Sales of luxury fashion goods at leading department stores jumped 27 percent on-year in March on retailers’ aggressive expansion and boosted marketing, the Ministry of Knowledge Economy said Thursday.

Foods sales at major discount outlets and department stores also rose due to their increased demand and inflation, the ministry said.

The proportion of luxury products sales at top department store chains Lotte, Shinsegae and Hyundai has been on the rise to reach 14.1 percent last month, the ministry said. The figure stood at 10.4 percent as of May 2010.

Four major imported brands Louis Vuitton, Chanel, Prada and Gucci, in particular, gained a 40 percent sales increase from the same period last year.

The ministry attributed such a trend to the three retailers having been seeking aggressive expansion amid fierce competition in the local market.

With their sights set on high-end goods sales, department store chains have been racing to upgrade their outlets and add new upscale stores.

They are enlarging existing downtown branches and online shopping malls, and are opening new stores ― department store branches as well as premium outlets ― in suburban areas.

The size of the Korean luxury market stands at $4 billion, or 4 percent of global sales, as of 2009. The amount accounts for more than 15 percent of total fashion spending in the country.

Experts are expecting the figure to be further boosted this year due to more diversified retail channels and selection, despite lingering global uncertainties and inflation jitters which may dampen consumer sentiment.

Meanwhile, grocery sales at the nation’s major discount outlets and department stores rose in March mainly due to greater demand and inflation, the ministry said.

Total sales at three leading discount outlets ― Lotte Mart, E-Mart and Homeplus ― edged up 1.9 percent on-year last month, a rebound from the 10.9 percent contraction reported for the previous month, according to the ministry.

Ministry officials said groceries, which accounted for 54.6 percent of all sales, expanded 5.8 percent on-year, offsetting losses in consumer electronics, miscellaneous goods and clothing.

Consumer electronics fell 13 percent compared to the year before, marking the sixth consecutive month of decline.

The report also showed sales at department stores increasing 13.1 percent on-year, up from a gain of 5.2 recently tallied in the previous month. Sales of groceries rose 12 percent.

By Koh Young-aah (youngaah@heraldcorp.com)