In Korea, Back Jong-won has become increasingly more popular. His rise to fame has occurred since he appeared in the TV program; ‘My Little Television’. In this program, he introduced his unique and easy recipes. He even earned the nickname ‘Housewife, Back’. If you haven’t already heard about him, you might think that he is a chef. However, he is actually an expert in restaurant management. He is an entrepreneur whose brand is affiliated with many restaurants, cafes, and even bars.
|▲ Baek Jong-won who has lots of franchise.|
His franchises are spread throughout Korea. He runs an estimated 28 different franchises with over 1200 locations all over the country. It is not unreasonable to assume that most eateries on the streets are his. He said that reason he operates so many franchises, is to make enjoyable cuisine that lessons the burdens on ordinary people. It is true that many consumers like his delicious and cheap cuisine but is he really lessoning the burden on us ordinary people?
Some owners of local restaurants and cafes near Mr. Back’s franchises are suffering from lost business. Since most owners who operate restaurants are also ordinary people, we should consider whether Mr. Back’s franchises really are helpful to ordinary people or not. If they are not, then we should come up with practical alternatives.
To get a better understanding of the situation, The Dankook Herald (DKH) carried out a survey exploring the perception and preferences between Mr. Back’s franchises and ordinary restaurant and cafes. The survey targeted people aged 10 to 60. This graph shows the results of the respondents to different questions. (Graph 1)
|▲ Graph 1|
If the respondents had to choose which restaurants to go to, 69% said they would pick one of Mr. Back’s franchises. The main reasons for their decision are taste and reasonable prices. (Graph 2)
|▲ Graph 2|
It is also interesting to point out that the respondents who preferred ordinary restaurants also said that their reasons for their decision were taste and reasonable prices. Seeing these results, the DKH can safely say, the most important factors that impact a customer’s choice are taste and price. 92% of respondents had a positive image of Mr. Back’s franchise treatment of customers. However, 63% had negative image of his franchise impact on local restaurants. The same percentage said that the number of his franchises should be decreased. (Graph 3)
|▲ Graph 3|
To have a closer look at the impact of franchises on local restaurants, the DKH interviewed restaurant owner, Jeong Dong-chae, whose business survived despite the introduction of various franchise restaurants near his location. “Customers go to the franchise restaurants when they are newly opened. However, they come back my restaurant as time passes,” he said. He also said that they return because of his extensive experience, unique menu and fresh ingredients, which are chosen by him, every morning at the market.
“The main shortcoming of franchises is their unified recipe. If they use other ingredients or offer different recipes, they have to pay a penalty”. He pointed out that this strict rule is the main obstacle which obstructs their ability to satisfy every customer.
In conclusion, we suggest some solutions based on these experiences. We approached our solutions from two perspectives, a personal and social viewpoint. Firstly, from a personal dimension, ordinary restaurants should be more competitive. This means price, taste, hygiene, atmosphere and interior must be appealing to the public. Among these, the most important qualities for customers are price and taste. Therefore, ordinary restaurants need to concentrate on making good tasty food at a reasonable price. As Mr. Jeong said, these can be realized by personally going to the market regularly and getting a grasp of customers’ tastes.
Secondly, from a social dimension, institutional support is needed, such as restricting the number of franchise stores in a specific range. While this can arouse backlash from owners of franchises, most people agree that dividing profits among many people is better than monopolizing profits by a specific and limited number of people.
Furthermore, enforcing this system can be helpful to franchises, because it prevents excessive competition between similar enterprises. To sum up our analysis, if Mr. Back’s franchises have added seasonings such as personal effort and social support, his purpose for helping better the lives of ordinary people can be truly realized.