There are signs that the domestic franchise industry is faltering. The number of businesses that have been closed has increased, and the M&A market is also being sold, but there is no place to buy. 토토사이트 The public offering of a franchise company, dubbed the "flower of the start-up myth," is also in a state of all-stop. With the slump in domestic consumption, rising labor costs and government regulations, the franchise industry, which has been growing since the 1990s, is facing a turning point.
There are dozens of franchise outlets already opened in the M&A market. Most of them include "Onderbodder," which was founded by Lee Ji-yong, who brought TGI Friday, a family restaurant, as well as food and beverage franchises such as Cafe Marmas (salad specialty stores), and Tolerance.
Private equity funds (PEF), which were busy acquiring franchises, have also turned around 180 degrees since the second half of this year. It seems that it is trying to clear up the franchise that it took over. Other examples include Harley's Coffee and Burger King Nolbu's MadPogalic Outback. Standard CharteredPE, once known as a restaurant franchise, chose Samsung Securities as its main selling agent in July, but temporarily suspended the sale because there were no buyers. Franchises that were established by private startups are also mentioned in M&A markets. School Food has been negotiating with a PEF recently, but it is said to be making no progress.
Some of them are trying to turn their businesses into direct businesses after abandoning their businesses that have many regulations. One of the franchises of Seolleongtang is going directly to the franchise store where the franchise contract ends this year. CJ Foodville plans to phase out its Korean food franchise, Seasonal Table.
○ All-Stops to be listed
Founders who dreamed of becoming listed on the stock market by writing "Frenching success stories" are also abandoning their dreams. Among its affiliates in Korea, only three of them were listed: Hammarro Food Service, which runs Mamasturt, and Dim (Mapogagi) and MP Group (Mr. Pizza).
Franchises, which had been preparing for the listing, have temporarily stopped opening their businesses due to the worsening economy and uncertainty of growth prospects. When listed, the price of public offering is low, making it profitable and only subject to criticism. "We have been preparing for the listing since last year, but we temporarily suspended the listing due to the lack of attractiveness of the franchise due to the slump in domestic consumption," said Moon Chang-ki, chairman of the original coffee franchise Idiyakoffee. Kyochon F&B, fruit juice franchise Ju, and Bulgogi Brothers have also reportedly abandoned their plans to be listed.
Minimum wage, lack of domestic demand, and regulation 3
The reason why the franchise industry is faltering is due to its lack of attractiveness. First of all, the domestic market is depressed. CJ Foodville, which has been franchising all restaurant businesses including coffee desserts, dining out and baking, posted a net loss of 32.5 billion won last year. This year is tentatively expected to be worse than last year, a high-ranking official of the company. Many major franchises such as coffee and chicken also predict that their operating profit this year will decrease by 20 to 30 percent compared to last year. The cost factors such as a minimum wage increase are increasing amid market saturation and sluggish domestic consumption.
The government's emphasis on co-existence with shop owners on large franchise franchises is another factor that undermines business appeal. As the government and the ruling party have recently decided to push for ways to allow franchisees to form a labor union, a sense of crisis is growing. "It is questionable who will be able to start a franchise with the permission of the union as well as the need to co-exist with the franchise owner according to the guidelines of the authorities," said a franchise representative. "We need to recognize that Franchise is a business that creates value-added, boosts the economy, and creates jobs, but the reality is that it is seen as a bad business that squeezes franchisees," he said.