Musinsa's Daelim Changgo in Seongsu-dong, Seoul, is crowded with visitors in this undated photo. Courtesy of Musinsa

Iconic stores that represent their neighborhoods in and out of Seoul are making their local economies more vibrant. They serve as examples of how businesses can benefit their host communities by bringing in more visitors and tourists from across the country.

Fashion outlet Musinsa is one such example, making strides in Seoul's hip Seongsu-dong area, while bakery company Sungsimdang is opening new stores throughout Daejeon on its popularity. In Gangwon Province, Terarosa, a coffeehouse franchise, is drawing tourists to Gangneung.

While retail trades mainly take place around tourist destinations and commercially developed regions inside the country's capital region, these businesses in traditionally less busy neighborhoods generate robust sales, even donating to their host communities.

Musinsa is generating buzz with its recently opened Daelim Changgo offline store in the Seongsu area. Originally launched as a curated shopping platform for small- and medium-sized fashion brands, the company has been expanding its offline presence.

Daelim Changgo, which opened in September, has hit the jackpot, attracting an average of 100,000 visitors each month. In October, tourists from outside the country generated half of its monthly sales. The company plans to open a new 5,000-square-meter shop in the same area, raising expectations that it will further boost the surge of visitors to Seongsu.

Musinsa's growth has raised concerns about gentrification across Seongsu. However, the Seongdong District Office, where Seongsu-dong is, downplayed the concerns by introducing a new contract signing manual for district business operators that ensures that not only landlords and lessees but also the district authority are signatories. The authority introduced the tripartite signing regulation to promote the mutual growth of local businesses and communities and prevent gentrification.

One of Sungsimdang's stores in Daejeon / Courtesy of Sungsimdang

Social outreach to local communities has also earned Musinsa extra credit. Since 2022, it has been donating clothes to vulnerable community members and cooperating with the Seongdong authority in designing and providing shoes for those with disabilities.

In Daejeon, Sungsimdang has become the metropolitan city's quintessential institution. Currently running six stores across the city, the bakery company attracts almost 10 million visitors to Daejeon and Chungcheong Provinces each year, according to data.

Recently, Rosso, which operates Sungsimdang, signed an agreement with Daejeon Metropolitan City to cultivate wheat locally on a 23,100-square-meter field — the size of three soccer fields. With the new, locally grown wheat, the bakery franchise is expected to boost its production and reach more pastry lovers outside Daejeon.

Terarosa has built years of fame in the eastern coastal city of Gangneung, known for its house-roasted coffee beans and java drinks. Its growth in the region has been so significant, with four stores now in Gangneung, that it has expanded to additional locations in Seoul, Sejong, Busan, Jeju Island and across Gyeonggi Province.

The three companies, according to industry experts, prove that consumption nowadays occurs around certain key brands and regardless of location. Hence, they coined the term "loconomy," a portmanteau of "local" and "economy."

"At first, a business must thrive in a local community. Then, that business will represent that community and allow the community's local commerce to develop," one expert said. "Finally, the business operator and the local authority must start cooperating to mutually develop the business and the local commerce. This will usher in the whole circulation of local economic growth."