Online bookstores in Korea raise minimum orders for free shipping

2023.02.15 10:28:02 | 2023.02.27 14:30:03

Aladin Communication logo [Courtesy of Aladin Communication]이미지 확대

Aladin Communication logo [Courtesy of Aladin Communication]

Book lovers in South Korea that enjoyed buying a book online with free shipping will no longer be offered the service as major online bookstores will be raising minimum spending for free delivery this month.

Aladin Communication and Kyobo Book Centre Co., two major online retailer of books, will raise the minimum order requirement for free shipping to 15,000 won ($11.8) from Feb. 16 and Feb. 20, respectively. The move follows the same raise by Yes24 Co., Korea’s largest online bookstore operator, on Tuesday, from 10,000 won to 15,000 won.

The shipping fee will also be raised to 2,500 won from 2,000 at all three online bookstores. This means that consumers will have to buy a book worth at least 16,700 won, taking into account the 10 percent online discount, for free shipping.

A book in Korea is priced an average 17,116 won as of 2021, which is higher than the free shipping threshold, but literature books like poetry and novels are priced 12,000 won on average.

Korea’s top e-commerce company Coupang Inc., in the meantime, will still offer free shipping for a book that costs over 10,000 won and a shipping fee of 2,000 won.

“Low operating margin has been blamed at for the intense competition for free shipping among online bookstores,” said an unnamed official from a large bookstore. “The margin fell further due to a rise in courier costs for delivery.”

The official noted that a rise in minimum spending to 15,000 won will lead consumers to buy not just one book but two books, which will help book stores gain profitability.

Given that book publishers supply books to bookstores at a 65 percent rate, the bookstores earn 2,500 won when they sell a book that costs 10,000 won. A free shipping service resulted to zero profit.

The change in free shipping policy at online bookstores are expected to come as a concern for book publishers as books under 16,700 won will require a shipping fee, which will make them less competitive in terms of price. Books priced between 13,000 won and 15,000 won are highly likely to be raised to 17,000 won.

Printing costs have also surged due to high inflation.

Domestic paper manufacturers like Hansol Paper Co. and Moorim Paper Co. raised the price of paper for the book industry three times last year by 7 percent in January, 15 percent in May, and 7 percent in September.

According to the Publication Industry Promotion Agency of Korea, 7,732 books saw price changes last year, and of them, 6,222 books got higher price tags, which is twice as many as the previous year.

By Kim Seul-gi and Choi Jieun

[ⓒ Pulse by Maeil Business Newspaper &, All rights reserved]