Corona troubles compounded by general election... Growing controversy over Baemin commission fees

Political Circles Pressure Fee Reduction... Company Says "Better for Small Businesses"
Merchants Criticize "Unprecedented Increase"... Alternatives Like Public Delivery Apps Emerge

The food delivery application 'Baedal Minjok (Baemin)' is facing growing controversy over the commission fee restructuring implemented this month, amid the ongoing COVID-19 pandemic and the general election. There have been outcries that the changes increase the burden on small business owners who are already struggling due to COVID-19. In response, political circles have been competing to explore various measures, including legislation, to reduce delivery app commission fees. Local governments have also joined in, showing signs of creating 'public delivery apps' to compete against Baemin. In response, Woowa Brothers, the operator of Baemin, has emphasized that more businesses will see a reduction in commission fees under the new structure.

On the 6th, Woowa Brothers stated, "The reason why major platforms worldwide operate based on commission fees is that this system is the most rational and fair." They added, "We plan to continuously update data proving that the new pricing plan benefits more small business owners." Baemin said that with this restructuring, 52.8% of all registered businesses will see a decrease in their monthly commission fees, and about 58% of small business owners who have been open for less than a year or have annual sales under 300 million KRW will experience cost savings. Baemin intends to consistently provide supporting data to overcome the current controversy and clear up misunderstandings. Given the upcoming Fair Trade Commission's corporate merger review and concerns about monopolistic harms, Baemin appears to be taking a more proactive stance.

Contrary to Baemin's explanation, the controversy and backlash are growing amid the spread of COVID-19-related small business damages and the election climate. On the 6th, the Democratic Party of Korea announced that Baemin's commission fee restructuring imposes a heavy burden on small business owners and that they will seek various measures, including legislation, to reduce fees. Kim Jin-pyo, head of the party's COVID-19 Crisis Overcoming Committee's Emergency Economic Measures Headquarters, said at a meeting held at the National Assembly that day, "The party will respond more aggressively to overcome Baemin's flawed commission fee system and the harms of monopoly," signaling a tough stance. Kim also mentioned free delivery apps like 'Baedal-ui Myeongsu' (a delivery app in Gunsan City with no commission fees) and consumer movements that order directly by phone without using delivery apps.

The key point of Baemin's pricing plan revision implemented this month is that the fixed-rate product 'Open List' at the top of the order screen has been changed to 'Open Service,' applying a 5.8% commission fee (excluding VAT), while the fixed-amount product 'Ultracall' (88,000 KRW per month, including VAT) at the bottom will have a limit on the number of registrations. Baemin claims this will resolve the so-called 'flag planting' issue, where some financially strong restaurant owners register multiple Ultracalls near their business to monopolize orders. However, since some businesses will face increased burdens due to the fixed-rate restructuring, the gap in positions is unlikely to narrow easily. The Korea Federation of Small and Medium Business also criticized the change, saying, "This commission fee restructuring is an unprecedented, unilateral, and significant increase."

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