Franchise businesses in Korea remain exceptionally too many and their life exceptionally short, according to government data.

According to the Fair Trade Commission (FTC) on Thursday, there were 243,454 franchise stores under 6,052 brands in the country last year, the largest figures in history. The number of franchise headquarters reached 4,882, much higher than other countries with bigger economy including the U.S. with around 3,000 headquarters and Japan with 1,339.

However, the growth pace in the number of franchise headquarters rapidly slowed down from 17.1 percent in 2014 to 5.4 percent in 2018, and franchise brands from 16.2 percent to 5.4 percent. The number of franchise stores also increased at a slower pace year on year from 7.2 percent gain to 5.4 percent over the same period.

By sector, restaurants took up the largest share of 48.1 percent in the nation’s franchise stores, followed by wholesale or retail stores such as convenience stores at 29.3 percent and service sector at 22.6 percent.

But restaurants were the shortest survivors among franchise stores, with business life averaging four years and seven months. Service businesses lasted an average of 6 years and 1 month and wholesale and retail sector 6 years and 5 months.

The FTC said the short life span of the nation’s restaurants is due to fierce competition. There were 24,602 chicken restaurants in the country in 2018, followed by Korean food stores with 18,934, others 15,736, coffee 13,931 and snack and street food 8,495.

By Choi Hee-suk and Choi Mira

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]