Coffee cup surcharge faces backlash from shop owners

Industry

Published: 30 Jan. 2022, 07:00

Coffee cup surcharge faces backlash from shop owners

The Environment Ministry announced on Jan. 24 that customers will be charged 300 won (25 cents) per single-use plastic or paper takeout cup starting in June. Customers can get the money back by returning the cup. [NEWS1]

A takeaway coffee will cost you 300 won (25 cents) more from June when a new government charge on single-use cups kicks in, and coffee shop owners are not happy about it.

“I will have to use the cash register every time someone hands me a disposable cup and give 300 won back, even if it’s not from my store,” a franchise bakery owner in Suwon, Gyeonggi, said. “Some customers are still unhappy about paying for a plastic bag. I’m worried that they might throw a tantrum if I charge them extra for a cup.”

The Environment Ministry announced on Jan. 24 that the 300 won charge for a single-use cup, whether it be a plastic or a paper one, will be compulsory at large food and coffee franchises from Jun. 10.

Customers can get that money back if they return the cup to any store that falls under the new regulation.

The measure is intended to tackle Korea's single-use plastic problem. The ministry estimates that franchise stores use 2.3 billion single-use plastic or paper cups a year, which is around 44 cups per person. Paper cups generally come with plastic lids.

Any large franchises with more than 100 branches that sells coffee, ice cream, baked goods, fast food, or any other beverage are subject to the rule, according to the ministry.

But franchise store owners are complaining that the ministry hasn't thought the plan through — especially because it applies to stores that rarely serve coffee, but will still be obligated to collect cups.

For example, a franchise store that sells hodugwaja, a small walnut pastry, is included in the list of companies subject to the rule even though it seldom sells beverages. Fast food chains Lotteria and Burger King are also included since both have over 100 branches.

Myungrang Hotdog, a domestic hotdog chain, is classified as a bakery franchise and has 651 branches in total. Companies that do not sell coffee won’t be subject to the rules, the ministry explained, but Myungrang Hotdog will be obligated to follow the rules as some of its stores offer coffee.

“There is some confusion over which franchise is subject to the rule,” said a spokesperson for the Environment Ministry, “so the ministry will soon make a notice on the issue.”

Busy locations are also expecting to struggle.

According to the FTC, low-cost coffee brand Mega Coffee is the third biggest among coffee franchises in terms of the number of branches and Paikdabang the sixth.

Known for cost-competitiveness, both companies mostly serve takeaways in small stores located in business districts.

The owners of such low-cost coffee franchises are particularly unhappy about the new rule.

Beverages are served in disposable cups at a franchise coffee shop in Seoul. [NEWS1]

“It gets really hectic in peak time when office workers come to get coffee,” said a coffee shop owner in southern Seoul. “Should I hand out 300 won on coffee that only costs 1,500 to 2,000 won each? We should limit the time when the cups can be returned, I think.”

Other store owners are worried about the waste piling up.

“I pay for my trash to be taken away," one person wrote on a website for small business owners on Jan. 24. “Am I getting paid to recycle other people’s waste?”

But the Environment Ministry maintains that the backlash is based on misunderstanding of the rules. Despite store owners' worries, they won't actually be required to pay the 300 won refund if a customer returns a cup to their store.

Instead, the cup will be tracked through a barcode that can be scanned when the cup is returned, and the store where they purchased it will fork out the 300 won.

"As we are aware that franchise owners have negative opinions on the rule, we will hold a meeting next month to explain the issue," the Environment Ministry said.

BY JEONG JIN-HO [shin.hanee@joongang.co.kr]