K-food Boom Drives Surge in Group Catering Demand... "Food Distribution Companies Need Response Strategies"

Samjong KPMG: Food Distribution Market Shifting Toward Large Corporations
Major M&A Deals Accelerate Industry Restructuring
Digital Transformation and Global Expansion Drive Competitiveness

As demand for group catering has increased due to the impact of high inflation, major food distribution companies experienced growth last year, and large-scale M&A (mergers and acquisitions) activities became more active within the industry.

On June 9, Samjong KPMG analyzed this trend in its report, "The Current State of the Food Distribution and Group Catering Market Through 10 Key Trends." The report noted that the domestic food distribution market, which had long been dominated by small businesses, is now undergoing a structural shift toward large corporations. Although the market share of large companies remains at around 20-30%, they are gradually expanding their influence by leveraging their ability to procure large volumes, logistics infrastructure, and business solution capabilities.

For example, last year, Sajo Group acquired Foodist for 250 billion KRW, and this year, Hanwha Hotels & Resorts purchased a 58.6% stake in Ourhome for 869.5 billion KRW. The report explained that these companies are strategically acquiring firms that can create synergies in areas such as food processing and manufacturing, thereby strengthening their competitiveness.

As K-food gains popularity, global demand for group catering is also expanding. The report analyzed that while major catering companies such as Samsung Welstory, Ourhome, and Hyundai Green Food had previously relied largely on group companies' overseas operations, they are now strengthening their presence by expanding local business sites in regions such as the United States, Vietnam, and Europe.

In addition to group catering, new business models such as dining-out solutions, concessions, and apartment food and beverage services are also attracting attention. The report pointed out that companies are increasing profitability by providing customized consulting and brand launch support for small business owners, expanding their customer base by offering services across all stages of the restaurant industry, and broadening their business scope to include military catering, franchise operations at airports, rest areas, and sports stadiums, as well as meal services within luxury apartment complexes.

At the same time, the digital transformation of the food distribution market is progressing rapidly. The report noted that transaction methods are shifting from traditional face-to-face and phone orders to online platform-based orders, and customer convenience is being enhanced through automated logistics, cold chain systems, and collaboration with local supermarkets.

The report also explained that the adoption of AI-based systems is spreading, such as Hyundai Green Food's development of an "AI People Counting" service that automatically measures and displays cafeteria congestion in real time, and Samsung Welstory's implementation of a system that uses artificial intelligence (AI) to scan trays and analyze the types and amounts of food waste.

Han Sangil, Deputy CEO and leader of the Distribution and Consumer Goods Industry at Samjong KPMG, stated, "As the domestic food distribution market is reorganized from a small business-centered structure to one led by large corporations, companies' response strategies to strengthen competitiveness are becoming increasingly important." He added, "Food distribution companies must secure differentiated competitiveness through digital transformation, premium catering, and global expansion."

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