Korea's $15 billion group catering market set for shakeup after Hanwha's Ourhome acquisition

Home > Business > Industry

Korea's $15 billion group catering market set for shakeup after Hanwha's Ourhome acquisition

Published: 06 Jun. 2025, 07:00 Updated: 06 Jun. 2025, 14:43

Audio report: written by reporters, read by AI

People eat at a company cafeteria in Daejeon Government Complex in Daejeon on Sept. 13, 2023. [NEWS1]

Korea’s 20-trillion-won ($15 billion) group catering market is undergoing significant shifts as Hanwha Group acquires Ourhome, one of the top players in food service and ingredient distribution. New opportunities, such as military and senior catering, are also emerging.

Group catering refers to meal services provided to a designated group at locations like dormitories, schools, hospitals, factories, offices and welfare facilities. According to the Ministry of Agriculture, Food and Rural Affairs, the group catering market was estimated to be worth about 21.2 trillion won in 2022 — 11.5 trillion won in the private sector and 9.7 trillion won in the public sector.

Five companies — Hyundai Green Food, Samsung Welstory, CJ Freshway, Ourhome and Shinsegae Food — account for over 80 percent of the market.

The spotlight is currently on Ourhome. After Hanwha Hotels & Resorts became its largest shareholder, Hanmi Semiconductor, which had clashed with Hanwha affiliate Hanwha Semitech, terminated its catering contract with Ourhome early.

Industry watchers are closely monitoring whether group catering contracts from pan-LG affiliates — LG, LS, GS and LX — that previously used Ourhome will now be up for grabs. Ourhome was founded by the late Koo Cha-kyung, third son of LG founder Koo In-hwoi, and handled significant catering contracts for LG spinoffs.

Soldiers eat their meal at an army cafeteria in Gyeonggi on Nov. 7, 2024. [NEWS1]

Military catering: Low margins, high competition

Military catering is another area of interest.

The Ministry of National Defense currently provides civilian catering at 26 bases through contracts with eight companies and plans to expand this to 49 bases — covering 15 percent of total military personnel — this year alone. Bidding is open for 23 bases.

“Contractors have been selected for two locations so far, with the rest to follow,” a ministry official said.

For a catering market grappling with stagnation due to low birthrates, this is a welcome development.

“Corporate cafeterias often have fluctuating diner counts,” said a source in the catering industry. “The appeal of military catering lies in its guaranteed volume — the number of diners is fixed at 100 percent.”

A company cafeteria [JOONGANG ILBO]

Since the ministry began outsourcing military catering in 2021, mid-sized firms Pulmuone and Dongwon Home Food have led the charge. Pulmuone started with the Korean Army Non-Commissioned Officer Academy and now serves all branches — Army, Navy, Air Force and Marine Corps. Dongwon Home Food caters to three Army units and one Air Force unit.

Large corporations are entering the field as well. Last year, Samsung Welstory secured contracts to cater for the Korea Military Academy and Korea Army Academy at Yeongcheon. Starting this month, it will also handle catering for the 30th regiment at the Korea Army Training Center.

Hyundai Green Food was selected last month to cater for two additional units: the 8th Fighter Wing of the Air Force and the 36th Infantry Division of the Army. CJ Freshway, currently focused on ingredient distribution, said it is considering expanding into military catering.

The Ministry of National Defense will review whether to expand the outsourcing program based on performance evaluations and field feedback, signaling potential market growth.

A worker serves themselves with kimchi at a company cafeteria in Daegu on Sept. 26, 2024. [NEWS1]

Still, military catering poses challenges. The daily meal cost ranges from 13,000 to 15,000 won — 4,300 to 5,000 won per meal — which is lower than the 6,000 to 7,000 won average at industrial sites. Strict procurement requirements also complicate bidding.

“Military catering often mandates a certain percentage of local ingredients or contracts with local suppliers,” an industry source said.

The next battleground: Senior catering

Catering and care food — meals tailored for older adults — are emerging as the next competitive frontier.

Samsung Welstory provides food services for care facilities such as Bundang Daycare Center and senior residences like Lhour Osiria in Busan. Pulmuone runs catering operations at facilities such as Science Village and Gwangju Veterans Hospital.

CJ Freshway and Hyundai Green Food are each pushing care food brands — Healthy Nuri and Greeting Wells respectively — that cater to people with chewing or digestion difficulties. Dongwon Home Food dispatches dietitians to three hospitals — the National Cancer Center, Bucheon Soon Chun Hyang University Hospital and Chilgok Kyungpook National University Hospital — to provide specialized patient meals.

Shinsegae Food is targeting high-end apartment complexes instead of military or senior catering. Since launching at Trimage in Seongsu-dong, Seoul, in 2018, it has expanded services to 10 luxury apartment complexes, including Gaepo Raemian Foret and Seocho One Bailey, covering over 11,000 households.

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.
BY HWANG SOO-YEON [[email protected]]