Yeondon Bolkatsu Owners "Monthly Sales of 30 Million Won False and Exaggerated"
Theborn Korea "No Promise of Profit Margin Made"
Franchise Owners Hold Rally and File Complaint with Fair Trade Commission Against Theborn Korea
The Born Korea, led by CEO Baek Jong-won, has completely denied the controversy over false and exaggerated profit rate promises raised by some franchisees of 'Yeondon Bolkatsu,' one of its franchise business brands.
On the 18th, The Born Korea issued a statement saying, "Recently, some franchisees have claimed that the company made false and exaggerated promises regarding sales and profit rates during the franchise recruitment process, and some media reports have cited these claims," adding, "The claims made by some franchisees are clearly not true."
The Born Korea explained, "The company has never promised false or exaggerated sales figures or profit rates during the recruitment process of Yeondon Bolkatsu franchises," and "During the franchise contract signing process, we transparently provided information such as the average sales of stores nationwide, cost ratios, and profit and loss based on objective data."
Some franchisees claimed that The Born Korea presented an expected monthly sales figure of over 30 million KRW, but according to The Born Korea, they provided franchisees with an expected sales estimate of about 17 million KRW per month for Yeondon Bolkatsu in 2022. They explained that the average monthly sales of Yeondon Bolkatsu franchises are not lower compared to other similar takeout brands.
The Born Korea denied the claims that it unilaterally refused to lower or raise the prices of supplies, stating, "We have reduced the cost of goods to coexist with franchisees, and the claims that the company unilaterally refused to lower or raise prices are completely false." They added, "Regarding Yeondon Bolkatsu franchises, from November 2022 to August 2023, the supply price of major ingredients for key menu items was reduced by an average of about 15%," and "After the launch of new menu items, the supply price of major ingredients for those menus was also reduced by up to about 25%."
Earlier, Yeondon Bolkatsu franchisees demanded a minimum profit guarantee and took collective action, including filing a complaint with the Fair Trade Commission. According to the franchisees and the National Franchisee Council, Yeondon Bolkatsu franchisees claim that the headquarters attracted franchisees by presenting an expected monthly sales figure of over 30 million KRW, but the actual sales fell short of even half of the estimate. They plan to hold a rally in front of The Born Korea headquarters this afternoon and submit a complaint to the Fair Trade Commission.
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