lotte Himart will formally vote on the addition of manufacturing electronic, electrical, and communication machinery parts, as well as visiting sales and after-sales service to its business objectives. This pivot seeks to reinforce its customized JOlip PCs to address surging demand for home visits as the demographic shifts toward senior citizens.
Over the last few years, Lotte Himart has felt the heat of dwindling sales, leading to drastic measures. Once achieving sales of approximately 4 trillion won with over 200 billion won in operating profits back in 2017, the company’s performance deteriorated, with revenue falling to about 2 trillion won last year. To counter this decline, Lotte Himart's strategy now includes pursuing synergies with prominent furniture entities like Hanssem to restore profitability.
Since July 2024, the company has been initiating its partnership with Hanssem through shop-in-shop strategies, exemplified by the opening of outlets within the Hanssem Design Park located at Suwon Gwanggyo and placing Hanssem furniture sections within select Lotte Himart locations. The integrated approach has reportedly boosted related product sales by nearly 20%.
Yet, doubts arise about the effectiveness of this cooperation. Hanssem has also faced challenges, with declining competitiveness as evidenced by revenue shrinkage over recent years. The furniture giant has seen its own store count drop dramatically from 917 to 759, reflecting broader industry pressures. The upcoming shareholders' meeting at Hanssem is set to appoint Lee Ho-seol from Lotte as outside director to bolster collaboration, but industry insiders remain skeptical about the tangible outcomes of such partnerships.
While Lotte Himart positions itself to strengthen its market foothold, it is also pivoting toward enhanced service offerings. The company is set to roll out its non-face-to-face care service, which includes appliance repair, cleaning, moving, and installation—services which traditionally require skilled infrastructure. With substantial growth in its overseas brand sales, projected to increase by over 80% year-on-year, Lotte Himart is intent on developing one-stop services ranging from import to after-sales care.
Looking forward to 2025, Lotte Himart has set ambitious growth targets, forecasting annual sales of up to 2.3 trillion won, with expectations of operational profit surging by 83% to 100 billion won. An official stated, "We will strengthen important after-sales management in home appliances by establishing consulting-only windows and running new services," emphasizing their commitment to embracing change to reverse poor financial standings.
Other industry players participating in the shareholder meetings are anticipated to follow suit, including notable companies like Nongshim, which plans to introduce its Smart Farm initiative and expand its business objectives. Key shareholders are scheduled to convene from March 20 to March 31, 2025, including major names like Hanwha Galleria and Amorepacific Group, who are also adjusting their business strategies amid shifting market dynamics.
With Lotte Himart's recent shareholder adjustments and strategic initiatives, the upcoming assemblies mark not just routine business but pivotal moments aiming to realign these companies with market demands, potentially heralding new growth strategies for the retail and consumer goods sectors.