Coupang has recorded 6.83 trillion won (currency/quarter 1340.5won)for sales, and 103.7 billion won(77.42 million dollars) for business profit, 121.5 billion won for net profit(90.67 million dollars)... The maximum sales scale in Korean won standards.

Beomseok Kim, the chairman, said "It was an outcome of the integrated distribution along with technology·fulfillment and lastmile delivery, while the inventory loss of the fresh product being decreased by 50%...Distribution network based on automation technology was a driving force for this performance.

Eventually, Coupang has turned to a surplus. It's been 8 years since the Rocket delivery launched and it turned into a surplus. (Photo byCONSUMERWIDE DB)

 

 

[Consumerwide_ Yohan, Bok Reporter] Eventually, Coupang has turned to a surplus. It's been 8 years since the Rocket delivery launched and it turned into a surplus. There has been an evaluation of the deficit of Coupang that had been intended. Now this statement has become a fact. Now, the Coupang game on full scale has begun.

On the 10th, followed by the official Coupang record for the 3rd quarter, Coupang recorded 6.83 trillion won (currency/quarter 1340.5won)for sales, and 103.7 billion won(77.42 million dollars) for business profit, 121.5 billion won for net profit(90.67 million dollar) during the 3rd quarter. This was the maximum sales scale ever in Korean won standards. The sales record in dollar standards was 5.1133 billion dollars, which was a 10% increase compared with the 2021 sales record (4644.7 million dollars).

Coupang has succeeded in turning a surplus during the 1st quarter, which has been 8 years since the first launch of the Rocket delivery in 2014. After closing, with the surplus news, the stock price of Coupang recorded 17.66 dollars during the day (excl. mor), which was increased by 8.41%.

Coupang has been building up competitiveness through consistent investment while enduring an accumulated deficit of 6 trillion won since the Rocket delivery launch in 2014. After all, it's been proved that they've developed a sustainable business model with the first quarter profit record of Coupang.

Coupang has succeeded in turning a surplus this third quarter. Because they've been focusing on improving profitability this year.

Coupang has recorded a surplus (2.87 million dollars) for product commerce(rocket delivery·fresh·marketplace) during the 1st quarter on the adjusted EBITDA standard. During the 2nd quarter, Coupang recorded net profit of 83.5 billion won(66.17 million dollars) on the adjusted EBITDA standard. The 3rd quarter has recorded 261.3 billion won (195 million dollars), which is about a 200% increase from the second quarter. It's been improved dramatically considering the same quarter 2021 recording a loss of 207.43 million dollars.

On that day, Beomseok Kim, the chairman of Coupang Inc, after announcing the official record, mentioned during the conference call that it was an outcome of the integrated distribution along with technology·fulfillment and last mile delivery, while the inventory loss of fresh product decreased by 50%. In addition, a distribution network based on automation technology was a driving force for this performance.

Beomseok Kim, the chairman of Coupang Inc said, "Distribution infra of Coupang is about the size of 500 soccer fields, which is bigger than the NY Central park. When the fresh product distribution is extended to various locations, there follows an increased stock loss. But, Coupang has decreased the fresh product stock loss by 50% compared to 2021, by using demand prediction based on machine learning technology. As we were merging the whole process of distribution, there was no longer a need to build an additional coldchain system. In turn, we could use regular delivery trucks for our fresh products. We reduced over 85% of the package waste of the supply, as well as delivery times. We could break through the former tradeoff between service-cost, customer-product because of integrated distribution along with technology·fulfillment and last mile delivery. Today, we're supporting an unlimited time of early morning delivery service for millions of products(delivered till 7am, a day after the order), and customers can turn back by placing the product in front of the door at any time.

We are extending this service from our Rocket product(1P) to the openmarket product(3P) continually. Z-delivery service also provides the same rocket delivery with a free turn back service for hundreds of thousands of store vendors by sharing the FLC."

The strategy of Coupang worked out. The number of customers and the purchasing power are growing. Customers who have bought even once have increased by 17,992,000, which is a 7% increase from 2021. Customer sales per person have increased to 284 dollars(380,000 won), which is a 3% increase, but 19%, by Korean won standards. The sales in the product commerce field have been recorded at 4.9 billion dollars(6.5684 trillion won), which is a 28% increase on the Korean won standard.

This is 4 times faster growth than the e-commerce product market in Korea. The adjusted EBITDA loss in the developing offering field (Coupangplay·Coupangeats·Overseas·Pintach) has been recorded at 44.3 million dollars(59.3 billion won), which is a 50% decrease from last year.

Kim, the chairman said, "The sales record in the new business field has increased by 10% by Korean won standards. And, the gross profit sales increased to 42million dollars compared with the same quarter last year. The new business is still in the beginning, but has the potential to unfold the customer innovation in the new market. We will continue investing on a small scale in the long run based on principle."

Experts said that this record has proved the competitiveness of the 'Coupang style rocket delivery distribution model'.

Yeonseung Jeong, the professor of Dankook university in business administration dept. has evaluated. "This surplus turn has showed that as the credibility and loyality of the customers gets deepen the profit and loss structure has improved stable. This shows the new co-existance model, that small businesses increase their sales at a national level through the online system. On the other hand, it demonstrates the competitiveness of the Korean innovation business in the slowdown of global e-commerce."

Sangwha Song, the professor of Inchon University in Northeast Asia Distribution MA dept. said, "The fundamental essential of e-commerce is establishing the flywheel system, which works automatically only with the automatic distribution network. This record seems to demonstrate the result of faith that the innovative distribution network of Coupang works."

 

 

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