As franchise companies have successively implemented a 'dual pricing system' that charges higher prices for delivery menus compared to in-store prices, an emergency has arisen concerning consumer delivery costs. Franchise companies argue that they have no choice but to do so because the effects of the co-prosperity plan established by delivery platform companies last year have been minimal. However, the significant increase in prices due to the dual pricing system is increasing the cost burden on consumers.
According to the industry on the 19th, coffee franchise Ediya Coffee began applying exclusive delivery prices for all products except Americano on delivery platforms such as Baedal Minjok, Coupang Eats, and Yogiyo since the 18th. The price of manufactured beverages was increased by 300 won, while some items such as bakery products, ready-to-drink (RTD), ready-to-eat (RTE), and stick coffee saw an increase of 500 won. However, orders through their app 'Ediya Members' maintain the same prices as before. An Ediya Coffee representative noted, 'The rise in delivery fees and the increase in materials and supplies prices are raising the operational burdens on franchise stores, making it unavoidable to make this decision for stable operations and long-term quality maintenance and service improvement.'
Burger franchise Mom's Touch raised the delivery menu prices by an average of 15% at 48 out of its 1,450 franchise locations nationwide. Although this is not a company-wide decision, the number of franchise owners demanding the dual pricing system has increased, leading to consultations between headquarters and store owners, resulting in some locations adopting the dual pricing system. According to the company, the current franchise transaction law does not allow the franchise headquarters to regulate the individual pricing policies of franchise stores, leaving it to the discretion of the store owners. Some franchises of chicken franchise Gubne Chicken also raised delivery menu prices by 1,000-3,000 won.
The co-prosperity plan jointly announced by Baedal Minjok, Coupang Eats, and others in November of last year included a tiered application of the brokerage fee for delivery apps, which is 9.8%, based on the transaction amounts of the participating vendors, ranging from a minimum of 2% to a maximum of 7.8%. A commission rate of 7.8% will be applied to the top 35% of vendors based on transaction amounts, 6.8% to those between 35-80%, and 2.0% to the bottom 20%. Delivery fees are also applied in a tiered manner. For those with transaction amounts in the 50-100% range, the same rates as before will apply, while the top 35% of vendors will see an increase of 500 won, and those in the 30-50% range will see an increase of 200 won. Industry leader Baedal Minjok has been applying the delivery fees established through the co-prosperity plan since last month, while second-place Coupang Eats is expected to implement it next month.
Earlier, the Franchise Association expressed skepticism about the co-prosperity plan. They argued that while the commission rate has decreased, the delivery fees have increased, rendering the effects of the plan minimal. In the case of Baedal Minjok, the average order value was set at 25,000 won. This structure means consumers must order more than 25,000 won for franchise owners to alleviate the cost burden. Consequently, franchises such as Burger King, McDonald's, KFC, Popeyes, and Hansot Dosirak have already implemented the dual pricing system. The in-store price of a Burger King Whopper set is 9,200 won, while the delivery price is 10,600 won. The in-store price of a KFC Zinger set is 7,900 won, with the delivery price being 8,500 won.
There are criticisms suggesting that while companies are bearing the additional delivery fees of a few hundred won, the increase in delivery prices due to the dual pricing system amounts to 1,000-3,000 won, adding to the burden on consumers. The dual pricing system ultimately shifts the delivery app fees onto food prices.
An industry insider noted, 'Major franchise companies have consistently raised prices citing the burden of delivery app fees even before the co-prosperity plan was introduced,' and added, 'Implementing the dual pricing system despite agreeing to the co-prosperity plan could reduce overall delivery demand, ultimately harming small business franchise owners.'
Seo Yong-gu, a professor at the Business Administration Department of Sookmyung Women's University, stated, 'The introduction of the dual pricing system is bound to increase the burden on consumers, but it is seen as a 'necessary evil' for establishing a delivery ecosystem.' He added, 'However, the increased prices should be fairly distributed not just to franchise owners but also to other stakeholders in the delivery ecosystem, such as riders.'