Despite Increase in Cafes and Chicken Shops During 'Kosiguk'... First Sales Decline Since 2013

Sales per Franchise Down 9%

Average Annual Revenue of Cafes and Chicken Restaurants Falls Below 200 Million Won

A chicken restaurant in Gwangjin-gu, Seoul, temporarily closed after a COVID-19 confirmed case visited. (Image source=Yonhap News)

[Sejong=Asia Economy Reporter Moon Chaeseok] Despite the COVID-19 crisis last year, the number of franchise stores such as cafes and chicken restaurants increased. However, due to social distancing measures and other factors, sales and employment decreased compared to the previous year for the first time since the survey began in 2013.

According to the 'Franchise (Franchise Store) Survey Preliminary Results' announced by Statistics Korea on the 27th, the number of franchise stores nationwide last year was 235,709, an increase of 9.5% compared to 2019. Except for automobile repair (5,500 stores, -21.9%), home laundry (4,701 stores, -2.7%), and stationery stores (1,674 stores, -0.1%), the number of franchise stores increased in all other sectors.

In particular, the franchise growth rates for gimbap and simple meals (15,840 stores, 18.5%), Korean food (36,022 stores, 16.5%), coffee and non-alcoholic beverages (21,360 stores, 16.4%), and pizza and hamburgers (14,324 stores, 14.9%) showed double-digit increases. The representative franchise sector, chicken, also increased by 7.7% to 27,667 stores. Lee Jin-seok, head of the Industrial Statistics Division at Statistics Korea, said, "The decrease in automobile repair and home laundry was due to the cancellation of franchise registrations by some brands," adding, "In sectors like Korean food and gimbap/simple meals, the increase in delivery-only stores seems to have contributed to the growth in franchises."

Due to the impact of COVID-19, franchise sales and employment showed a decline compared to the previous year for the first time since statistics began in 2013. Last year, total franchise sales amounted to 74.3653 trillion KRW, a 0.3% decrease from 2019, and the annual sales per franchise store also dropped 9.0% to 315.5 million KRW.

Due to restrictions on operating hours and other effects, sales at Korean restaurants, pubs, and cafes fell by more than 10%. Sales per Korean food franchise store, which exceeded 300 million KRW in 2019, shrank by 18.7% last year to 248.4 million KRW. Sales per coffee and non-alcoholic beverage and chicken franchise stores, which were over 200 million KRW in 2019, also decreased by 14.7% and 3.5% respectively last year, recording 178.7 million KRW and 198.6 million KRW.

Draft beer and other pubs (152.4 million KRW, -15.9%) and foreign cuisine (329.3 million KRW, -13.9%) also saw significant drops in sales per franchise store, and convenience stores (493.6 million KRW, -11.9%) fell below 500 million KRW per store. However, pharmaceuticals (1.0517 billion KRW, 4.6%) and stationery stores (405.9 million KRW, 4.9%) saw increases in sales per franchise store.

The total number of franchise workers was 802,501, a 5.2% decrease from the previous year. The number of workers per franchise store also dropped 12.8% to 3.4.

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