"Stop Discounts and Raise Prices"... Self-Employed Criticize Baemin's Packaging Fee Imposition

New Store Owners to Be Charged Commission Starting Next Month
Existing Store Owners to Be Subject from April Next Year
Strategies to Encourage Phone Orders from Self-Employed

"The store handles the packaging and the customer just picks it up, so why does the platform charge a commission in the middle?"

Lee (34), who runs a private cafe in Musil-dong, Wonju-si, Gangwon-do, decided not to accept takeout orders from Baemin starting this month. This is because Baemin notified that it would charge a brokerage fee even for takeout orders. About 20% of the orders coming into Lee's store are from takeout customers.

Lee frowned, saying that if a commission is charged on takeout orders, the store's losses would be considerable. Instead, he is trying to attract takeout customers by posting promotional messages on Naver and Danggeun Market.

[Image source=Yonhap News]

As Baemin announced that it will impose takeout commissions on new merchants starting next month, complaints from self-employed business owners are growing. Baemin plans to gradually impose commissions on existing merchants as well, raising concerns that dining prices may also rise accordingly.

The current commission Baemin charges on delivery orders is 6.8%. If the same level of commission policy for takeout orders is implemented from next month, new merchants will have to pay a 680 won commission for a 10,000 won takeout order. However, Baemin has postponed the commission imposition for existing merchants until March 31 of next year.

Since introducing the takeout order service in August 2020, Baemin has postponed commission charges seven times. This was to share the pain experienced by merchants due to COVID-19. However, following the Fair Trade Commission’s announcement in April regarding the implementation review of delivery app self-regulation measures, Baemin indicated a policy change to activate takeout orders through service improvements rather than simply waiving commissions. Among the three major delivery platforms, Yogiyo is currently the only company charging commissions on takeout orders.

Some worry that Baemin’s policy could lead to an increase in dining prices. In fact, some self-employed business owners are considering raising food prices in line with the imposition of takeout commissions. Kim (57), who runs a Chinese restaurant in Chuncheon-si, Gangwon-do, sighed, "I want to stop using delivery platforms, but a significant number of orders come through Baemin. I am thinking of raising the price of a 7,000 won bowl of jajangmyeon by about 400 won, but I am very worried that regular customers might leave."

On the self-employed online community "Apeunikka Sajangida" ("Because It Hurts, I’m a Boss"), posts about stopping takeout order discounts have been posted one after another. One merchant said, "Until now, since there was no platform commission, we gave takeout customers a discount of even 5,000 won and provided complimentary drinks, but I don’t think we can continue these discount services going forward."

Franchise store owners, who cannot set food prices autonomously, are even more frustrated with Baemin’s policy. Lee (29), who runs a franchise chicken restaurant in Gwangjin-gu, Seoul, complained, "Franchises buy ingredients from the headquarters and operate, so without headquarters’ instructions, we cannot raise prices. The only option is to encourage customers to order by phone."

Baemin’s position is that takeout orders require server operating costs just like delivery, so commissions must be charged. A Baemin representative explained, "Takeout orders are mediated through the platform just like delivery, and the same level of development personnel and maintenance costs are incurred," but added, "We have maintained a free policy so far to share the pain of dining operators struggling due to COVID-19." The representative also added, "As an additional win-win measure, we plan to implement a takeout order activation policy that refunds 50% of customer discount costs during takeout discount marketing."