Riders' Demand for Delivery Fee Increase Leaves Self-Employed and Consumers 'Distressed'
"Base Delivery Fee Has Been 3,000 Won for 7 Years... No Burden of Increase on Self-Employed and Consumers"
Baemin States "Current Baemin Riders' Delivery Fees Are Industry's Highest Level"
Experts Say "Economic Conditions Are Poor... Questions About Appropriateness of 'Increase Demand' Are Inevitable"
[Asia Economy Reporter Park Hyun-joo] "Delivery fees going up again? The delivery fee is bigger than the food itself.", "It’s a bit inconvenient, but I guess I’ll have to start taking out food myself."
As Baemin (Baedal Minjok) delivery riders are demanding an increase in the base delivery fee and have announced a strike, sighs from self-employed business owners and consumers are growing deeper. The union argues that the base delivery fee, which has been frozen for seven years, must be raised to protect the riders' basic livelihood.
On the 13th, the Baemin branch of the Delivery Platform Division of the Korean Confederation of Trade Unions (KCTU) Service General Union held a press conference, stating, "While the minimum wage has increased by 65% over seven years, the base delivery fee remains at 3,000 won," and announced that they had applied for dispute mediation at the Central Labor Relations Commission on the 6th. The union has negotiated with the company eight times since last September but failed to reach an agreement. They warned that if no agreement is reached, they will hold a large-scale rally in front of Baemin headquarters on the 23rd and proceed with strong actions including a strike.
Self-employed business owners who heard the news are showing signs of distress. Choi (in his 50s), who runs a snack bar in Bulgwang-dong, Eunpyeong-gu, Seoul, said, "Delivery has increased a lot due to COVID-19. When delivery fees are expensive, it can go up to 8,000 won, so I raised the delivery fee by 1,000 won some time ago. If the delivery fee goes up any more from here, it will really be tough," sighing deeply.
Consumers also show negative reactions to the delivery fee increase. Park, a worker in his 20s, said, "Since I live alone, I often eat delivery food, but the delivery fee is always a burden," adding, "3,000 won delivery fee is now laughable, and sometimes it goes up to 5,000 to 6,000 won. If it goes up any more from here, I don’t think I’ll be able to order delivery anymore."
On July 26th, delivery motorcycles were lined up waiting in front of Dongdaemun Market in Seoul. The photo is unrelated to specific expressions in the article. [Image source=Yonhap News]
The union claims that if promotional costs are reduced and the base delivery fee is raised, there will be no increased burden on self-employed business owners and consumers. The KCTU Baemin Riders Union explained, "We charge self-employed business owners 5,000 won for delivery, and if the delivery distance exceeds 3 km, we charge 8,000 won, but our base delivery fee is 3,000 won. That means 2,000 won or 5,000 won remains, and the company uses this remaining amount for promotions."
They continued, "Our claim is not to raise the delivery fee. We want to increase the proportion of the base delivery fee within the existing delivery fees of 5,000 won or 8,000 won instead of promotions," adding, "Ultimately, self-employed business owners and consumers pay the same amount as now, so the increased burden is not passed on to them."
They also argued that some cases spreading through the media and communities are distorting perceptions about riders’ annual salaries. The KCTU Baemin Riders Union said, "People who say they earn several million won or 10 million won a month are in the top 0.1%. To earn that much, you have to work 15 hours a day, every day of the month, 365 days a year, without even eating."
They also claimed that the amount riders have to bear personally is large. They said, "For people in their 20s and 30s, motorcycle insurance costs 7 million won a year, and sometimes up to 10 million won. Including fuel, maintenance, and food expenses, there is nothing left," adding, "If you work a lot, you have to replace your motorcycle every 2 to 3 years."
On the other hand, Baemin stated in interviews with multiple media outlets on the same day, "Currently, Baemin riders’ delivery fees are among the highest in the industry. At the end of last year’s collective bargaining, the dispatch brokerage fee paid by riders was already abolished," adding, "We understand that the proportion of KCTU Service Federation members among all riders is not large. There have been several strikes this year, but there has been no major disruption in delivery operations."
Experts analyzed that the economic situation is very difficult due to COVID-19. Professor Lee Eun-hee of Inha University’s Department of Consumer Studies said, "Self-employed business owners are struggling due to COVID-19, and consumers find it difficult to bear delivery fees due to price increases," adding, "In this difficult situation for everyone, questions inevitably arise about whether the demand for delivery fee increases is appropriate."
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