CU Signs Win-Win Partnership Agreement with Franchise Stores in 2021

[Asia Economy Reporter Seungjin Lee] BGF Retail signed the ‘2021 Franchisee Win-Win Agreement’ with CU franchisees nationwide on the 16th. Since 2017, BGF Retail has continuously maintained effective win-win agreements that help strengthen franchise partnerships and improve store competitiveness.

The ‘2021 Franchisee Win-Win Agreement’ maintains the key points of last year’s agreement, which focused on strengthening franchisees’ rights such as ▲reduction and exemption of business penalty fees ▲strengthening requirements for business area changes, while significantly enhancing support systems that can serve as a pillar for franchisees amid the increasingly uncertain business environment caused by the recent COVID-19 pandemic.

Expansion of Insurance to Alleviate Franchise Operation Burden

Starting next year, BGF Retail will enroll all stores nationwide in freezer/refrigerator compensation insurance and product liability insurance. The franchise headquarters will bear the full cost of these insurance premiums.

CU is the only company in the industry to provide four major insurances?safe work insurance, general liability insurance, comprehensive property insurance, and cash theft insurance?at the franchise headquarters’ expense, supporting franchisees to focus on store operations.

The newly added freezer/refrigerator compensation insurance under this win-win agreement compensates actual losses if product damage occurs due to power supply interruptions to freezer or refrigerator equipment caused by natural disasters such as typhoons and floods.

This plan also covers indirect property damage caused by power outages. It was inspired by cases this summer where stores affected by flooding received up to 30 million KRW in compensation through comprehensive property insurance, greatly aiding their recovery.

Product liability insurance is newly introduced in response to the increasing number of stores operating ready-to-eat food items (such as bakeries). Although this insurance is generally subscribed to by food manufacturers, CU decided to be the first in the industry to enroll in it to reduce the operational burden on franchisees due to product diversification.

Expansion of Welfare for Store Owners Including Investment in Labor Management Solutions

Investment in labor management solutions, which is the area where franchisees most frequently express difficulties and whose importance grows every year, has also increased. BGF Retail will provide the labor integrated solution application ‘ToegeunhaeCU’ free of charge to about 15,000 stores nationwide starting next year. This app was first introduced by the industry this year.

ToegeunhaeCU is a one-stop system that allows easy handling of all labor-related matters via an app, from staff hiring to payroll calculation and attendance management. BGF Retail has partnered with the labor management integrated solution specialist company (WeSop) to continuously upgrade this service.

Additionally, the recruitment service ‘Geupgu,’ which quickly matches short-term workers when store staff vacancies occur, will be available free of charge without usage limits to all CU franchisees. The premium service fee, worth about 600,000 KRW per store annually, will be fully covered by BGF Retail.

BGF Retail operates a wide range of franchise operation support systems including ▲full headquarters coverage of brand advertising and store environment improvement costs ▲long-term operation incentives ▲win-win funds. The welfare system for franchisees personally, such as welfare mall operation, corporate condo support, health checkups, condolence support, and postpartum care, is also among the best in the franchise industry.

The initial win-win agreement in 2017 included a plan to invest a total of 600 billion KRW over five years to build logistics infrastructure and next-generation store operation systems, which is progressing as planned. Visible results have been achieved in about two years, including the full operation of the Jincheon Central Distribution Center (CDC) and nationwide introduction of next-generation POS systems combined with IoT (Internet of Things) technology.

Seogimun, Head of BGF Retail’s Win-Win Cooperation Office, said, “Despite the difficult management environment caused by COVID-19, BGF Retail has prioritized franchisee safety and competitiveness by actively implementing various support systems and investments. We will continue to practice responsible management that shines even more in crisis situations, aiming for healthy mutual growth with franchisees.”

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