"Business has been really slow lately."
This common refrain from merchants echoes through traditional markets and shopping districts. Whether at popular eateries or quiet shops, owners express similar frustrations. While the economic downturn plays a role, the primary issue lies elsewhere: the relentless expansion of large platforms and retail giants.
Despite constant delivery notifications during lunch hours, after deducting delivery fees, promotional costs, and other expenses, little remains for the merchants. Even when sales appear to rise, many are struggling with a deceptive form of deficit that offers no real profit.
Delivery Hero, a leading delivery platform, has recently faced backlash from restaurant owners over its revised fee structure and the shifting of delivery costs. However, a viable solution for mutual benefit has yet to emerge. Delivery Hero has been a frequent presence at National Assembly hearings this year, but its representatives have disappointed many with their responses. During a recent session, executives faced criticism from lawmakers regarding fee increases and unfair trading practices, yet they offered evasive answers rather than showing empathy for the struggles of small business owners. Kim Beom-seok, the CEO of Delivery Hero, ultimately did not appear at the hearing, leaving many feeling betrayed by those they hoped would support them.
The situation on the streets reflects this struggle. Daiso, which has rapidly grown into a national discount store with its uniform pricing of 5,000 won, is quickly taking over local markets, forcing long-standing stationery shops, general stores, and hardware stores to close their doors. While consumers enjoy low prices and convenience, the survival of small businesses that have supported local economies is quietly being dismantled. The unchecked encroachment of large discount stores into local markets is further squeezing the already vulnerable positions of small business owners.
Daiso's expansion is not limited to physical stores. The company is diversifying its purchasing channels by integrating its online mall, offering same-day delivery, next-day shipping services, and linking with quick commerce platforms. This strategy threatens both local shops and stationery stores, as they now face competition from both online and offline sources.
A significant concern is that whenever conflicts arise, the responses from the government, local authorities, and corporations often fall into the convenient framework of 'voluntary coexistence.' In a market where information and negotiating power are heavily imbalanced, relying solely on the goodwill or voluntary concessions of large corporations is merely a temporary fix. Such voluntary agreements lack legal enforcement and are ineffective for small business owners who lack the resources to implement them.
Criticism of the technological and commercial growth of large platforms and retail chains is not the goal. The expansion of businesses can be a natural part of a capitalist market. However, if the ecosystem of local markets collapses under this growth, leading to the downfall of small business owners, it will ultimately result in increased household debt and a stagnating local economy, which will circle back to affect the retail companies and the market as a whole. Therefore, small businesses should be recognized not merely as entities to protect but as business partners that sustain the retail ecosystem.
It is time to move beyond one-time subsidies or superficial agreements and pursue substantial institutional reforms. There is a need for regular disclosure obligations regarding delivery platform fee structures, improvements to opaque fee systems, and enhanced evaluations of the impact on local markets when large retail chains enter.
To achieve sustainable 'true coexistence' between large corporations and local markets, the government and the National Assembly must craft more sophisticated and bold legal and institutional frameworks. Ignoring the sighs of local market owners will not lead to lasting growth.
* This article has been translated by AI.
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