[Reporter’s Notebook] Small Capital Startup Owners Ultimately Hope for a Lottery Win

"Now, the only answer is the lottery. Buying a lottery ticket before heading to my shop on Monday has become my routine."

While covering the feature article "The Trap of Small Capital Startups," I ended up exchanging jokes with fellow business owners my age. When I mentioned going to buy a lottery ticket before opening the shop, someone replied, "Shouldn't you be hoping for lots of customers and a booming business instead?" But the answer came back that winning the lottery is the only way to pay off the debt incurred at the time of starting the business.

It's not that business is bad. His small beer pub, located in a busy area of the Seoul metropolitan area, is always bustling with customers despite its modest size. On good days, daily sales can reach 2.5 million won. And yet, he relies on the lottery, which is statistically a losing game. What has driven him to this point?

Many novice business owners, often called "prospective entrepreneurs," choose to open franchise stores with guaranteed brand recognition. Franchises collect various fees to maintain brand value, such as franchisee training fees, interior design costs, and supply margins (differential franchise fees) added to the logistics costs of raw and subsidiary materials. However, because the margin-setting process is not transparently disclosed, excessive margins can sometimes lead to unfair practices. In some cases, brokers emerge who seek to profit from expanding franchise locations. These brokers entice prospective franchisees by promising to waive various franchise and service fees at the start, without explaining contract clauses that could be detrimental. Ultimately, this lack of transparent information becomes a "trap of entrepreneurship."

There are ways to address these side effects. The head office can disclose the necessary information to franchisees and allow them to judge whether the terms are reasonable. High-interest loans provided to prospective entrepreneurs can be regulated through the lending business law. Related measures have already been proposed as "livelihood bills" by both ruling and opposition parties. However, the chances of these bills passing the plenary session appear slim. During the 21st presidential election, both parties promised to operate a joint task force to fulfill overlapping livelihood pledges, but political disputes have prevented even a start.

While politicians remain inactive, reality is taking a strange turn. Last week, the media reported that Saemaeul Restaurant, which had operated in Sinchon for 17 years, was closing due to management difficulties. The owner, a long-standing figure in Sinchon, posted a notice on the shop window: "Business has become difficult, and since I did not win the lottery, I am closing down." Both the owner of a "Baek Jongwon franchise" and the beer pub owner introduced earlier hope for a lottery win rather than a business boom.

How can it be right that the expectation of making a living is less than one in five million? Unless we change the industrial ecosystem that self-employed people face, they will continue to pin their hopes on improbable odds.

This content was produced with the assistance of AI translation services.