SOUTH KOREA. Shinsegae Duty Free has entered into an agreement with LG Electronics to upgrade the retailer’s fulfilment operations and boost delivery performance through an AI-powered logistics system.
The partnership aims to address the specific operational challenges in duty-free retail, characterised by a fundamentally different logistics model from traditional retail.
With customers purchasing products months ahead of travel and collecting at airport pickup counters timed to their departures, the model requires precise coordination across inventory, scheduling and operations.
Shinsegae Duty Free is upgrading its logistics infrastructure to deliver traveller orders faster and more accurately.
Both companies completed an extensive diagnostic review of the retailer’s logistics operations on 18 March, identifying optimised system designs tailored to the distinct demands of duty-free fulfillment.
Leveraging LG Electronics’ smart factory expertise, the partners plan to roll out intelligent automation across the entire logistics chain – from inbound receiving and storage through inspection, picking and final dispatch.
The upgraded system will leverage AI and real-time integration between order data and on-site operations, to optimise end-to-end logistics performance
The system significantly enhances fulfilment capacity, processing shipments within one hour of order placement and handling up to 1,000 customer orders.
Mobile robotics will power high-speed, flexible automation at the logistics centre, improving inventory allocation, streamlining workflows, and boosting throughput and operational accuracy.
In addition, a Digital Twin-based integrated control platform will provide real-time tracking of equipment and facility conditions, supporting proactive identification of potential stock shortfalls and comprehensive operational oversight.
AI-powered video analytics will advance safety management across the logistics centre.
Together, these upgrades remove bottlenecks across fulfilment, from warehouse to airport pickup, delivering a faster, more seamless traveller experience.
Shinsegae Duty Free Senior Vice President of Sales & Marketing Division Hyunchul Kim said, “Because duty-free shopping is directly tied to travellers’ departure schedules, speed and accuracy in logistics are paramount.
“This collaboration is expected to meaningfully enhance customer convenience and service competitiveness, while establishing a new standard for innovation in duty-free logistics.” ✈
