[비즈한국] Coupang has begun the formal compensation process for sellers affected by the fire at its Incheon logistics center. While the company initially raised sellers' expectations by promising full compensation immediately after the fire, the atmosphere among sellers who have received their compensation details is quite different. As some damaged inventory was not reflected in the compensation statements, sellers are continuously raising objections.
“They said it was based on delivery completion, but items not yet ‘received’ are missing from compensation statements”
According to BizHankook’s reporting, Coupang has recently begun providing specific compensation details to "Rocket Growth" sellers affected by the Incheon logistics center fire. The compensation process has commenced about a month after the fire occurred. Significant damage was caused to the products of Rocket Growth sellers stored at the center due to the fire that broke out at the Coupang 32 logistics center in Seoknam-dong, Seo-gu, Incheon, on July 18.
Four days after the fire, Coupang announced its policy to fully compensate affected sellers for their inventory losses. The intention was to proactively provide compensation even before investigations and insurance processing were completed. As compensation ranges are typically determined after calculating the scale of damage and going through insurance processing, promising full compensation ahead of these procedures was considered an exceptional measure. There was a strong sense of relief among the affected sellers regarding this policy.
However, when the actual compensation details were provided recently, complaints began to arise among some sellers. Sellers are demanding a recalculation of the compensation, claiming that the scale proposed by Coupang does not reflect the volume of goods they confirmed were damaged in the fire.
The issue stems from products that were delivered to the logistics center before the fire but had not yet completed Coupang's "receiving" process. Rocket Growth products are registered as inventory in the system after arriving at the center and undergoing inspection and quantity verification. However, there were products that had already arrived at the center at the time of the fire but had not finished the receiving process, and some of these were omitted from the compensation statements.
Rocket Growth seller A sent products to the Incheon 32 logistics center two days before the fire. Although they received a notification from the courier company that delivery was completed, the fire occurred before Coupang’s electronic receiving process was finished.
He said, “The goods reached the center, but ended up burning down. However, they were not reflected in the compensation statement because they weren’t captured as inventory in the system,” adding, “Looking at the photos sent by the delivery driver after the items were delivered, there was a significant amount of stock waiting to be received. There are quite a few sellers in a similar situation.”
Another seller stated, “Coupang announced in its initial compensation guidelines that it would compensate based on the courier’s ‘delivery completion’ time, not Coupang’s internal ‘receiving completion’ time,” adding, “However, after checking the actual compensation plan, products that hadn't finished the receiving process were missing from the list. I doubt whether the compensation standards they initially announced are being applied properly.”
1 trillion won deficit in the first half... Fire losses also a variable for Q3 recovery
It has been confirmed that there is no change to Coupang's policy of full compensation. However, it is known that a separate verification process is underway for goods that did not complete the systemized receiving process, as it is difficult to confirm exact quantities solely through Coupang’s internal systems. As this information has not been sufficiently conveyed to the affected sellers, confusion continues on the ground.
Coupang previously stated that to reduce the burden of proof on sellers, it would identify damaged inventory using its own systems and would not require complex evidence such as invoices or packing videos. However, for goods that have not completed the receiving process, sellers are in a position where they must personally submit evidence that the products were delivered to the logistics center. As a result, some sellers are complaining that, contrary to initial announcements, the actual compensation process carries a significant burden of proof.
One seller said, “They asked for photos of the products, photos with courier labels attached, and photos showing delivery completion. How many people keep that kind of data ready?” adding, “Coupang said they would provide full compensation without cumbersome procedures, but in the end, it’s the sellers who have to provide proof. It’s truly frustrating.”
Another seller pointed out, “Information for products being received at the Incheon 32 center, where the fire occurred, was changed to other logistics centers after the fire. Because of this, it is currently difficult to check the existing Incheon 32 center information in the seller system.” They added, “If you happened to take screenshots of the receiving screen and delivery records before the fire, you can provide proof, but otherwise, it is not easy for a seller to verify that the goods were delivered to the Incheon 32 center.”
The scale of Coupang’s losses due to the Incheon logistics center fire is estimated at approximately 350 billion won. In its second-quarter consolidated performance report submitted to the U.S. Securities and Exchange Commission (SEC) on the 5th (Korean time), Coupang Inc. stated that the related losses would be reflected in its performance starting from the third quarter.
For Coupang, which already recorded a massive operating loss in the first half of the year, this is no small burden. Coupang’s cumulative operating loss for the first half of this year was 798 million dollars (approximately 1.1895 trillion won). In particular, profitability deteriorated significantly in the second quarter as a fine of approximately 624.7 billion won related to a personal information leakage incident was reflected in selling, general, and administrative expenses.
The industry predicts that since the personal information leakage fine is a one-time cost, there is a possibility that the deficit could narrow somewhat in the third quarter. However, there is also speculation that because the fire-related losses are scheduled to be reflected in third-quarter results, they could act as a factor limiting the scale of performance recovery.