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dairyairy
Joined: 17 May 2012
Location: South Korea
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 Posted: Tue Dec 10, 2013 3:48 am Post subject: Korean government now targeting Starbucks & McDonald's |
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You know, those "evil" coffee and restaurant chains that are always filled with Koreans who enjoy the coffee and food. How dare they be so darn popular. It's time for the Korean government to put a stop to all of them. No more french fries! No more Cokes! No more frappucino's!
http://www.koreatimes.co.kr/www/news/biz/2013/12/123_147728.html
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Global food franchise brands, including Starbucks and McDonald’s, are expected to change their aggressive expansion strategy here, as Korea’s small players are urging the government to restrict their fast growth.
The Korea Convenient Restaurant Association, representing small food and beverage outlets, last week decided to ask the National Commission for Corporate Partnership (NCCP) to restrict major coffee franchise brands from opening new stores, arguing the survival of small coffee houses has been threatened by their aggressive expansion.
“It is almost impossible to run an individual coffee shop due to the dominance of big franchise brands,” said Kim Soo-bok, a director at the association. “We will first begin with coffee franchises and later ask for restrictions on the excessive expansion of pizza and hamburger chains.”
The request came as a lot of the self-employed who run small coffee shops and diners have been put in jeopardy due to competition from larger firms.
A recent study by the KB Financial Group showed that nearly half of self-employed businesses fail within three years, and more than 75 percent of them do not last a decade.
If their request is accepted, major coffee chains such as Starbucks, Coffee Bean, Twosome Place and Angel in Us, and fast food brands such as McDonald’s, Burger King and Pizza Hut, will be restricted from opening new stores.
The underlying logic is that owners of small coffee houses and food outlets believe that limiting the expansion of big franchises will promote shared growth.
In response, the NCCP said it will examine their request and take necessary action.
“We will first see whether it is legitimate or not and have a thorough discussion involving representatives from both big franchise brands and small coffee outlets to seek a solution,” an official from the NCCP said. “The decision should come out in the first half of next year.”
She stressed that the restriction, if approved, would be applied to both local and foreign franchise brands in a fair manner.
The government has pushed for restrictions as part of measures to protect small- and medium-sized enterprises (SMEs).
In September 2011, the government prohibited conglomerates from further expanding on a list of industries where SMEs could thrive. Under the policy, big companies are limited in the number of products they are allowed to sell, and cannot open new stores in any industry on the list.
Previously, the government has put the brakes on the expansion of big bakery franchises by banning them from opening new stores within 500 meters of existing bakeries.
The commission has also recommended that food service chains be barred from expanding and asked big companies not in the food business to refrain from entering that market.
Regarding the recent move, industry observers think the commission’s restriction on foreign brands could cause trade conflicts, as it could be seen as excessive regulation.
But foreign coffee brands and eatery chains took a very careful stance, saying they will take action depending on the NCCP’s final decision.
“Basically, it is our global principle that we follow local government’s rules,” an official from Starbucks Korea said. “Of course, the NCCP’s decision would have an impact on our business, as we would be restricted from opening more stores.”
The local arm of the U.S.-based coffee chain previously announced that it would increase its number of stores to 700 by 2016. Starbucks currently has about 530 stores nationwide.
McDonalds’ also shared a similar view, saying that it will abide by the local rules.
“It’s difficult to comment on what has not happened yet,” an official from McDonald’s said. “But basically, we will follow what the government comes up with.”
The brand has 330 stores nationwide, which it had planned to increase to 500 by 2015.
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happiness
Joined: 04 Sep 2010
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| Posted: Tue Dec 10, 2013 4:06 am Post subject: |
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| France has protectionism dont they? People will probably vote with their wallets. |
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optik404
Joined: 24 Jun 2008
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| Posted: Tue Dec 10, 2013 4:13 am Post subject: |
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| Meh, I'm ok with this. Korea doesn't need a Starbucks/McD's/Paris Baguette/Tous Le Jours on every corner. In my neighborhood alone there are five Starbucks within 2-3 minutes of each other. Another one is opening up soon in some building that's about a 10 minute walk. Deep down though, the small business owners know that if this passes, it's not going to help them out that much. If people want to go to Starbucks or McD's, they'll go there. |
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Who's Your Daddy?
Joined: 30 May 2010
Location: Victoria, Canada.
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| Posted: Tue Dec 10, 2013 4:44 am Post subject: |
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Before Starbucks came Korean coffee shops sucked (serving instant coffee), but they've learned and now know how to compete.
