COVID-19 Cases Exceed 3,000... Franchise Industry Steps Up to Support Affected Franchisees

Franchisee Damages Increase from Coffee Shops to Dining Outlets
Headquarters Prepare Measures from Royalty Exemptions to Rent Support

[Asia Economy Reporter Choi Saeng-hye] As the number of confirmed domestic cases of the novel coronavirus infection (COVID-19) surpassed 3,000, the entire dining-out industry has suffered severe sales damage. In response, the domestic dining franchise industry has begun actively preparing measures to support affected franchise stores.

On the 29th, according to related industries, Ediya Coffee decided to provide support worth about 2 billion KRW, including waiving royalties for all franchise stores nationwide for two months, supplying one box of coffee beans free of charge, and continuously providing quarantine supplies such as disinfectants and masks.

Lotte GRS decided to extend payment deadlines for goods to consider sales damage to Lotte Ria and Angel-in-us franchise stores in the Daegu and Gyeongbuk regions starting from the 25th. There are 127 Lotte Ria franchise stores and 70 Angel-in-us stores in the Daegu and Gyeongbuk regions.

The Venti will waive the entire February royalty for about 430 franchise stores nationwide and reduce logistics costs by 10%. This is intended to share the difficulties of franchise stores caused by a decrease in customers due to the ongoing COVID-19 situation and to minimize damage. The Venti plans to continuously check the scale of damage and difficulties of each franchise store and prepare additional support measures by March to support all stores until sales return to normal.

Myeongryun Jinsagalbi will support the full monthly rent amounting to a total of 2.3 billion KRW for 522 franchise stores nationwide. The amount supported per franchise store ranges from a minimum of 3 million KRW to a maximum of 16.9 million KRW. Myeongryun Jinsagalbi plans to provide additional support to franchise stores until sales normalize at all stores, conduct free disinfection nationwide, and support store cleaning.

Twosome Place has allocated a special budget and decided to support 1 million KRW per store for raw material purchases for all franchise stores. Along with this, prioritizing the safety of employees working at stores and visiting customers, the headquarters has contracted with professional companies to sequentially carry out disinfection work for franchise stores nationwide. They plan to quickly secure hygiene supplies such as masks and hand sanitizers, which are in short supply, and provide urgent support to stores nationwide, prioritizing the Daegu and Gyeongbuk regions, offering practical assistance.

The Born Korea will fully waive two months of royalties for about 1,480 franchise stores nationwide and temporarily reduce supply prices for major ingredients such as coffee beans, meat, and sauces. Additionally, for temporarily closed stores, the headquarters will bear the cost of discarded food ingredients with short shelf life during the closure period and strengthen promotional support for hygiene and safety so that customers can visit stores with confidence. The Born Korea owns 22 brands including Paik’s Coffee, Hong Kong Banjeom 0410, Hanshin Pocha, and Saemaeul Sikdang.

Mom’s Touch has prepared and implemented phased support measures for 1,243 franchise stores nationwide (as of December). For franchise stores identified as visited by confirmed COVID-19 patients, they are classified as ‘confirmed’ and voluntarily close and conduct additional disinfection, providing a small amount of consolation money and support for goods payments to comfort sales damage.

The ‘serious’ stage applies to franchise stores operating in areas designated as ‘special infectious disease management areas’ by the Korea Disease Control and Prevention Agency. Currently, the Daegu and Gyeongbuk regions are the target of serious stage support, with about 30% of Mom’s Touch stores concentrated in these areas. They will receive a certain amount of goods payment support. Most franchise stores are classified as ‘caution’ stage, and the headquarters supports hygiene-related preventive inspections.

Genesis BBQ has decided to adopt the ‘ULV spray coating sterilization method,’ which sprays disinfectant in ultrafine particles, in addition to the spray-type disinfection starting from the 25th. They have allocated a special budget of about 150 million KRW to support disinfection.

BHC Chicken urgently supported masks and hand sanitizers to franchise stores in Daegu and adjacent areas. Goobne Chicken strengthened its existing QSC (Quality, Service, Hygiene) manual and distributed preventive action guidelines issued by the Korea Disease Control and Prevention Agency to stores. McDonald’s checks employees’ temperatures daily before work and provides masks.

A franchise industry official sighed, saying, "Many stores, especially in the Daegu and Gyeongbuk regions, have stopped in-store orders and replaced them with delivery and takeout. When confirmed cases occur in some areas, nearby stores voluntarily close, and there are even cases where part-time workers refuse to come to work, causing closures due to labor shortages." It was also reported that many stores in crowded places such as theme parks and parks have voluntarily closed.

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