TV Home Shopping Has the Highest Sales Commission Rate at 27.3%: Fair Trade Commission's Survey on Distribution Industry Practices

Reporter Kim SangJin / approved : 2024-12-12 03:49:59
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Photo = Fair Trade Commission

 

[Alpha Biz= Reporter Kim Sangjin] The Fair Trade Commission's survey of six major distribution industries revealed that the effective commission rate for home shopping suppliers is the highest. While the effective commission rate had been decreasing across most industries, last year saw an increase or a slowdown in the decline across various sectors.

According to the Fair Trade Commission on the 11th, the effective commission rates by industry are as follows: home shopping at 27.3%, department stores at 19.2%, large supermarkets at 18%, outlets and complex shopping malls at 12.8%, and online shopping malls at 11.8%. This survey is based on transactions from the previous year.

The effective commission rate refers to the proportion of the total sales amount that suppliers actually bear in commission. It is calculated by dividing the sum of the fees received by large-scale distributors from suppliers, as well as additional burden costs (promotion costs, logistics costs, etc.), by the total sales amount.

The effective commission rate for home shopping, department stores, and large supermarkets rose compared to the previous year. The rate of decline in outlets and complex shopping malls, which had previously seen significant reductions, slowed.

The effective commission rate for online shopping malls decreased by 0.5% compared to the previous year (12.3%), but this was due to the reduced size of transactions from the largest player, Coupang. Since June of the previous year, Coupang has suspended its special purchase transactions, meaning that no transactions were included in the effective commission rate calculation.

Online malls also have various transaction types, such as direct purchase and intermediary transactions, which are not included in the survey. Therefore, the overall structure of the industry cannot be understood by just the effective commission rate. The Fair Trade Commission is considering including online intermediary transactions in the scope of the large-scale distribution law and publishing those results.

Small and medium-sized suppliers bear an average of 4.2 percentage points higher effective commission rates compared to large suppliers. However, the gap has narrowed to 0.4 percentage points from the previous year's gap of 4.6 percentage points.

The percentage of suppliers paying sales incentives in direct purchase transactions was highest in convenience stores (50.3%), followed by large supermarkets (24.7%), online shopping malls (14.6%), and department stores (3.7%).

The percentage of suppliers paying promotion costs was highest for home shopping (57%), followed by convenience stores (47.2%), online malls (27.3%), large supermarkets (20.9%), department stores (20.1%), and outlets (11.2%).

 

 

 

Alphabiz Reporter Kim SangJin(letyou@alphabiz.co.kr)

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