LVMH-owned Sephora announced plans to withdraw operations from the South Korea market, after arriving in the north Asian market five years ago.
SEE ALSO: Sephora Greater China chief executive officer departs
Sephora’s Korean unit announced on its local Instagram plans for a gradual withdrawal from the market starting May 6. The phase out will affect the beauty retailer’s online mall, mobile app and offline outlets in South Korea.
Sephora first entered the Korean market in 2019 with a flagship store in Seoul’s luxury Gangnam district, in the capital’s south. Since then, it has opened five more stores across Seoul, but has faced weak sales on the back of harsh competition with local rivals, such as CJ Olive Young, which operates more than 1,300 stores across Korea.
The news comes on the back of the shock resignation of Sephora’s Greater China chief executive officer, Maggie Chan, in January, who stepped down from her role, after five years with the retailer.
In its most recent trading update, parent company LVMH said total revenues for the full-year 2023 grew 13 percent, with the French luxury conglomerate recording organic across all business groups except wines and spirits, with double-digit organic growth seen in Europe, Japan and the rest of Asia.
The Parisian firm’s selective retail segment, which includes Sephora, posted revenue growth of 25 percent in 2023, with Sephora achieving “another historic year, both in terms of sales and profit,” company said at the time of reporting.