Store Owners, Riders, and Labor Union All Oppose: What Is Baemin's 'Roadrunner'? [Why&Next]

Backlash Spreads Among Store Owners, Riders, and Labor Union
Parent Company DH Eyes Service Fees Over Dividends
Service Stability Issues, Including Variable Delivery Fees, Under Scrutiny

Baemin's recently piloted 'Roadrunner' system is facing strong backlash from stakeholders. Not only Baemin-affiliated store owners and the rider industry, but even the company's labor union have unusually united in their opposition. While the company claims the system is intended to improve the efficiency of its delivery service, industry insiders interpret it as a move by parent company Delivery Hero (DH) to recoup its investment.

According to industry sources on October 13, Baemin will introduce the Roadrunner system in the Jeju region on October 22. The company is moving to expand the beta service, which is currently operating in select areas such as Osan and Hwaseong in Gyeonggi Province, nationwide. A Baemin representative explained, "Roadrunner is one of several systems we have tried to enhance and advance the quality of our delivery service."

Baemin Connect Rider. Woowa Brothers

Roadrunner is a delivery rider-exclusive application developed by Baemin's parent company DH, replacing the existing Baemin Connect app. Whereas Baemin Connect allowed riders to log in at their preferred times and accept or decline delivery requests as they came in, Roadrunner requires riders to reserve their working hours in advance and then perform deliveries only during those scheduled times.

There will also be restrictions on the delivery range. According to the Association for Fair Platforms for Store Owners, monitoring of the pilot areas revealed that 'distance restrictions' occurred almost daily. When this restriction is in place, restaurants outside a certain radius do not appear on the consumer order screen, making it impossible to place orders from those locations. Store owners face reduced exposure and fewer customer inflows, while riders lose autonomy over their deliveries and see a decrease in the number of orders they can fulfill, leading to a structure where both parties may lose out.

Within the industry, there is growing interpretation that Roadrunner is a tool for DH to 'recover its investment.' Since acquiring Baemin in 2021, DH has collected approximately 950 billion won in dividends from the company. However, as political criticism mounted over 'outflow of national wealth,' there is speculation that DH is now seeking to recover profits through service fees instead of dividends.

Food delivered ordered through a food delivery platform. Yonhap News

DH's urgency in recouping its investment in Baemin is believed to stem from concerns over Baemin's shrinking market position amid intensifying competition in the domestic delivery platform market. Coupang Eats is mounting a particularly aggressive challenge. According to Mobile Index, from January last year to August this year, Coupang Eats' monthly active users (MAU) rose by 112%, from 5.53 million to 11.74 million, while Baemin's MAU increased by only 3%, from 22.45 million to 23.06 million during the same period. In the Seoul metropolitan area, Coupang Eats is reported to have already surpassed Baemin.

If Roadrunner is expanded nationwide, the volume of service fees flowing to DH is expected to increase astronomically. There is a similar precedent with Yogiyo, which DH previously operated. After introducing Roadrunner, Yogiyo paid DH 170.9 billion won in service fees in 2022 and 118.7 billion won in 2023, with approximately 52.2 billion won of that estimated to be related to Roadrunner usage fees. Considering Yogiyo's revenue was around 250 billion won at the time, this means that 25% of its revenue over two years was paid out in service fees. If this is simply applied to Baemin, the service fees Baemin would pay to DH with nationwide Roadrunner implementation could reach 1 trillion won.

In the pilot regions, there are also concerns about system stability. A rider using Roadrunner in Hwaseong City commented, "There are too many cases where the delivery fee I receive is less than what was indicated when I accepted the order after Roadrunner was introduced," adding, "The process of contacting the support center to receive the difference is also cumbersome." There is also internal discontent within Baemin, with complaints that "while the focus is on transitioning to DH's tool, the competitiveness of our service is declining and only the head office's profit structure is being strengthened."

Baemin stated, "Since Roadrunner is still a beta service, specific details such as the expansion of service areas have not yet been decided."