Same with Paris Baguette and Tous le Jours coming. It made the other bakeries so much better. There used to be nothing edible in them, but now some of them are better than those chains. |
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Deja
Joined: 18 Mar 2011
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nicwr2002
Joined: 17 Aug 2011
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| Posted: Tue Dec 10, 2013 5:44 am Post subject: |
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| Are they going to force them to close twice a month too? |
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Landros
Joined: 19 Oct 2007
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| Posted: Tue Dec 10, 2013 5:46 am Post subject: hmm |
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what's next? I suppose you are going to tell me the little bean pole man is Korean?? http://en.wikipedia.org/wiki/Bean_Pole
And Chevrolet? who owns those?? |
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mayorhaggar
Joined: 01 Jan 2013
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| Posted: Tue Dec 10, 2013 6:12 am Post subject: |
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| Maybe Koreans could try not having every business of one type clustered all together in one area, so you get 50 coffee franchises on one block and zero for the next 40 blocks. That would be too hard though...soooo busy...ppalli ppalli... |
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Steelrails
Joined: 12 Mar 2009
Location: Earth, Solar System
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| Posted: Tue Dec 10, 2013 6:25 am Post subject: |
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| Complains about Starbucks invading Itaewon and advocates foreigners "taking back Itaewon". Bemoans anti-Starbucks measures by Korean populace.. |
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NohopeSeriously
Joined: 17 Jan 2011
Location: The Christian Right-Wing Educational Republic of Korea
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| Posted: Tue Dec 10, 2013 8:10 am Post subject: |
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| I would rather see a gigantic Starbucks in Itaewon as a de facto symbol of non-Koreans in Seoul. |
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alongway
Joined: 02 Jan 2012
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| Posted: Tue Dec 10, 2013 8:28 am Post subject: |
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| Starbucks should just immediately build 400 more stores before they can make their decision, at that point, oh well too sad. |
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dairyairy
Joined: 17 May 2012
Location: South Korea
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| Posted: Tue Dec 10, 2013 1:10 pm Post subject: |
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| There may be Starbucks and McDonalds on "every corner" in Seoul but outside of Seoul it's a different story. And, yes, companies like Starbucks raise the bar and show Korean companies how to deliver products and customer service. Odds are that this will have unintended effects and cost Korean companies in the same industries more than the "foreign" ones. |
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crsandus
Joined: 05 Oct 2004
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| Posted: Tue Dec 10, 2013 2:30 pm Post subject: |
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| I was under the impression that Caffe Bene had the most locations in Korea. So even if Starbucks goes ahead with their expansion plans, I'm pretty sure they wouldn't have as many locations as Caffe Bene has currently. |
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Steelrails
Joined: 12 Mar 2009
Location: Earth, Solar System
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| Posted: Tue Dec 10, 2013 2:59 pm Post subject: |
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| dairyairy wrote: |
| There may be Starbucks and McDonalds on "every corner" in Seoul but outside of Seoul it's a different story. And, yes, companies like Starbucks raise the bar and show Korean companies how to deliver products and customer service. Odds are that this will have unintended effects and cost Korean companies in the same industries more than the "foreign" ones. |
Starbucks raises the bar on nothing. They just have the brand name. It's not like they're doing something magical that Cafe Bene/Angel-in-us/TomNToms/Holly's/etc. isn't. They can take their crappy acidic overpriced coffee and bugger off. Though I must confess, their awful spinach florentine whole wheat McMuffin concoction was oddly satisfying that weird mornin.. |
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Weigookin74
Joined: 26 Oct 2009
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| Posted: Tue Dec 10, 2013 4:14 pm Post subject: |
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| optik404 wrote: |
| Meh, I'm ok with this. Korea doesn't need a Starbucks/McD's/Paris Baguette/Tous Le Jours on every corner. In my neighborhood alone there are five Starbucks within 2-3 minutes of each other. Another one is opening up soon in some building that's about a 10 minute walk. Deep down though, the small business owners know that if this passes, it's not going to help them out that much. If people want to go to Starbucks or McD's, they'll go there. |
You must live in Seoul. In the rest of Korea, Starbucks and McDonalds are still far less frequent and only now expanding in a way that you Seoulites have had for last few years.
Again, the government here meddles in the economy and tries to control too much wondering why their economy is so sluggish and so heavily dependant on exports.
As for McDonalds, who are they competing against? Lotteria? Poor small company Lotteria? Maybe if they stopped using fake meat with weird toppings and improved their taste, it would have more of a fighting chance rather than blame mcDonalds.
Starbucks competing against those small Korean companies like Angel N Us Coffee, Caffe Benne, Tom N Tom's. Those evil fiends! Many coffee shops are full, including Starbucks. The demand for coffee compared to before has fueled Starbucks growth.
Honestly, there's a lot of stupidity here sometimes. For a nation of so called capitalists, they don't do it very well. They could learn a thing or two from us North Americans.  |
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