South Korea’s coffee shop craze is frothing over.
In fashionable retail and commercial districts of southern Seoul, nearly one in every two buildings boasts a coffee shop – evidence of a boom that has delivered dizzying growth for the likes of Starbucks and local chains.
But now the market is getting even more crowded, as convenience stores such as 7-Eleven offer 1,000 won (87 cents) cups, and smaller players are feeling the heat.
“We declared an emergency situation, gathered all employees eight times to debate strategies,” Moon Chang-ki, CEO of mid-priced coffee chain Ediya, the country’s largest operator by location with about 1,800 stores, told reporters recently. “If we sell at that price, our store owners won’t earn any margins.”
To compete, Ediya says it has instead focused on improving the quality of its coffee, and actually raised prices last year. Other chains have responded to growing competition by cutting back on store numbers and staff, or expanding overseas.
The number of chain and stand-alone coffee shops in South Korea more than tripled to about 49,600 in 2015 from 12,400 in 2011, according to Korea Contents Media – far faster than overall consumption of coffee, which Koreans have been drinking for decades. Read More