SEOUL, South Korea – Coffee consumption in South Korea declined for the 3rd straight time on year in the second quarter of 2013, according to figures released Monday. This is mainly due to prolonged global economic slowdown denting their spending activities, reports The Korea Times.
The average spending of local households on coffee and tea came to 7,873 won (US$7.41) in the April-June period, falling 1.8 percent from 8,017 won tallied last year, the Korean Statistical Information Service data showed.
It marked the second quarterly drop in 2013. While the figure edged down 1.3 percent on-year in the fourth quarter of 2007, it had maintained a quarterly on-year gain hovering around 10.5 percent between 2008-2012.
Market watchers said the recent decline came as South Koreans tightened their belts amid global economic uncertainties, and rising competition in the market also added to the limited expansion of the industry.
“As major franchise coffee shops are also suffering a decline in their earnings, the falling household spending on the beverage may not be a temporal phenomenon,” a local analyst said.
“While opening coffee shops was considered to be high-profit and low-cost business opportunities for the post-retirement period, (South Koreans) should now be more careful before considering opening one,” the analyst added.
South Korean households’ spending on alcoholic beverages, meanwhile, expanded 8.7 percent to 10,163 won over the cited period, while expenditure on tobacco products shed 6.4 percent to 17,424 won, the data also showed.
Source: The Korea Times