After the Introduction of 'Differential Commissions' on Delivery Apps
Dual Pricing System Spreads Despite Lower Commission Rates
Delivery Menu Prices Higher Than In-Store Menu Prices
Ediya Coffee Raises Delivery App Prices by 300 to 500 Won
Some Mom's Touch and Goobne Franchisees Also Adopt Dual Pricing System
As the trend of rising dining-out prices continues this year, consumer burdens are increasing due to the spread of the 'dual pricing system,' where delivery menu prices are charged higher than in-store prices. In particular, despite many store owners seeing reduced commission rates after the recent introduction of 'differential commissions' on delivery applications (apps), more dining businesses and store owners are adopting the dual pricing system, intensifying consumer dissatisfaction.
According to the industry on the 18th, Ediya Coffee, Mom's Touch, and Goobne Chicken have recently implemented the 'dual pricing system' in all or some of their stores. The dual pricing system refers to setting different prices for dining in-store and for delivery. Currently, Lotteria, Burger King, McDonald's, KFC, Baskin Robbins, Popeyes, Hansot Dosirak, and Bon I.F. also operate dual pricing systems.
Ediya Coffee, which has about 3,000 stores nationwide, announced on the 18th that it will operate a 'delivery-only selling price.' Based on prices on external delivery platforms such as Baedal Minjok, Coupang Eats, and Yogiyo, the price of manufactured beverages except for Americano will increase by 300 won, and bakery items and RTD (ready-to-drink) beverages (products in containers) will increase by 500 won.
Ediya explained the background of the delivery app menu price increase by stating, "The burden on franchise operations has increased due to recent market environment changes and delivery commission hikes." The company added, "Even if 10,000 won worth of orders are sold through delivery, 4,000 won is taken as commission, so many store owners have appealed to raise delivery prices." They stated that the dual pricing system was introduced reluctantly due to high delivery commissions.
In fact, a survey conducted by the Consumer Public Interest Network targeting 502 dining business owners found that they identified 'delivery app commissions' as the biggest burden in operating their businesses. 47.6% responded that the burden of delivery app commissions increased, leading them to raise menu prices. 34.8% said they introduced the dual pricing system by setting delivery app menu prices higher than offline store prices.
Some chicken brands have not introduced the dual pricing system at the headquarters level, but some franchisees have raised delivery menu prices. The burger and chicken brand Mom's Touch recently saw 48 franchise stores begin applying the dual pricing system. Although the increase varies by store, delivery menu prices have risen by an average of about 15%.
However, the Mom's Touch headquarters is concerned that raising delivery menu prices could reduce sales and is advising franchisees to refrain from doing so. Under the current Franchise Transaction Act, the franchisor cannot regulate individual pricing policies of franchisees. Some Mom's Touch franchisees have requested the introduction of the dual pricing system to the headquarters since July last year, but the headquarters decided not to implement it, judging that the dual pricing system could lead to long-term sales declines.
Goobne Chicken, ranked fourth in sales among chicken brands, recently saw some franchise stores in Seoul and Gyeonggi Province raise delivery menu prices. The representative menu item 'Spicy Basa-sak,' priced at 19,900 won, has increased to 21,900 won in some stores, with delivery menu prices reportedly rising by 1,000 to 3,000 won. Goobne also stated that it is not considering introducing the dual pricing system at the headquarters level.
The dual pricing system in the dining industry has especially spread since last year. Most major burger brands such as Lotteria, McDonald's, KFC, and Popeyes have adopted the dual pricing system. Mega MGC Coffee and Compose Coffee also charge about 500 won more for delivery coffee prices. The dual pricing system continues even after Baedal Minjok, the number one delivery app, lowered its brokerage commission from 9.8% to 2.0~7.8% (excluding VAT) starting on the 26th of last month.
Baemin is applying differential commissions according to the win-win plan agreed upon last year in the delivery platform coexistence council. Differential commissions are a system that charges commissions differently based on the proportion of delivery sales of a business. The top 35% in sales are charged 7.8%, those exceeding the top 35% up to 80% are charged 6.8%, and those exceeding 80% up to 100% are charged 2.0%. Coupang Eats also plans to introduce the same differential commission system as Baemin starting next month.
Delivery app companies emphasize that the introduction of differential commissions will reduce the commission burden on store owners. Baemin stated, "On the first day of implementing the win-win pricing system, the burden on store owners decreased across all ranges," and "Even in the top 35%, where claims of 'commission increases' were made, the burden on store owners did not increase." However, store owners show low expectations for the 'differential commissions' introduced by delivery apps such as Coupang Eats and Baedal Minjok. In a survey conducted by the Consumer Public Interest Network targeting 502 dining business owners, only 26% believed that differential commissions would reduce their burden. It is interpreted that store owners expanded the adoption of the dual pricing system due to low expectations for differential commissions.
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