Convenience stores are in a state of emergency

As next year’s minimum wage was set at 9,860 won, up 240 won from this year, convenience store owners are increasingly aware of the crisis. Sales are at a standstill, but fixed costs such as electricity, rent, and labor are accumulating and increasing. The number of stores continues to increase, and competition is fierce.

According to the industry on the 21st, convenience stores that are open 24 hours a day are complaining about the burden after the minimum wage increase was decided. In terms of an hourly rate, it increased by 240 won, but in terms of monthly wage (based on 209 hours), it increased by more than 50,000 won from 2,010,580 won this year to 2,060,740 won.

For this reason, it was found that convenience store owners who previously hired and operated part-time workers were willing to reduce or eliminate part-time work hours and increase their own working hours in order to reduce fixed costs. In addition, there is a steady voice that it is unfair to apply the minimum wage to the convenience store industry, which has relatively low work intensity, on an equal basis with other industries.

Mr. A (43), who runs a convenience store in Seoul, said, “The rent has risen, and the electricity bill will continue to rise, but sales have not risen, so I think I need to use a way to reduce the working hours of part-time workers.” “I am still putting in part-time jobs for as little time as possible, but I am in a position where I have to make a decision to increase my working hours or give up nighttime or weekend operations even to save labor costs카지노사이트,” he said.

Currently, convenience stores are contracting with the head office to set business hours. If you operate 24 hours, you can earn more profits than stores that operate basic hours (18-19 hours). They can also receive subsidies for 24-hour operation, but they will give up this due to the burden of various fixed costs such as labor costs. However, until the contract period, I have no choice but to endure by crying and eating mustard.

Weekend pay is also a burden. Weekly holiday pay is an extra day’s wage for those who work more than 15 hours a week. The convenience store industry has been requesting that the weekly holiday pay be abolished for small businesses with less than five employees, but it was not accepted.

The Korea Convenience Store Owners Association issued a statement on the 19th and said, “With the minimum wage decision, there is no other way than to close convenience stores or reduce labor costs through nighttime unmanned operation and reduced employment.”

Convenience store sales have stagnated, but the number of stores continues to increase. Because of this, convenience store owners are competing more fiercely.

According to the ‘Sales Status of Major Retailers’ announced by the Ministry of Trade, Industry and Energy, the number of stores in Korea’s three major convenience stores ( CU , GS25 , and 7-Eleven) was 46,662 as of March this year. This is a nearly 35% increase compared to 2018 (34,664) five years ago.

When small and medium-sized convenience stores are added, the number increases even more. According to the Fair Trade Commission, as of 2021, 41 convenience store brands are operating 52,168 convenience stores.

With the increase in the number of stores, sales at convenience stores exceeded sales at large discount stores for the first time last year, but the operating margin is declining. This is due to the fact that competition between convenience stores has greatly increased promotional costs, and the popularity of stores near schools and amusement parks has suffered a blow to the business due to the Corona 19 incident.

Mr. B (55), who has been running a convenience store for over 10 years, said, “I think it is realistically difficult for the convenience store headquarters to support fixed costs such as electricity and rent.”

Leave a Reply

Your email address will not be published. Required fields are marked *