As consumers increasingly prioritize essential purchases, forecasts indicate a slowdown in the retail sector's economic performance for the fourth quarter of this year.
The Korea Chamber of Commerce and Industry reported on October 21 that its Retail Business Sentiment Index (RBSI) for the fourth quarter of 2026 stands at 88, a decline of four points from the previous quarter's 92.
The RBSI quantifies the sentiment of retail businesses nationwide, with a score above 100 indicating a positive outlook and below 100 reflecting a negative sentiment among retailers.
Businesses anticipating a downturn cited reduced consumer spending as the primary reason. Among those predicting a decline in the fourth quarter, seven out of ten attributed it to weakened household consumption sentiment.
Consumers are also showing a tendency to seek products that offer better value for money or to limit their purchases to necessary items. The preference for cost-effective products remained steady or increased for 78.4% of respondents, while 83.6% reported maintaining or increasing their focus on purchasing only essential items.
By sector, department stores, buoyed by an increase in foreign tourists, exhibited the most optimistic outlook. The RBSI for department stores was recorded at 130 for the fourth quarter, down nine points from the previous quarter but still significantly above 100. According to data from the Korea Tourism Organization, the number of foreign tourists from January to September increased by 21.6% compared to the same period last year, with foreign tourist spending rising by 46.8% during the same timeframe.
Large discount stores reported an RBSI of 111, a one-point decrease but still above 100, while supermarkets saw a drop to 73, down 12 points. Convenience stores recorded a significant decline, with an RBSI of 79, a drop of 48 points from the previous quarter.
Seasonal factors, such as cooler temperatures leading to reduced outdoor activities and decreased demand for beverages and frozen treats, are believed to have influenced these trends. In contrast, online shopping saw an increase, with an RBSI of 82, up eight points, making it the only sector among the top five to show improvement.
Lee Seung-ryun, head of the retail logistics policy team at the Korea Chamber of Commerce and Industry, stated, "Despite expectations for year-end sales, the focus on practical spending and seasonal factors are creating mixed forecasts across sectors. With ongoing consumer spending constraints and competition among retail channels, a significant recovery in sentiment is unlikely in the short term."
* This article has been translated by AI.
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