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Revenue gap between franchise headquarters, outlets further widens

Published: 10 Oct. 2025, 18:22

JIN MIN-JI
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A Papa John's pizza chain outlet in Seoul on June 27, 2025. [Yonhap]

Korea's franchise headquarters saw their revenue rise while earnings at franchise outlets declined over the past two years, deepening the imbalance between franchisors and franchisees, industry data showed Friday.

According to data from corporate tracker Leaders Index, sales trends across seven key sectors — coffee and beverages, fried chicken, pizza, convenience stores, bakery, dining, and cosmetics — showed widening disparities between headquarters and franchisees.

The total number of franchise outlets in the seven sectors came to 92,885 last year, up 6.6 percent from 87,108 in 2022.

During the cited period, franchise headquarters' revenue jumped 10.8 percent to 47.79 trillion won ($33.6 billion), while average franchise store sales fell 7.6 percent to 302 million won.

The gap was most pronounced in the pizza sector, where headquarters' combined sales surged 66.5 percent to 1.12 trillion won, while franchisees' average sales dropped 11.9 percent to 311.6 million won.

In the dining sector, sales at 54 franchise headquarters increased 29.7 percent over the two-year period, but average franchise store revenue fell 16.4 percent.

In the bakery sector, headquarters' revenue rose 5 percent, while that of their franchisees fell 18.7 percent.

The coffee and beverage sector was the only segment to post simultaneous growth at both the headquarters and outlet levels since the Covid-19 pandemic.

The number of outlets run by 17 coffee and beverage brands increased 19.2 percent over the two-year period to 11,513, the fastest growth among all sectors.

Headquarters' revenue climbed 33.4 percent to 3.94 trillion won, while average franchise store sales rose 14.1 percent to 252 million won.

The convenience store sector remained the largest by outlet count, with 55,331 stores nationwide as of 2024.

"In sectors such as dining, chicken, pizza and convenience stores, the number of outlets continues to rise but per-store sales are declining, reflecting a classic case of market saturation," Leaders Index said.

Yonhap