"Reduction of Sales Penalty" CU Implements 'Franchisee Win-Win Agreement' This Year

[Asia Economy Reporter Lim Hye-sun] CU announced on the 3rd that it will implement the 2020 Franchisee Win-Win Agreement, which includes reducing business penalty fees and extending the initial stabilization period.

This year's CU Franchisee Win-Win Agreement focuses on improving franchisees' rights and enhancing store competitiveness based on existing support measures.

Since 2017, CU has been implementing a franchise lifecycle management program that includes expanding the initial stabilization system, supporting electricity bills and product disposal, minimizing burdens upon store closure, and has been promoting a massive investment of about 600 billion KRW over five years to advance store IT and logistics systems.

This year, to strengthen franchisees' rights, CU adopted the Fair Trade Commission's standard franchise contract, including provisions such as ▲ reduction and exemption of business penalty fees ▲ requirements for changing business areas ▲ extension of the initial stabilization period.

Although these matters are currently applied in practice, they are being codified as amendments to the franchise contract to further strengthen fair trade and win-win cooperation in the franchise business.

Additionally, in accordance with the Fair Trade Commission's "Guidelines for Stable Contract Renewal of Long-Term Franchise Stores," compliance items were added to facilitate smooth contract renewal and operation for franchisees who have operated for more than 10 years.

In 2014, CU was the first in the industry to introduce a new franchise model allowing franchisees to choose whether to operate 24 hours at the time of contract signing and increased the franchisees' profit-sharing rate from the industry average of the 60% range to up to 80%, significantly improving franchise profitability.

The welfare level for franchisees is also the highest in the franchise industry, offering overseas distribution tours, welfare mall operations, corporate condo support, wedding services, postpartum care, nursing care service discounts, and various medical service discounts including dental, ophthalmology, and obstetrics and gynecology. Starting this year, total consultation services for labor, legal, and tax matters have been newly introduced.

This content was produced with the assistance of AI translation services.