Bum-seok Kim, founder of Coupang, Chairman of Coupang’s Board of Directors. Coupang offer
Fast Company, an American economic media outlet, selected Coupang founder Kim Bum-suk as Chairman of the Board of Directors of the ‘100 Most Creative Entrepreneurs’ in 2019 and introduced it as “Korea’s Jeff Bezos.” He compared him to the founder and CEO of Amazon, the world’s largest online shopping mall, saying that he changed the lives of Koreans with “rocket delivery,” which is delivered by midnight and delivered until dawn the next day.
Coupang took another step closer to his dream of becoming the’Korean Amazon’. In 2011, after 10 years after Kim announced his willingness to “list on the US NASDAQ,” he officially announced the listing on the US Stock Exchange (NYSE). Until the sales of about 47.8 billion won in 2013 reached about 13.3 trillion won last year, there is an evaluation that the determination and confidence of Chairman Kim, who is not afraid of challenges, played a role in the background of Coupang’s growth.
Investing boldly even to point out ’10 thousand years of deficit’
In March 2014, Coupang introduced the first rocket delivery that delivered within 24 hours to purchasers of products over 9,800 won. Coupang offer
Chairman Kim, who spent his childhood abroad following his father, who was an expatriate at a large corporation, learned little by little the sense of the overseas market through this experience. When I was at Harvard University, I started the magazine’Current’ in 1998, and after graduation in 2004, I founded the monthly magazine’Vintage Media Company’ targeting prestigious universities and sold it in 2009 to gain business experience. In this process, he confirmed the possibility of social commerce (e-commerce through SNS) and established Coupang with a capital of 3 billion won in 2010.
As competitors increased, Chairman Kim attempted to differentiate itself in 2014 with the fast delivery system’Rocket Delivery’ using his own manpower. Most of the domestic online and offline distributors operated delivery services by outsourcing them to specialized companies, but Coupang aimed to secure quality by securing a distribution center and deliver them directly, and to increase customer satisfaction through fast delivery.
The deficit continued due to aggressive logistics investment, but Chairman Kim continued to expand investment centered on logistics, saying that it was a “planned deficit.” Amazon of the United States also made a loss for eight years after its establishment in 1994 and continued to make a loss for the first time in 2002. Despite the deficit, Amazon steadily expanded its distribution centers, stored sellers’ goods in its own distribution center, and introduced a’full-filment’ service that handles the entire process of storage, packaging, delivery, and customer response, thereby boosting profitability. Coupang also expanded its distribution center and established logistics infrastructure by hiring’Coupangman’ who is in charge of delivery.
The size of the deficit decreased due to Corona 19… Investment expansion seems to continue
In the case of the novel coronavirus infection (Corona 19), the crisis turned into an opportunity. “When the customer is in a difficult situation, it should be the customer’s support rather than the profit and loss,” he said, and sold without raising the price of directly purchased quarantine products such as masks and daily necessities.
Early morning delivery and same-day delivery have also been increased for customers who cannot go outside the house. It seems that they tried to secure trust by solidifying their image as a reliable distribution channel rather than profit. It is also encouraging that Coupang’s deficit decreased by about KRW 150 billion from KRW 720.5 billion in 2019 as sales increased due to the spread of non-face-to-face shopping. However, there are also criticisms that the failure of the initial response after a confirmed corona19 occurred at the Bucheon Logistics Center was a side effect of the growth-oriented Coupang management policy.
This year, Coupang’s bold investment trend is expected to continue. In particular, if it succeeds in raising a huge amount of investment through listing on the US stock market, it is expected to strive to secure new growth engines such as diversifying profitability. Coupang is currently expanding new businesses such as food delivery service app’Coupang Itz’, fintech business’Coupei’, and online video service (OTT)’Coupang Play’.
An official from the e-commerce industry said, “As Chairman Kim Bum-suk usually had a management goal of’to make it impossible for customers to live without Coupang’, Coupang is expected to discover various new businesses even after listing on the US stock market.”
Sora Lee reporter [email protected]
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