Korean food service industry is showing the trend of rapid growth in short period of time together with economic growth. As food service industry is regarded that it reflects a nation's economic, culture, level of income and standard of living, it is sensitive industry that could be influenced by such factors including social, economy, culture, technology, environment, purchasing trend and so forth. Among the various factors, increased income level gives most direct impact on development of food service industry and this factor was the background for the rapid growth of Korean food service industries. Nevertheless of the rapid growth in quantity, structure and the business environment of Korean food service industry tend to fall behind compare to advanced nation such as the US and Japan.
Especially, absence of the structural issues such as legal issues and policies that are needed in order to foster the food service industries is occurring. If this may continues, the problem that revealed from opening its market to foreign enterprise, for instance, overpaid loyalty, encroachment of food culture and aggravation of international competitiveness will be accelerated.
Among these problems, the franchising is one of the major issues that Korean food service industry is currently facing and this is suggested that this issue is needed to be resolved in order to achieve adequate industrialisation of food service industry.
Franchising introduced in Korea in 1980s along with opening of food service market to foreign enterprises. Approaching the 1990s, franchising is extended in its range of business types and in number of outlets and in its business forms. Since current trend of globalisation which leads Korea to accelerate in opening it market, the franchise businesses are expected to have continual growth. However, the concept of franchising is not properly established in Korea, thus indiscreet adoption of vast franchise business forms is taking place.