Shopping Over Expansion: Convenience Stores Challenge Large Supermarkets

Expansion of Fresh-Enhanced Convenience Stores

Rising Demand for Local Grocery Shopping Among One- and Two-Person Households

Store Count Drops to 53,266 Last Year Amidst Industry Growth Slowdown

#Amid the continued burden of rising grocery prices, Mr. Kim (36) has found himself visiting the convenience store near his home more frequently instead of going to large supermarkets. This is because buying small quantities of eggs or fruit at a convenience store, rather than purchasing in bulk at a large supermarket, not only reduces costs but also helps minimize food waste. "When I buy in bulk at the supermarket, I often end up throwing some away, but at the convenience store, I can buy just what I need at a reasonable price, so I use it more often," he said.

Convenience stores, leveraging their accessibility, are expanding their role as a channel for purchasing daily necessities. The surge in single-person households and the preference for nearby shopping have combined, prompting the convenience store industry to aggressively strengthen its fresh food categories—such as agricultural, livestock, and fisheries products—which were once the exclusive domain of large supermarkets.

According to industry sources on July 2, GS25, a convenience store operated by GS Retail, is expanding its "Fresh-Enhanced Stores," which incorporate the fresh food management expertise of GS The Fresh, its supermarket arm. These specialized stores have increased the number of grocery items—such as agricultural, livestock, and fisheries products, as well as side dishes—by 300 to 500 compared to regular convenience stores. As of the end of June, the number of such stores nationwide had grown to 956. The company plans to increase this number to 1,000 by the end of the year.

The results have been clear. Fresh food sales at Fresh-Enhanced Stores were more than 12 times higher than those at regular stores, and average daily sales exceeded those of regular stores by more than 1 million won. Overall fresh food sales have also surged. As of June 2026 (1st–29th), egg sales rose by 63.9% year-on-year, while vegetables (63.3%), livestock products (62.7%), and fruit (36.9%) also recorded high growth rates.

BGF Retail's CU has responded with its own grocery-specialized model, "Smart Grocery." The company has expanded its selection of fresh foods, such as fruit and vegetables, as well as small-packaged ingredients focused on refrigerated and frozen items, and has designed separate shopping flows for grocery customers.

In May, CU opened its first Smart Grocery store at the Tapdong Jungang branch in Suwon, and now operates three locations, including Sinchon in Seoul and Yeonsu-gu in Incheon. The first store's ingredient sales ranked in the top 1% among all CU stores nationwide. Ingredients account for 20% of total sales at that store, 10 times higher than the average for regular stores (about 2%). The top-selling items were mostly fresh foods such as gold kiwis, bananas, oriental melons, 30-egg packs, apples, and tomatoes.

CU's ingredient category continues to grow. Year-on-year sales growth rates were 24.2% in 2023, 18.3% in 2024, and 18.7% in 2025, marking double-digit growth for three consecutive years.

Customers are choosing GS25's cost-effective private brand product, 'Real Price'. GS25

The convenience store industry is focusing on fresh food competition as it enters a period of growth stagnation due to market saturation. According to the Ministry of Trade, Industry and Energy and disclosures from the four major convenience store chains (CU, GS25, 7-Eleven, Emart24), the number of convenience store locations nationwide fell from 54,852 in 2024 to 53,266 in 2025. This is the first annual decrease since the introduction of the convenience store industry in Korea in 1988. In a market where it is difficult to grow solely through new store openings, fresh foods that can increase the average transaction value and profitability of existing stores are emerging as a new growth engine.

Underlying this shift are changes in consumption patterns. According to Statistics Korea, single-person households accounted for 36.1% of the total as of last year. Unlike large supermarkets, which focus on bulk sales, convenience stores are expanding their product offerings for one- and two-person households, such as single bunches of green onions, individual apples, and small packs of meat, absorbing demand for smaller grocery trips.

The advancement of cold chain systems has also boosted the competitiveness of fresh foods. By monitoring temperatures throughout the entire process—from logistics centers to in-store displays—consumer trust in freshness has increased. On top of this, mobile app-based reservation purchases and special pick-up deals have further strengthened both price competitiveness and convenience. The recent increase in consumers turning to convenience stores during the spike in egg prices is another example of the expanding demand for local, convenient grocery shopping.

Industry insiders believe that as the convenience store sector matures, competition is shifting from expanding the number of stores to focusing on per-store sales and average transaction value. Because fresh foods can simultaneously boost purchase frequency and average transaction value, logistics competitiveness, cold chain capabilities, and sourcing from production areas are expected to become key factors in determining competitiveness among companies.

A convenience store industry official stated, "The increase in one- and two-person households and the growing demand for local, convenient grocery shopping are not temporary trends but structural changes. Investment in expanding the range of small-packaged fresh foods and securing price competitiveness will become even more active going forward."

This content was produced with the assistance of AI translation services.