Rise of Korea's dollar store Daiso explained in 2 minutes
As a place where affordability meets variety, Korean dollar store chain Daiso has ridden a steep growth trajectory over its three decades of history.
The store's value proposition shines even brighter amid soaring inflation, with virtually every category in stock at affordable prices between 1,000 won ($0.70) and 5,000 won -- from everyday essentials to small luxuries that provide a sense of indulgence.
Last year, Daiso's annual revenue nearly reached 4 trillion won, coming in at 3.96 trillion won -- a 14.7 percent increase from the previous year. Operating profit rose even more sharply, soaring 41.8 percent year-on-year to 371.1 billion won.
Now fully Korean-owned
1992: Park Jeong-bu founded the household goods retailer Asung Industries, inspired by the Japanese 100-yen shop business model. The name Asung means to succeed in Asia.
1997: Park officially established the company under the name Asco Even Plaza in Cheonho-dong, eastern Seoul. It became the first company in Korea to adopt a flat-rate pricing model.
2001: Japan's 100-yen shop Daiso Sangyo acquired a 34.21 percent stake in Asung Industries, investing around 400 million yen, equivalent to around 4 billion won in today's value. Following the investment, Asung Industries changed its name to Asung Daiso.
2023: Asung Daiso's parent company, Asung HMP, reacquired the entire 34.21 percent stake from Daiso Sangyo, raising its total ownership from 50.02 percent to 84.23 percent in a deal estimated at around 500 billion won.
With the transaction, the company became fully Korean-owned. The remaining shares are owned by founder Park Jeong-bu's two daughters.
Growth fast-tracked
While Daiso posted annual sales of just 20.4 billion won back in 2001, it first surpassed 100 billion won in revenue in 2007. Its rapid growth began in the 2010s, with its sales skyrocketing to 500 billion won by 2011, marking a fivefold increase in just four years.
The company first reached 1 trillion won in revenue in 2015, followed by a breakthrough of 2 trillion won in 2019 and 3 trillion won in 2023.
Contrary to industry expectations, Daiso's revenue fell just short of surpassing 4 trillion won last year, reaching 3.96 trillion won.
Meanwhile, its operating profit, which hovered around 20 billion won annually from 2021 to 2023, exceeded 30 billion won for the first time last year.
With its uniform pricing strategy, Daiso has consistently priced over 80 percent of its products below 2,000 won in a six-tier pricing structure: 500, 1,000, 1,500, 2,000, 3,000 and 5,000 won.
Carrying around 30,000 different products across a wide range of categories, Daiso has effectively cut costs by streamlining its distribution channels and placing large-volume orders with suppliers.
These efforts have helped the company achieve economies of scale, lower its cost ratio and improve overall profitability.
In the early 2000s, Daiso had fewer than 100 stores. By 2005, the number had surpassed 500 and reached 1,000 in 2015. Today, there are more than 1,500 stores nationwide.
What's next?
Daiso is broadening its reach in beauty and fashion.
Since entering the cosmetics market in 2021, the company has rapidly diversified its product lines and brand collaborations. Major beauty players such as Amorepacific and LG Household & Health Care have even launched Daiso-exclusive cosmetic lines.
Daiso is boosting its e-commerce operations via its app, which offers services like same-day delivery.
In line with its growth, the company is zeroing in on expanding its logistics infrastructure, with plans to open new hub centers in Sejong City by 2027 and in Yangju, Gyeonggi Province, by 2028, in addition to its three existing logistics centers.
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