Domestic self-employed business owners consider delivery app fees to be the biggest financial burden in managing their restaurant businesses, leading nearly half of them to raise menu prices.
On the 14th, Yonhap News reported the results of a survey conducted by the Consumer Public Interest Network on 502 restaurant owners. The survey found that the most significant financial burden for restaurant owners was delivery app fees (5.68 out of 7 points), followed by taxes (5.46), ingredient costs (5.41), utility bills (5.38), employee wages (5.34), and rent (5.30).
Non-franchise businesses (5.77) felt a greater burden from delivery app fees than franchise businesses (5.56), and business owners in the Seoul metropolitan area (5.72) faced higher costs than those in non-metropolitan areas (5.63). By industry, cafés, bakeries, and dessert shops (6.07) were most affected by delivery app fees.
The burden of delivery app fees has led to increased menu prices. Among restaurant owners, 47.6% said they had raised their prices, while 34.8% introduced “dual pricing,” applying different prices for offline stores and delivery apps. Additionally, 34.8% increased the minimum order amount.
Price hikes were most common among independently operated cafés and bakeries in the Seoul metropolitan area, while dual pricing was most frequently adopted by non-franchise Chinese restaurants in the same region.
Due to delivery app fees, consumers have faced significant price increases. The average price increase for regular price hikes was 1,858 KRW, while businesses implementing dual pricing raised prices by an average of 2,114 KRW on delivery apps.
Only 26% of business owners believed that the new “tiered pricing system,” set to take effect on the 26th, would reduce their burden. Meanwhile, 44.4% viewed the expansion of public delivery apps positively.
Last July, four major delivery platforms, four business associations, the government, and public representatives launched the “Delivery Platform-Restaurant Business Cooperation Council.” As a result, Baemin (Baedal Minjok) will implement a reduced commission fee system starting on the 26th, and Coupang Eats will follow suit at the end of next month.
The core of this initiative is the “tiered pricing system.” Baemin will lower its current 9.8% commission fee to a range of 2%–7.8%, depending on sales volume. The top 35% of businesses by sales will pay 7.8%, those in the 35%–80% range will pay 6.8%, and the bottom 20% will pay 2%.
However, delivery fees will increase. Businesses in the top 35% sales bracket will see a 500 KRW increase, those in the 30%–50% range will see a 200 KRW increase, while businesses in the bottom 50% will continue to pay the current delivery fees of 1,900–2,900 KRW.
Work Cited
https://n.news.naver.com/mnews/article/277/0005546899
By. Taewon Heo