Fair Trade Commission selects 100 Good Franchise Companies including Coffee Bay, Seven Eleven, and Ediya... Benefits such as loan interest rate reductions

188 Billion KRW Support Provided to 53,132 Franchise Owners Struggling Due to COVID-19

[Sejong=Asia Economy Reporter Joo Sang-don] The Fair Trade Commission and the Korea Fair Trade Mediation Agency selected 100 franchise headquarters as "Good Franchises" on the 13th, which supported approximately 18.8 billion KRW through reductions in advertising and promotional expenses and royalty discounts to a total of 53,132 franchise stores throughout last year.

In September of last year, the Fair Trade Commission accepted applications from companies for one month, and an evaluation committee composed of experts such as lawyers, professors, and franchise transaction specialists reviewed the degree of financial support to franchise stores, including royalty discounts, support for advertising and promotional expenses, and reductions in raw material supply prices, as well as any violations of the Franchise Business Act. Based on this, a total of 100 franchise headquarters were selected as Good Franchises.

By industry, the majority of franchise headquarters were in the food service sector, including 22 Korean cuisine brands, 13 coffee brands, 12 chicken brands, and 8 snack brands. The rest included 3 in the education service sector and 4 in convenience stores.

The franchise headquarters selected as Good Franchises supported a total of 53,132 franchise owners with 18.8 billion KRW throughout last year. The support methods included reductions in advertising and promotional expenses (37.3%), royalty discounts (31.4%), and operational fund support (18.6%).

Among the selected franchise headquarters, Coffee Bay, Korea Seven (7-Eleven), and Ediya were evaluated as having best practiced win-win cooperation with franchise stores by fully covering advertising costs, supporting the handling of near-expiration products, and providing free labor consultations, respectively, and were selected as "Excellent Win-Win Model Franchises."

Franchise headquarters selected as Good Franchises will receive a 0.6 percentage point reduction in interest rates when borrowing policy funds from the Small Enterprise and Market Service until December 31 of this year. When receiving guarantees from the Korea Credit Guarantee Fund, guarantee fees will also be reduced by 0.2 percentage points. They will receive bonus points (up to 3 points) in the Fair Trade Agreement compliance evaluation and can use the Good Franchise certification mark throughout 2022.

A Fair Trade Commission official said, "We expect that this selection of Good Franchises will help spread a culture of coexistence in various ways throughout the franchise industry beyond just financial support," adding, "The Fair Trade Commission and the Mediation Agency will continue to activate the Good Franchise project to further strengthen coexistence and innovation in the franchise market."