With platform fees and advertising costs weighing on them, and now a recent surge in packaging prices, some say management pressure on small restaurant owners is reaching its limit. As delivery apps and kiosks have spread, sales structures have been reorganized around platforms, but the expense structure has grown more complex.
The Small and Medium Business Ombudsman on Apr. 21 held a "meeting on platform fees" at the Korea Federation of Recreational Foodservice Industry in Gwanak District, Seoul, with representatives from industry associations including food service, to hear on-site opinions.
At the meeting, the restaurant industry said that the actual burden is rising sharply as not only delivery app brokerage fees but also payment fees, advertising costs, and delivery fees are combined. For establishments with a high share of delivery orders, related expense reaches about 30% of sales, they said.
In a survey on the "delivery platform coexistence index" that the Seoul Metropolitan Government released in Dec. last year, an analysis of actual sales settlement data from listed businesses showed that total usage fee ratios ranged from 16.9% to 29.3% of sales.
As platform expense increases, some establishments are said to find it inevitable to operate "dual pricing," setting different prices for delivery and in-store.
The burden of payment fees driven by the spread of kiosks and table ordering was also raised. Korea Federation of Recreational Foodservice Industry President Cho Yeong-sun said, "In the kiosk market, PG fees higher than conventional card fees are imposed, yet there are ongoing cases where this is not fully explained during contracting, or where excessive penalties are demanded for early termination."
The Korea Coin Karaoke Association also noted that as various payment methods such as pay-based payments and micropayments expand, it is difficult to grasp the actual fee structures applied. It said the information asymmetry problem, which makes it hard for owners to compare conditions by provider, remains.
Voices from the restaurant industry also said the burden has grown further with a recent surge in packaging prices. The head of a delivery restaurant said, "We were notified of price hikes of up to 40% for delivery containers and plastic due to the prolonged Middle East war," adding, "Given the nature of the restaurant business, raising prices leads to greater customer churn, so it is not easy to reflect higher costs in selling prices."
Choi Seung-jae, the SME Ombudsman, said, "Platform expense has formed a complex structure that goes beyond brokerage fees to include payment fees, advertising and exposure costs, delivery fees, and subscription fees," adding, "The expense burden felt by small business owners is structurally accumulating."
He added, "In a structure with high dependence on platforms, we will work with relevant ministries to review improvement measures that can enhance small business owners' managerial autonomy."