The Seoul Metropolitan Government said on Sunday it is looking for people to join its own franchise brand, which takes after cooperative purchasing associations where both the brand and franchise owners participate in management. (Image: Yonhap)
SEOUL, Apr. 23 (Korea Bizwire) — In a bid to overcome unfair industry practices, Seoul will create its own ‘social franchise’ that seeks to develop mutual interest between store owners and the brand following a series of power abuse scandals.
The Seoul Metropolitan Government said on Sunday it is looking for people to join its own franchise brand, which takes after cooperative purchasing associations where both the brand and franchise owners participate in management.
Under the new project, Seoul will create its own computer system, develop its own design, and provide management consulting for those who wish to join, including cooperative associations and small business owners.
The move comes after a series of power of abuse scandals, including the one surrounding former Mr. Pizza CEO Jung Woo-hyun who was sentenced to three years in jail and four years of probation for corruption and embezzlement.
With more than 5,700 franchises in South Korea, conflicts are growing between franchises and store owners.
Last year, a total of 265 complaints were filed with the Seoul government with regard to unfair practices at franchises, up significantly from 2013 when the figure stood at 137.
Against this backdrop, Seoul’s new franchise program will allow store owners to take part in securing cheaper ingredients, for instance, as a number of food franchises have been accused of forcing franchisees to opt for more expensive ingredients or products.
With the franchise model set to be established sometime this year, the Seoul government is taking a number of steps to protect the rights of workers.
Counseling visit services will take place at parks and subway stations for marginalized workers like janitors whose rights have been infringed upon. A support center for freelance workers will also be set up, as well as plans to introduce an ordinance protecting their rights.
In addition, urban development projects will be looked into more carefully, in an effort to help develop consensus between supermarket chains and local storeowners.
Hyunsu Yim (hyunsu@koreabizwire.com)
