GS The Fresh, a supermarket chain operated by GS Retail (007070.KS), has reached 500 franchise stores, with first-half revenue climbing nearly 10% as the company reshapes its business around franchising.
GS Retail said on the 20th that GS The Fresh Songpa Seokchon Station, its 500th franchise store, has opened. The milestone comes 16 years after the company launched its franchise business in 2010. The opening brings GS The Fresh's total store count to 603.
The Songpa Seokchon Station store occupies 288 square meters (87.5 pyeong) of net floor space near Songpa-daero. It targets everyday grocery needs of newlyweds and families living in the surrounding residential area. GS Retail CEO Heo Seo-hong and Kwak Yong-gu, head of the company's supermarket business unit, joined other senior executives at the opening ceremony to mark the 500th franchise store.
GS Retail has applied the expertise it built in convenience store franchising to its supermarket business, shifting a structure once centered on directly operated stores toward franchises. In 2019, directly operated stores (177) outnumbered franchises (142), but franchise numbers grew rapidly while directly operated stores declined, and the balance first flipped in 2021 with 179 franchises against 162 directly operated stores.
Standardizing product lineups and having headquarters support store operations such as merchandising and ordering has eased the operating burden on franchise owners, helping to attract new franchises. The company expanded its store network around residential areas, reflecting rising demand for grocery shopping close to home since the pandemic.
More recently, the company has strengthened its services in response to growing quick-commerce demand for grocery delivery. Through its Our Neighborhood GS app and channels including Baemin, Coupang Eats, Yogiyo and Naver Grocery, it offers one-hour grocery delivery. In the first half of this year, GS The Fresh's quick-commerce revenue grew 41.9% from a year earlier, and quick commerce accounted for 9.9% of second-quarter revenue.
These efforts helped lift GS The Fresh's revenue 9.6% to 923.2 billion won ($667 million) from 842.7 billion won, even as revenue across the supermarket-style store (SSM) sector fell 6.6% year-on-year in the first half.
A GS Retail official said the company aims to grow alongside its franchise owners by raising their competitiveness and operating efficiency through AI transformation (AX) and data-driven management, with the goal of generating stable profits for store operators.
