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South Korea Fines Coupang for Squeezing Suppliers
26 Feb
Summary
- Coupang fined 2.2 billion won for pressuring suppliers on prices.
- The company demanded suppliers meet profit margins and bear costs.
- Coupang delayed payments to vendors totaling 281 billion won.
South Korea's antitrust regulator has imposed a fine of 2.2 billion won ($1.55 million) on Coupang, the nation's dominant e-commerce player. The Korea Fair Trade Commission (KFTC) found that Coupang violated the large-scale retail business law by pressuring suppliers to reduce prices and absorb additional costs to achieve the company's profit margin goals.
The KFTC stated that Coupang, as the market leader, forced suppliers into sacrifices to maintain its profitability. When suppliers were uncooperative, the company reportedly used retaliatory measures such as suspending or reducing orders. Furthermore, Coupang was found to have delayed payments to a significant number of vendors, with the total value of these delayed transactions amounting to approximately 281 billion won over a period spanning from October 2021 to June 2024.
