Start-up franchise store owners invest W182 million on average and earn roughly W4.25 million every month (US$1=W1,138). It usually takes 5.1 months to prepare to launch their business, and they review 3.5 franchise brands before reaching a final decision.
These were the results of the Korea Chamber of Commerce and Industry's survey on 350 franchise stores in the Seoul metropolitan area and six other major cities.
Each store was found to earn W240 million in annual revenue on average and net income of W51 million, excluding from revenue operating expenses such as materials and labor costs. Raw materials were the primary expense, accounting for 41.3 percent of all operating expenses, followed by rental fees (17.8 percent), labor costs (15.8 percent), and maintenance bills (12.1 percent).
Asked what made their franchise start-ups successful, the largest percentage, or 35.4 percent, of respondents cited location. Next came "business type" (33.4 percent), "experience and know-how" (12.3 percent), "franchise brand" (7.4 percent), and "customer service" (4.3 percent).