By Kim Tae-gyu
Lotte Group, one of the top conglomerates in Korea, opened the Year of the Rabbit with great fanfare as heir apparent Shin Dong-bin, the son of group founder Shin Kyuk-ho, was promoted to chairmanship.
Yet, the Seoul-based group seems to be experiencing more misfortune than luck after a series of mishaps in the year when the father-to-son power transfer is set to accelerate.
The first trouble happened midway through January in Lotte Department Store in Busan where a female Russian acrobatic performer fell off a high wire during an aerial stunt.
In the same month, moviegoers at Lotte Cinema Kunkuk University situated in Seoul were doused with water when the movie theater’s sprinklers came on without any sign of a fire.
While watching a three-dimensional movie, some watchers thought it was a special effect. But the amount of water was too much to be part of such an effect and Lotte had to give refunds.
In the aftermath of the back-to-back public relations calamities, some problems have appeared in the group’s retail chain of Lotte Mart with regard to its ultra-cheap laptops with price tags less than 300,000 won.
Some of the lightweight laptop vendors inside Lotte Mart reportedly used pirated versions of the word processor program Hancom and Microsoft’s office suites, which is illegal.
Lotte Mart, the nation’s No. 3 player following E-Mart and Samsung Homeplus, says that it is investigating.
``We are checking whether they really used pirated software. If they did so, we might have to review our policies of overseeing our contractors inside the outlets,’’ a Lotte Mart representative said.
``Whatever the results of the investigations, please remember that we did not by any means encourage our contractors to commit any wrongdoings.’’
It remains to be seen how this will turn out but this is not the first time that Lotte Mart has grabbed negative media attention. The outfit came to the fore late last year due to selling dirt-cheap chicken.
Back then, Lotte Mart offered fried chicken at 5,000 won a pack, which became hugely popular across the country since it was almost a third less than some of its rivals, mostly small-sized neighborhood stores.
Even though consumers were crazy about the inexpensive products, they angered the local chicken restaurants. Amid growing social pressure, Lotte Mart gave up the venture after a week.
``A host of incidents have taken place over the past few months. It is kind of extraordinary because Lotte Group is famous for preventing such bad things,’’ said a Seoul analyst who asked not to be named.
``It is mere coincidence that they have taken place at a time when Vice Chairman Shin Dong-joo was promoted to chairman. But the new chairman will obviously not be happy about this.’’
Lotte Group was established in 1948 by tycoon Shin Kyuk-ho as a producer of chewing gum. He later expanded the group’s business horizons to a variety of areas of snacks, beverages, insurance, construction, amusement parks and hotels.
Lotte is recognized as one of the top conglomerates here thanks to its stable cash flow and unique portfolio composed of the above-mentioned cash-rich industries. It also has roots in Japan.
Founder Shin’s second son Dong-bin is likely to take charge of the group’s operation in Korea while his elder brother Dong-joo is expected to lead the Japanese unit.