Domestic chicken franchises have a distinct three-tier structure: headquarters (brand), supplier, and franchisee. While headquarters sales have increased over the past two to three years, the gap between average sales per store has widened, with a decline observed. The Investor
The top three companies (BHC, BBQ, and Kyochon ) each reportedly have domestic sales of approximately 500 billion won , demonstrating high brand concentration.
Franchises account for approximately 70% of chicken stores, driving standardization and scaling across the industry. The Investor
division | Key items | Issues/Memos |
|---|---|---|
| raw materials | Chicken, frying oil, powder/sauce, packaging materials | The impact of raw materials and exchange rates, and the shift to eco-friendly packaging. |
| equipment/devices | Fryer, oven, refrigerator/freezer, ventilation | Energy costs, safety, and automation demands |
| IT/Operations | POS·Delivery Integration·Inventory/Ordering | Delivery app commission and settlement structures need to be optimized. |
| distribution | Cold Chain/Last Mile | Responding to nighttime peaks and weekend volatility |
| Human Resources/Training | Cooking Standards, Safety, and Hygiene | Manual and LMS to mitigate turnover rate |
Raw materials/processing : slaughterhouse/processing, seasoning/powder OEM, packaging materials (eco-friendly/oil-resistant)
Equipment : Fryer/oven (electric/gas), air purifier, small cold table
IT : POS, delivery app integration, order/wait/pickup queue management
Logistics : Mixed refrigerated and frozen products, with demand concentrated on weekend nights.
Long-term contracts between headquarters and suppliers, and a high proportion of bulk purchases between franchisees and headquarters (a trend toward strengthened monitoring of rebates and cost structures). Chosun Ilbo
Delivery preference is firmly established : The issue of delivery fees (averaging 24%) is growing along with the proportion of deliveries in the metropolitan area . Korea Bizwire
The explosive power of events/exposure : Searches and orders surge after the "Kkanbu Chicken" store incident on October 30, 2025 → Confirming the ripple effect of real-time exposure. Korea Joongang Daily
Overseas K-chicken demand : Global expansion accelerates ( 184 new overseas stores opened in 2024 ). Pulse
field | Application/Effect |
|---|---|
| Smart POS + Delivery App Integration | Integration of ordering, settlement, coupons, and advertising execution (visualization of fees) |
| Cooking Automation | Oil management, time/temperature standardization → reduced quality deviations |
| Demand forecasting | Production/staffing optimization based on day of the week, time of day, promotion, and weather |
| ESG packaging | Integrated oil-resistant paper/pla specifications to reduce waste |
item | Scope/Comments |
|---|---|
| Initial investment | Store size: 15-25 pyeong, including facilities, interior, and deposit (varies by brand) |
| Sales/Profit | Peak times and increased dependence on delivery, with delivery commissions and promotional costs becoming variables. |
| Cost structure | Transparency in raw materials, oil, packaging materials, royalties, logistics costs, and rebate structures is crucial for CM Asia. |
| risk | Fees, labor costs, exchange rates/grains, night work, reviews, and customer service sensitivity |
Note: While franchise headquarters sales increased between 2022 and 2024, average store sales decreased by approximately 7.6% , indicating pressure on profitability (average indicator across all industries). Chosun Ilbo
There is a need to transition to eco-friendly packaging, manage waste oil, and enhance transparency in origin and supply chains.
The Fair Trade Commission operates a franchise information and disclosure system and a dispute resolution agency (franchise sector) → Contributes to mitigating information asymmetry. Global Practice Guides
danger | detail | react |
|---|---|---|
| Delivery fee | Average commission and advertising costs of 20% | Multi-channel (packaging/pickup), proprietary app/membership, and fee structure monitoring ( Korea Bizwire ) |
| Cost/Exchange Rate | Chicken, oil, packaging, and exchange rates | Futures/long-term contracts/alternative oil/standard integration |
| Regulation/Dispute | Contracts, Rebates, and Information Disclosure | Utilizing standard contracts, cost disclosure, and KOFAIR consultation ( Global Practice Guides ) |
| Brand saturation | Overcrowding and encroachment on commercial districts | Decision-making on store opening and withdrawal based on commercial district data |
characteristic | Directionality | Basis/Notes |
|---|---|---|
| Demand (domestic) | Consolidated ~ gradual + | Delivery stickiness + event/sports season impact |
| Profitability (Affiliate) | Continued pressure | Commissions/Advertising/Cost/Labor Costs, Gap Between Headquarters and Store Owners ( Chosun Ilbo ) |
| Overseas sales | increase | BHC, BBQ, and Kyochon accelerate overseas expansion ( Chosun Biz ) |
| regulatory environment | gradual improvement | Correcting Unfair Delivery App Terms and Strengthening Disclosure of Franchise Information ( Chosun Ilbo ) |
Short-term (domestic) : Optimizing delivery fees and advertising costs, separating menus and pricing for takeout and pickup. Korea BizWire
SMEs (Headquarters) : Restoring shareholder trust through transparency in cost, rebate, and logistics, standard contracts, and data sharing. CM Asia
Growth Axis (Overseas) : Establishing local partners and supply chains to meet the K-chicken boom, strengthening each brand's unique selling point. Chosun Biz+1
Policies and Systems : Actively utilize Fair Trade Commission and local government disclosure/dispute resolution systems to improve industry trust by eliminating information asymmetry. Global Practice Guides
One-line summary:
Domestic sales are putting pressure on profitability, while overseas growth is driving growth. The key to chicken franchises in 2025-26 is a two-track approach: transparency in delivery fees and costs , and accelerated overseas expansion .
