The Purpose of this paper is to describe the distribution of franchise chains in Seoul and to investigate the impact of franchise chains in retailing on the commercial space in Seoul. Franchise chains in this paper are defined as chain stores, accordi...
The Purpose of this paper is to describe the distribution of franchise chains in Seoul and to investigate the impact of franchise chains in retailing on the commercial space in Seoul. Franchise chains in this paper are defined as chain stores, according to their appearances, which use the same trade name and the same brand, and which deal in identical goods and services. Franchise chains are divided into two types, based on the management of store's headquarter, the two types of stores are ① stores under direct management of headquarter and under single ownership, and ② member stores under indirect management of headquarter and under contract. The results of considering the distribution of franchise-chains are as follows:
1) Franchise chains have been the fastest growing and most interesting development in recent years. In 1990, the number of headquarters in the type of businesses selling fried chickens is 36, in the type of noodel shops is 17, in the type of confectioner's shops is 20, and in the type of stationeries is 18. Most of the business offices, which controlled each chain, are clustered in the centre of city (Chung-gu, Chongno-gu), in Gangnam-gu, and Socho-gu.
2) In 1990, frnchise chains are concentrated in dongs in Chung-gu and Chongno-gu, which are located in the centre of the city, and clustered in dongs in Gangnam-gu and Socho-gu, which are located in the southeastern part of the city. These areas are similar to those areas where the retail-trade establishments and the drink-restaurant establishments were clustered in 1986. The distribution characteristics of franchise chains in 1990 are also similar to those of establishments at wholesaling, retailing, and drink-restaurants in 1986. Therefore, it is shown that franchise chains as the new forms of the retail institution are entering the existing commercial areas first, and then diffuse into other areas.
3) First, a case study conducted to examine the comparison between the stores under direct management of headquarter and under single ownership, and the member stores under indirect management of headquarter and under contract shows that the former is concentrated in Chunggu and Chongno-gu, located in the centre of the city.
Secondly, a case study conducted to investigate the franchise-chain diffusion at each three stages, divided according to the increase of the number of stores, shows as followers: at the beginning stage franchise chains are located in the high cost city centre and at the next stage subsequently decentralized to less expensive suburban locations. Generally speaking, the type of diffusion is mixed with the hierachical diffusion and the expansion diffusion. It is suggested that this is related to the strateges and to the product life cycles.
In the future, as franchise chains increase and new forms of retailing emerge, the urban space will change into a more complicated commercial space. Therefore, further studies must adopt a wore dynamic perspective and must be carried out on the microscopic reginal analysis and on the theories of retail institutional change.