GS25 in Mongolia and Paris Baguette in New York: Korean franchises go global

Industry

Published: 04 Oct. 2022, 16:27

GS25 in Mongolia and Paris Baguette in New York: Korean franchises go global

GS25's 100th store in Mongolia [GS25]

Korean convenience store chains and food franchises are going abroad and expanding their presence in the global market with new stores.

GS25 opened its 100th store in Mongolia, 16 months after entering the Mongolian market, according to the convenience store chain on Monday.

The company signed an agreement in September 2020 to receive royalties under a master franchise deal with Shunkhlai, a Mongolian holding company with 12 subsidiaries, including APU, which claims 70 percent of Mongolia’s liquor and beverage market.

“We focused on strengthening multi-functional aspects by applying localization strategies and effectively utilizing convenience store infrastructures, making up for the lack of restaurants, cafes and resting places in Mongolia,” said a spokesperson for GS25.

GS25’s newly opened Mongolian store is about 91 pyeong (3,238 square feet), located at the entrance of Gorkhi-Terelj National Park, a national landmark of Mongolia. The store’s size is about three times the size of a normal convenience store, enabling it to hold and sell around 8,000 different products.

Products of its coffee brand Cafe25 and the Mongolian traditional dumpling product newly introduced to stores in the country are popular products sold some 20,000 times a day.

The retail chain also entered the Vietnamese market in 2018 and currently operates 186 stores in Vietnam. It is also planning to open its first store in Malaysia early next year.

CU, a convenience store chain operated by BGF Retail, entered the Mongolian market in 2018 and currently runs 260 stores in the country.

The chain holds over 70 percent of the convenience store market share in Mongolia. Its expansion to Mongolia also helped around 40 domestic small- and mid-sized companies to enter the new market, as 30 percent of CU’s products are manufactured by such firms.

CU also entered the Malaysian market last year and is currently operating 120 stores.

Paris Baguette's branch in New York City [SPC]

Korean bakery franchises are also showing rapid growth in the global market. Paris Baguette, the bakery franchise run by SPC’s Paris Croissant, ranked 25th in the U.S. Franchise Times Top 500, according to the company on Monday.

The Franchise Times Top 500 began in 1999 and is an annual ranking of franchise brands by different factors, including sales in the United States. Paris Baguette ranked the highest on the list among all Korean franchise brands, climbing up 13 ranks from last year.

Paris Baguette, which entered the U.S. market in 2005, also opened its 100th U.S. store in the first half. Store locations include areas such as Times Square, Midtown and Upper West Side in New York. The bakery chain also has plans to open 100 stores in Canada by 2030.

“With the baking skills and bakery operation know-how we have compiled for 77 years, our efforts are being recognized in the United States,” a spokesperson for SPC said.

“We will strengthen ways to target the U.S. market and speed up expanding global business in different ways.”

BBQ's Oklahoma City branch [BBQ]

Fried chicken franchises are also jumping on the overseas bandwagon.

One fried chicken franchise, Genesis BBQ, opened its first store in Oklahoma last month, expanding its business to 20 states in the United States. Korean foods such as tteokboki (spicy rice cakes) and kimchi fried rice will also be sold.

“Korean fried chicken is loved by both Koreans and Americans, thanks to the Korean wave,” said the franchise owner of the BBQ store in Oklahoma.

The fried chicken chain is currently operating around 500 stores in 57 different countries, including the United States, Canada, Germany, Taiwan, Malaysia, Vietnam and Japan.

Kyochon Chicken, another fried chicken franchise in Korea, has 70 stores in six different countries, including Malaysia and the Middle East.

BHC Group plans to expand its chicken business in Malaysia in November and in Singapore next year, following its opening of stores in Hong Kong in 2018.

BY BAEK IL-HYUN [cho.jungwoo1@joongang.co.kr]