Convenience Stores Thrive As A Slump-Free Business In South Korea Amidst Economic Slowdown
Convenience stores continue to boom as a slump-free business venture in South Korea amid lingering economic slowdown. Korea Times reported Wednesday that the increasing number of single-member households has stimulated the growth of convenience stores in the country.
In addition to this, the shifting consumption patterns of the consumers has also contributed to the continuous expansion of South Korean convenience stores. Majority of South Koreans prefer to buy ready-made meals which they think are more convenient, especially to those who living alone.
CU, South Korea's largest convenience store chain, is expected to open its 10,000th shop in the first half of 2016. Second largest convenience store GS25 forecasted to surpass the 10,000-mark in the latter part of the year.
Reports revealed that the number of convenience stores in the country is expected to top 30,000 in the current year.
"Convenience stores are popular among the would-be self-employed because of their stable and competitive business structure," an industry executive said. "If they enter into an era of 10,000 stores, the win-win effects will increase for both franchise headquarters and affiliated stores."
On the other hand, more convenience stores in South Korea are now offering self-serve coffee to expand their market.
"I think convenience store's coffee is drinkable and for that price, it's actually good," Lee Seo Yeon told Yonhap News Agency Monday. "Franchise stores' coffee may taste better, but it's too expensive for me to drink several cups a day."
Stores like GS25, 7-Eleven and CU have opened their own coffee services to join the competition.
"With more consumers conscious about their budget, convenience store coffee is expected to become a major trend as its prices are about one quarter of franchise brands," said Hwang Woo Yeon, a coffee business manager at 7-Eleven. "We will target consumers who want to spend their money smartly during the economic slowdown."
"As convenience store coffee is for take-out customers, it doesn't require additional rental fees. That's why they can sell quality coffee at cheap prices," said Yoo Cheol Hyun, CU official.
