Americano Sales Soar 650% with 500-Won Promotion
Franchise Store Revenue and Visitor Numbers Surge
Employees Complain of Overwork... Impact Spreads to Nearby Small Businesses
The brand discount event led by Theborn Korea CEO Jongwon Baek has achieved its intended results. As franchise store sales and visitor numbers surged, some franchisees, who had been struggling with sluggish business due to a series of controversies, are now seeing some relief. However, as the dramatic price discounts drew crowds of consumers, employees at Theborn Korea franchise stores complained of overwork, and nearby small business owners criticized the event for exacerbating their own sales declines.
According to Theborn Korea on June 17, its coffee brand Paikdabang saw a 46% year-on-year increase in customer visits during a focused promotion centered on popular beverages this month, and a more than 150% increase on the day of the event. During the discount event from June 10 to 12, when Americanos were sold for 500 won, Americano sales increased by about 650% compared to the same period the previous week, and new Paikdabang membership sign-ups rose by about 150% over the same period.
Paikboy Pizza also reported growth, with order volume up 150% and sales up 130% compared to the same period last year. In addition, sales of signature menu items by brand saw significant increases: Yeondon Bolkatsu Tuyulchi (1,356%), Hongkong Banjeom Jjajangmyeon (904%), Hanshin Pocha Dakbal (833%), Rolling Pasta Carbonara (462%), Yeokjeon Udon Naengmyeon (451%), and Saemaeul Sikdang Yeoltan Bulgogi (304%).
The number of visiting customers also rose. From May 13 to May 31, the number of customers visiting franchise stores participating in Theborn’s integrated discount event increased by more than 65% year-on-year on event days. From June 1 to June 10, the total number of visitors to franchise stores increased by 15.7% compared to the same period last year. On the day of the event, the increase was over 57%.
A Paikdabang coffee shop, operated by Theborn Korea, offering iced Americano and hot Americano for 500 won during a discount event on the 10th at a Paikdabang store in Seoul. Photo by Yonhap News
Previously, on May 6, CEO Baek announced that he would suspend all broadcasting activities to focus on management. This was due to serious sales declines at some franchise stores caused by ongoing controversies since February, including issues with product quality, errors in country-of-origin labeling, and hygiene problems at festival sites involving Baek and the company headquarters. In fact, according to sales data for Theborn Korea obtained by Democratic Party lawmaker Oh Sehee from the seven major domestic credit card companies, sales fell by up to 12.8% at Paikdabang, up to 18.3% at Hongkong Banjeom, up to 13.8% at Hanshin Pocha, and up to 19.0% at Yeokjeon Udon.
To minimize losses for franchisees, CEO Baek pledged to provide 30 billion won in support and to establish a co-prosperity committee. As a result, since last month, a ‘relay discount event’ involving 20 brands including Paikdabang and Hongkong Banjeom has been held, with all costs covered by headquarters. For example, when a 1,700-won Americano is sold for the event price of 500 won, headquarters reimburses franchisees 1,200 won.
However, some point out that while this discount event succeeded in attracting customers as a short-term promotion, it cannot be a fundamental solution. In particular, there were even cases of franchisees collapsing from overwork during the event period, leading to calls for co-prosperity measures beyond excessive discount policies.
Some online communities drew attention with posts such as, “The Paikdabang owner just collapsed from overwork and someone must have called for help. Paramedics are checking on the owner in the ambulance,” and, “Fortunately, the owner is conscious. It’s been a war since yesterday, and four part-timers are still fighting the battle. This is the sad reality for self-employed people in Korea.”
There were also employees requesting a ‘boycott’. Some posted photos of depleted ice supplies on social media, while others shared comments such as, “Worked five hours today and sold 280 cups,” “Barely survived today,” and “Please, I beg you, boycott us.” One store employee posted a photo of a sign reading ‘No dine-in’ along with a picture of hundreds of iced Americano cups waiting to be served.
There are also claims that the event posed a threat to the survival of nearby cafes. In fact, owner A, who runs a private cafe next to a Paikdabang store in Seoul, said, “During the Paikdabang event, my sales fell by more than 20% compared to usual. I just waited for the three-day event to end.” An employee at another franchise cafe, B, also said, “Normally, the lunch hour is so crowded with office workers that there’s no room to move, but during the Paikdabang event, it was completely empty. I realized just how powerful a 500-won price can be.”
An industry insider commented, “I understand that CEO Baek is making multifaceted efforts to save the company, even using his own funds, but the approach seems too simplistic. It looks difficult to restore a brand image that has already been damaged just through discount events. The most important thing is to quickly come up with support measures that truly embody co-prosperity.”
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