Korean food brands gain abroad as franchise disputes cloud expansion

By Olivia Hart

MoneyToday reported that CJ CheilJedang’s overseas food business generated 592.47 billion won last year, surpassing domestic revenue for the first time. Samyang Foods’ overseas revenue share grew to 84%, while domestic restaurant companies increased their overseas stores from 3,722 in 2020 to 4,644 last year. That 922-store gain equals 24.8% over five years.

MoneyToday’s special feature, “Going to the scene of K-Initiative riding the 2026 K-Wave,” described overseas consumers testing the spice of Buldak ramen, stocking freezers with bibigo dumplings and queueing before opening for Korean-style fried chicken, gimbap and tteokbokki. The feature linked Hallyu-fueled curiosity to repeat purchases and called that conversion a “virtuous cycle.”

Where is the next growth opportunity?

The feature did not disclose country-level sales, same-store performance or franchise profitability, so its data confirms expansion rather than durable margins. MoneyToday nevertheless located the next opportunity in franchising that transfers Korean menus, service, interior design and delivery systems as a package.

That strategy depends on timing, according to the report. While local consumers show high interest and actively seek Korean brands, MoneyToday argued that first movers can establish a presence before rival brands make the segment routine. It warned that a late rush would raise entry costs and fade distinctiveness.

The proposal relies more on a market-timing thesis than disclosed economics. MoneyToday cited no franchisee returns, entry-cost schedule or store-level sales data, which leaves its claim that early movers can sustain an advantage unverified.

What changes under the franchise law?

The Franchise Business Act takes effect next year, according to MoneyToday, and the report called compliance the most urgent task for franchise headquarters. A store-owner group registered with the Fair Trade Commission can request consultation when it represents more than 10% of franchisees and has at least 30 members.

The franchisor must respond, and an extreme case could involve requests from as many as 10 owner groups. Failure to respond can trigger a corrective order, giving regulators a direct enforcement lever as overseas expansion gathers pace.

MoneyToday said the law seeks to protect owners and strengthen their bargaining power. It also warned that weaker brands and unprofitable stores would leave franchisees more exposed, rather than making headquarters’ obligations a guaranteed benefit.

What does the Pizza Hut ruling require?

The Supreme Court has finalized Korea Pizza Hut’s loss in a lawsuit brought by 94 store owners seeking the return of differential franchise fees. The company must return 21.5 billion won in fees that the contracts did not specifically agree upon.

MoneyToday said the ruling has prompted similar lawsuits across the industry. The report argued that lawyers’ reduced income, caused by delays in judicial administration, fuels a “struggle of the weak” between small franchisors and franchisees, while the disputes add social costs without proving a better operating model.

Without identifying those cases, MoneyToday said franchising grows through mutual benefit rather than confrontation. It called shared benefits a prerequisite for sustainability and warned that a dispute-driven system can erode growth opportunities.

Can brands expand while resolving disputes?

MoneyToday said franchise headquarters consumed by disputes with owners are setting aside collective overseas growth. It called early entry a competitive advantage and said management risks wasting time on liabilities from past contracts while ignoring the global market.

The report warned that Chinese counterfeit brands, already using Korean-food branding, have begun filling the space as if they were Korean companies. It offered no brand names, sales figures or launch dates for those businesses, so the scale of substitution remains unmeasured.

Calling the opening a once-in-a-lifetime opportunity, MoneyToday warned that the door to K-food would not remain open forever. Missed timing, it said, would leave world markets to competitors from other countries, while its premise is that Hallyu has already made K-food globally visible.

How would a package-entry strategy work?

MoneyToday rejected the idea that government encouragement alone can globalize K-food. It highlighted a package-entry strategy from the Korea Franchise Industry Association: Olive Young, described as an overseas K-beauty leader, establishes a location on a specific street, then multiple K-franchises enter around it.

The report’s examples mapped Hongdae onto Los Angeles, Myeong-dong onto London and Seongsu-dong onto Ho Chi Minh City. The proposal treats the cluster as a launchpad for food franchises, although the source supplied no conversion, rent or occupancy assumptions.

MoneyToday urged the government to remove obstacles to global expansion rather than add regulatory hurdles. Its final measure of success was whether K-food could stand on the path laid by Hallyu.

The near-term test comes next year, when the Franchise Business Act takes effect and companies must show whether consultations can settle disputes without generating more litigation. Unless franchise economics and overseas store returns arrive as evidence, the report remains a case for speed rather than proof that Korean brands can convert global interest into durable, profitable growth.