Korea Federation of SMEs: "Average Commission at Department Stores Is 26%; at Large Supermarkets, 20%"

Survey of Transaction Practices of SMEs Operating in Large-Scale Retailers
Sales Fell Year Over Year at 37% of Businesses in Large Supermarkets
Reason for Sales Decline: "Changes in Consumer Trends and Sluggish Domestic Demand"

Small and medium-sized businesses operating in department stores pay an average commission rate of 26.1%, with the highest rate reaching 38%, according to a survey. Amid rising online shopping and sluggish domestic demand, 37% of businesses operating in large supermarkets saw their sales decline year over year.

The Korea Federation of SMEs announced the results of its “2026 Survey on Transaction Practices Between Offline Large-Scale Retailers and Small and Medium-Sized Enterprises” on November 4. The survey covered 900 small and medium-sized businesses operating in department stores and large supermarkets, with 100 businesses for each retailer, and was conducted from July 22 to September 21.

Average commission rate at large supermarkets in the 2026 survey on transaction practices between offline large-scale retailers and small and medium-sized enterprises. Based on special contract purchase and type-B lease transactions.

Highest Commission Rates: 38% at Department Stores and 26% at Large Supermarkets

For transactions based on special contract purchases and Type B leases, the sales commission rates paid by businesses operating in these stores averaged 26.1% at department stores and 20.2% at large supermarkets. Under a special contract purchase arrangement, a retailer buys goods on credit from a supplier on the condition that unsold products can be returned, then pays the supplier after deducting an agreed portion of the sales proceeds. Under a Type B lease, a business rents store space and sells its goods; the department store or large supermarket takes an agreed sales commission, and the business receives the remaining proceeds.

At department stores, cosmetics and fashion and apparel had the highest sales commission rates. The highest rates charged by each retailer were 38.0% at Hyundai Department Store, 36.0% at AK and Galleria, 35.0% at Shinsegae, and 33.0% at Lotte. The lowest rates were 10.0% at Lotte, Shinsegae, and Hyundai Department Store, and 15.0% at AK and Galleria.

Among large supermarkets, the highest commission rates were 26.0% at Lotte Mart, 25.0% at Homeplus, and 20.0% at E-Mart and Hanaro Mart. The lowest rates were 10.0% at E-Mart, Hanaro Mart, and Homeplus, and 18.0% at Lotte Mart. Rates were particularly high for sporting and leisure goods and apparel.

Average commission rate for department store vendors in the 2026 survey on trading practices between large offline retailers and SMEs, based on special contract purchase and lease (Type B) transactions.

By type of arrangement, special contract purchases accounted for the largest share at department stores, at 76.0%, while direct purchases accounted for 91.0% at large supermarkets. Under direct purchasing, the retailer buys the goods and assumes responsibility for selling any items that remain unsold.

For direct-purchase transactions, the average margin rate charged by large-scale retailers was 20.6% at department stores and 21.0% at large supermarkets. At large supermarkets, the average margin rate was highest for books, cultural goods, and musical instruments, while at department stores it was highest for fashion and apparel. The highest margin rates at large supermarkets were 46.7% at Lotte Mart and 40.0% at E-Mart, Homeplus, and Hanaro Mart. At department stores, they were 33.3% at Lotte, 30.0% at AK, Galleria, and Hyundai Department Store, and 26.0% at Shinsegae. The lowest margin rates ranged from 10% to 16% at department stores and were 10% at large supermarkets.

Sales Fell Year Over Year at 37% of Businesses in Large Supermarkets

Sales fell year over year at 37% of small and medium-sized businesses operating in large supermarkets. Among businesses reporting a decline, apparel accounted for the largest share at 53.1%, followed by cosmetics at 44.3% and furniture at 40.0%. Homeplus had the highest share of businesses reporting lower sales, at 63.0%—more than twice the rate at Hanaro Mart (26.0%), E-Mart (28.0%), and Lotte Mart (31.0%).

Among businesses operating in department stores, 21% said their sales had declined. The most frequently cited reasons for lower department-store sales were “changes in consumer trends and sluggish domestic demand” (57.1%), followed by “rising raw material prices and increased labor costs” (33.4%).

Some 11.8% of businesses operating in large supermarkets said their operating conditions had worsened. They cited increases in sales commission rates or sales incentive rates when renewing contracts as the reason. In 2025, 5% of businesses had experienced unfair trade practices or other misconduct by large supermarkets, and most of those businesses had encountered delays in settlement of payments owed by Homeplus.

For both department stores and large supermarkets, the most common period for paying suppliers was 21 to 30 days. Some businesses using direct-purchase arrangements—2.4% at department stores and 5.2% at large supermarkets—had to wait more than 40 days.

Businesses operating in these stores most commonly said that reducing commission rates should be a priority for expanding mutually beneficial cooperation. This was cited by 43.0% of department-store businesses and 37.5% of large-supermarket businesses.

Kim Hee-jung, head of the Economic Policy Division at the Korea Federation of SMEs, said, “Sales at businesses operating in these stores are declining amid the growth of online markets and sluggish domestic demand, but the burden of commissions remains. Retailers and small and medium-sized businesses need to discuss transaction terms, including commissions and payment deadlines for supplier payments, and voluntary cooperation for mutual benefit needs to expand further.”

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