(Yicai Global) July 30 -- Lotte Group's high-end department store chain is considering packing up shop in China, a source in the retail sector told Yicai Global, after its sales slumped in the wake of a consumer boycott.

The South Korean group, which operates five department stores in the country, is assessing the feasibility of pulling out, the source said, adding that if the group decides to withdraw, it would start by shuttering two stores in Tianjin and one in Weihai in eastern Shandong province.

Formed in 1979, Lotte Department Store entered China 10 years ago in cooperation with Intime Retail Group. But about a year and a half ago it incurred Beijing's wrath and a consumer backlash by allowing the US military to site an anti-ballistic missile system on land it owned in South Korea.

"No information may be officially revealed at present," a Lotte Group spokeswoman said. "We've not decided on a specific final solution and are not ruling out any options, including withdrawal."

Lotte rents its Tianjin and Weihai stores, but owns its premises at Chengdu and Shenyang. Any delay divesting the former could result in losses, while haste with the latter could impact their market values, the source said.

Lotte Group has already announced plans to wind up its supermarket chain Lotte Mart in China. Shinsegae supermarket brand E-mart, another South Korean retail chain, also quit the Chinese mainland last year after two decades, citing disappointing returns. 

Editor: Ben Armour