We at Lotte believe that competitive suppliers are the driving force behind sustainable management, and we are exerting our utmost efforts in nurturing small yet highly competitive suppliers. To this end, we have established a Executive office of win-win growth in 2010 which sets group-wide mutual growth strategies/directions and reviews the related work processes and terms of business. The Lotte win-win growth academy, enables suppliers to access Lotte’s online and offline training infrastructure, which we hope will help build a sturdy foundation for sustainable growth. Lotte became the first corporation in Korea to publish a public report on its mutual growth results titled, “Lotte win-win growth report” to organize and openly share its subsidiaries’ mutual growth-related performances. Meanwhile, we constantly check on the implementation of ‘fair trade and mutual growth agreement’ at our subsidiaries and introduce customized mutual growth programs that encourage greater participation by the employees.
Lotte Group is managing the Lotte Shared Growth Fund in order to boost its competitive edge and management efficiency by funding and financially assisting small and medium-sized partner businesses. The Shared Growth Fund boasts a credit line that is twice the amount provided by Lotte Group for partner businesses and consists of a program that automatically reduces the interest rate for partner businesses within the credit line. Lotte Group plans to expand the size of the Fund in 2015 to 600 million won’s worth.
Lotte Group, in order to facilitate the flow of capital within small and medium-sized partner businesses, has shortened the payment due date to within 10 days of work completion and the business day right before the actual payment date if it coincides with a holiday. Moreover, it has pioneered in adopting a collaborative payment system that facilitates the flow of capital within secondary and tertiary partner businesses. Lotte Super adopted the collaborative payment system in 2013 before any of its market competitors while Lotte Construction and HomeShopping introduced the cash monitoring system in 2015. Lotte Department Store, Lotte Super, Seven Eleven, and other affiliate companies in the retail industry will adopt such systems as soon as they are available after development.
In collaboration with the Ministry of Trade, Industry, and Energy, Lotte Group is leading a “Global Quality Living Project” that aims to select up-and-coming small and medium-sized companies and promote them into industry leaders. Lotte and the Ministry plans to discover and assist 100 small and medium-sized companies until 2017 while opening a store specializing in global quality living products at the Lotte World Mall in Jamsil, Seoul, in September 2015.Meanwhile, Lotte Department Store also runs a select shop specializing in products made by small and medium-sized companies called Dream Plaza, making efforts to discover and assist exemplary small businesses.
Lotte Group’s affiliate companies in retail are vigorously expanding their businesses to China, Vietnam, and Indonesia, helping Korean small business products to reach an international customer throuth a robust global retail network. Lotte Super is conducting special exhibits of exemplary products made by Korean small businesses while touring foreign stores. It introduced Korean products in over three exhibits in Beijing in 2014 and conducted exhibits in Indonesia and Vietnam as well. Lotte Super operates K-hit plaza, a store brand that introduces products made by Korean small businesses, in Jakarta, Indonesia, Ho Chi Minh, Vietnam, and Beijing, China. Lotte Home Shopping is participating in a project to support exports of small business products and has consistently introduced products made by Korean small businesses through broadcast in China, Taiwan, and Vietnam. After its launch in 2012, it reached a sales record of 11.1 million won after consistently scoring 90 million won in sales. Lotte Deparment Store also conducted an exhibit of Korean small business products in its stores in China in 2014 and will consistently promote Korean small business products through two annual exhibits.
Lotte Group signed a coexistence agreement with the agricultural industry in 2015 to increase the consumption and export of agricultural food products and boost added value. By utilizing its food and retail infrastructure, Lotte plans to promote the increase of consumption and export of Korean agricultural food products and boost added value by the industry convergence of manufacture, processing, retail, sales, culture and tourism. Lotte and the agricultural industry have already made progress through collaboration in various fields. In 2014, Lotte Super accomplished the export of Korean onions through its Chinese stores and also succeeded in exporting Korean onions and mushrooms to China and Vietnam in 2015. Lotte will continuously discover new agricultural products to sell in its foreign stores. Lotte Super secures a stable market to organic farmers by operating an ‘Organic Zone’ in collaboration with local farmers while also providing agricultural products in more affordable prices through direct dealing, thereby sharing value with both the producers and the consumers. Lotte Chilsung Beverages is developing high quality fruit drinks using fruits in season from well-known producing districts through its sub-brand ‘Fruits in Season’ while Lotte Food has developed a ‘Uisung Garlic Ham’ brand using Uisung garlic and Korean beef. It is demonstrating a pioneering case of agriculture, manufacture, and culture combined not only through product development and sales but also through projects such as the Uisung Garlic Camp, which the local community’s scholarship work and consumers can be part of.