Seoul, May 26: The number of coffee shops, eateries and convenience stores in South Korea is on the wane amid a prolonged economic slowdown and sluggish domestic demand, data showed on Sunday.

According to data compiled by the National Tax Service (NTS), 95,337 cafes were in service in the first quarter, down 743 stores from the same period last year, reports Yonhap news agency.

It marks the first time the number of coffee shops has declined since record-keeping began in 2018.

That year, there were 45,203 cafes before the figure jumped to 53,102 in 2019, 62,916 in 2020, 72,847 in 2021, 85,609 in 2022 and 93,913 in 2023.

The number of coffee shops peaked at 96,080 last year before falling this year.

The downward trend also applied to restaurant businesses in general, with the number of fast food chains coming to 47,803 in the first quarter, down 180 shops from a year earlier.

Korean food eateries and Chinese restaurants saw their numbers shrink by 484 and 268, respectively.

The number of convenience stores also slipped 455 on-year to 53,101 shops as of end-March.

Industry officials say a large number of retirees who have jumped into various self-employed businesses are closing down their shops due to market saturation and slowing domestic demand. Some also point to large commission fees for delivery platforms as factors burdening business owners.

The average sales of small business owners in the first quarter were approximately 41.79 million won (US$30,558), down 0.72 percent from a year earlier, according to the Korea Credit Data (KCD).

Meanwhile, the Bank of Korea (BOK) is likely to revise down its gross domestic product (GDP) growth forecast from the current 1.5 percent to around 1 percent or lower at its upcoming rate-setting meeting Thursday, according to a recent Yonhap News Agency survey of seven economists.

(IANS)

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