SEOUL, Jan. 10 (Korea Bizwire) — The number of new convenience stores in South Korea dropped last month, ostensibly due to this year’s minimum wage hike.
According to industry sources, a total of 83 stores were added by the three major convenience store chains CU, GS25, and 7-Eleven in December – 44, 25, and 14, respectively.
The figure marks a significant departure from that of last month, when the number of stores increased by over 200.
Even compared to the same time last year, the figure more than halved, which many experts believe is a direct result of the 16.4 percent minimum wage hike that has come into force this year.
The increased financial burden on convenience store owners has led to staff cuts and shorter opening hours in an effort to cut down on personnel expenses.
Owners of multiple stores have downsized their businesses while others opted out of re-signing their contract with convenience store chains.
“Though December is usually the least busy month for chain business contracts, given the comparison with a year ago, it’s safe to say the impact of a minimum wage hike has been reflected,” an industry official said.
“The number of store owners who decided not to renew their contract has increased. There are also a number of people who were initially interested in opening a convenience store but now have a wait-and-see attitude,” the official added.
Hyunsu Yim (email@example.com)