"170 'Good Franchise' Locations Confirmed"… Fair Trade Commission's 'Proactive Administration' Results

"'COVID-19 Overcome Franchisee Support Kind Franchise' Confirmation Mark Provided"
More than half of the applying headquarters reduce royalties for franchisees
6 out of 10 are Korean food and pubs, headquarters of dine-in restaurants

Chairman Jo Seong-wook of the Korea Fair Trade Commission visited the Good Franchise reception desk set up at the Korea Fair Trade Mediation Agency in Jung-gu, Seoul on April 10, meeting with franchise industry officials. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Moon Chae-seok] The Fair Trade Commission has issued 'Good Franchise' certificates to franchisors who reduced the burden on franchisees suffering from worsened business conditions due to the novel coronavirus infection (COVID-19), enabling them to receive policy funds under preferential conditions. As a result of this 'active administration,' 170 franchisors have been certified as 'Good Franchises' so far.

On the 2nd, the Fair Trade Commission announced the status of the 'Good Franchise Policy Fund Support Measures for Franchisee Support.' As of the end of last month, a total of 215 applications were submitted to the Korea Fair Trade Mediation Agency, and certificates were issued to 170 franchisors. When applying for policy funds at financial institutions, businesses receive benefits such as reduced loan interest rates by submitting the certificate.

The 170 franchisors who received certificates were found to have provided approximately 13.4 billion KRW in support to 23,600 franchisees (9.5% of all franchise stores).

Regarding the support contents from franchisors who received certificates, more than half were cases of royalty reductions. This accounted for 52.3% (113 cases) out of a total of 216 cases.

Cash support and other corresponding measures such as rent and delivery app fees followed with 35.6% (77 cases), advertising and promotional cost reductions with 7.9% (17 cases), essential item supply price reductions with 2.3% (5 cases), and support for franchisee losses with 1.9% (4 cases).

By industry, franchisors centered on face-to-face businesses, expected to be heavily affected by COVID-19, were predominant.

Six out of ten were food service franchisors (Korean cuisine, pubs, etc., with in-house dining). Among the total 170 franchisors, food service franchisors accounted for 58.9% (100 franchisors).

Service franchisors such as education followed with 17.1% (29 franchisors). Takeout and delivery-focused food service franchisors (12.9%, 22 franchisors) and wholesale/retail franchisors (1.8%, 3 franchisors) had relatively lower certificate issuance frequencies.

The Fair Trade Commission and the Mediation Agency will allow franchisors certified as 'Good Franchise' to use the 'COVID-19 Overcome Franchisee Support Good Franchise' certification mark provided by the Fair Trade Commission.

However, the mark can only be used temporarily until the end of this year, as the Good Franchise financial support project will only continue until then.

A promotional bulletin board will be created to provide an overview of all participating franchisors. The Good Franchise slogan will be produced and distributed.

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