Burger, fries and a milkshake from 5 Guys are seen on this 2023 file photograph. Korea Occasions photograph by Lee Web optimization-hyun
American hamburgers grew to become a staple for Lee U-chan, a 29-year-old workplace employee, throughout his 18-day journey throughout the USA from the East Coast to the West Coast in 2023.
Again in Korea, nevertheless, he finds U.S. chain burgers too costly to take pleasure in.
“In Korea, the distinction in style between U.S. chain burgers and Korean manufacturers isn’t large enough to justify the value hole,” Lee informed The Korea Occasions. “If I’m going to spend that a lot, I’d moderately go to an unbiased restaurant that serves actually good meals.”
At Lotteria, one in every of Korea’s largest homegrown burger chains, single burgers usually value about 6,000 gained ($4.06) to 9,000 gained. At 5 Guys, a U.S. burger chain, costs in Korea are twice as costly, starting from about 13,000 to 17,000 gained.
Lee’s viewpoint is one rationalization for the restricted success of Western burger chains in Korea, with many customers concerning their larger costs as burdensome amid rising dwelling prices.
On Wednesday, Hanwha Galleria, the operator of 5 Guys in Korea, agreed to promote the enterprise to a personal fairness agency, simply two and a half years after the model’s native launch, because it shifts its focus again to malls.
It’s not the primary time a Western burger model has been put up on the market or exited the Korean market.
Tremendous Duper, a San Francisco-based connoisseur burger chain, opened its first Seoul outlet in 2022. The corporate posted a internet lack of 1.7 billion gained the next yr and exited the Korean market this March.
JK Enterprise, which operated Gordon Ramsay Burger — a model based by and named after the British superstar chef — in Korea, offered the enterprise final yr after its dad or mum firm posted an working lack of 1.9 billion gained in 2023.
The previous’s burgers had been priced between 8,300 gained and 13,900 gained in Korea, whereas a lot of the latter’s single objects had been priced within the 30,000-won vary, with top-priced menu objects reaching 140,000 gained.
Burgers, fries and milkshakes from Tremendous Duper are seen on this 2023 file photograph. Korea Occasions photograph by Lee Web optimization-hyun
Western burger manufacturers stay below pressure in Korea. Final yr, Shake Shack, an American burger chain, recorded an working lack of 1.9 billion gained in Korea, based on the Monetary Supervisory Service’s disclosure system.
Different international burger chains have confronted comparable outcomes previously. Wendy’s, a U.S. model, entered the Korean market in 1984 and expanded to about 40 retailers, however in the end exited in 1998, within the aftermath of the Asian monetary disaster.
Against this, home burger chains are delivering stable outcomes. Mother’s Contact posted report gross sales of 417.9 billion gained final yr, up 14.7 % from a yr earlier. Lotte GRS, which operates Lotteria, reported gross sales of 536.3 billion gained within the first half of this yr, up 11 % from a yr earlier.
McDonald’s, an American model that costs its burgers at ranges corresponding to home chains, additionally posted sturdy leads to Korea. Its native unit posted report gross sales of 1.25 trillion gained final yr, up 11.8 % from a yr earlier.
Choi Chul, a professor of client economics at Sookmyung Girls’s College, stated the Western manufacturers’ struggles mirror a standard notion amongst Korean customers that burgers are usually not usually meals folks pay excessive costs for.
Choi added that top inflation and a sluggish economic system are making customers extra price-sensitive.
“Even youthful customers, who are likely to want burgers greater than different generations, really feel the burden when buying energy is weak,” he stated. “Within the postpandemic slowdown, there may be merely much less room in customers’ wallets.”
