Delivery Platform-Merchant Win-Win Council Holds 12th Meeting
Baedal Minjok and Coupang Eats Reach General Consensus on Final Win-Win Proposal
System Overhaul by Delivery Platform Operators Scheduled for Early Next Year
The 'Delivery Platform-Merchant Win-Win Council' has successfully reached a last-minute agreement on a commission win-win plan. Coupang Eats agreed to the proposal presented by Baedal Minjok, which applies a brokerage commission rate of 2.0% to 7.8% based on transaction amounts, resulting in a unified plan for the Baemin-Coupang Eats platforms. Merchants also judged that this win-win plan could help small business owners if implemented.
On the 14th, the Delivery Platform-Merchant Win-Win Council announced that the 12th meeting was held that afternoon. In the previous meeting, the council requested Coupang Eats to present a new win-win plan close to the mediation principles, and asked Baemin to review whether there were any parts of the current win-win plan that needed improvement. Baemin and Coupang Eats requested additional time to submit their final win-win plans, and both companies submitted their proposals on the 11th. The mediation principles suggested earlier by the public interest commissioners were to apply differential commission rates but keep the average brokerage commission rate below about 6.8%. They also recommended applying a maximum commission rate lower than the current 9.8%.
Lee Jeong-hee, Chairperson of the Delivery Platform-Merchant Win-Win Council, is briefing the results of the 12th meeting on the 14th at the Government Seoul Office in Jongno-gu, Seoul. Photo by Yonhap News
At the 12th meeting, Baemin proposed a plan based on transaction amounts: a brokerage commission of 7.8% with delivery fees of 2,400 to 3,400 KRW for the top 35%; a 6.8% brokerage commission with delivery fees of 2,100 to 3,100 KRW for the 35-50% mid-tier; a 6.8% brokerage commission with delivery fees of 1,900 to 2,900 KRW for the 50-80% mid-tier; and a 2.0% brokerage commission with delivery fees of 1,900 to 2,900 KRW for the bottom 20%. Additionally, Baemin included expanding the pilot program of 0% brokerage commission, previously applied in some traditional markets, nationwide.
Coupang Eats proposed: an 8.8% brokerage commission with delivery fees of 2,130 to 3,130 KRW for the top 35%; a 7.8% brokerage commission with delivery fees of 1,900 to 2,900 KRW for the 35-50% mid-tier; a 6.8% brokerage commission with delivery fees of 1,900 to 2,900 KRW for the 50-80% mid-tier; and a 2.0% brokerage commission with delivery fees of 1,900 to 2,900 KRW for the bottom 20%.
During the meeting, after discussing each company's win-win plans, Coupang Eats expressed that Baemin's proposal, which has lower brokerage commissions than its own plan, aligns better with the council's purpose, and agreed to implement the win-win plan as proposed by Baemin.
Regarding the win-win plans submitted by both companies, the merchant group expressed two opinions: first, given the many small business owners facing difficulties due to the recent economic situation, it is desirable to implement this win-win plan even if it has some shortcomings, as it could help them; second, that the plans proposed by both companies are insufficient to sufficiently alleviate the burden on merchants.
The public interest commissioners unanimously agreed that although the win-win plans by Baemin and Coupang Eats do not fully meet the expectations of the merchant industry, they believe these plans could help small business owners currently facing difficulties. They also stated that since this win-win plan is the first step toward coexistence and change in the delivery app market, ongoing discussions on win-win measures should continue, and the establishment of a related permanent organization should be considered. Furthermore, they urged that this win-win plan should not cause increased burdens in other areas due to a balloon effect.
With the win-win plan from Baemin and Coupang Eats finalized at this 12th meeting, each delivery platform operator will promptly update their systems to implement it. Baemin and Coupang Eats announced plans to complete system adjustments for the implementation of the win-win plan so that it can be applied and enforced early next year. The application period will be for the next three years.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
