By Kim Rahn
Small-scale mom-and-pop business operators in Seoul will receive financial support and education on business management as part of measures by Seoul Metropolitan Government (SMG) to help small-business operators.
Seoul Mayor Oh Se-hoon announced the package of steps to back individual-run shops and restaurants, which are suffering from financial difficulty amid the expansion of large-scale businesses such as conglomerate-run super supermarkets (SSMs) and discount chains.
“Among 720,000 businesses in Seoul, 81.5 percent, or 590,000, are small-sized mom-and-pop shops run independently. Their business environment is getting worse, following the expansion of SSMs and franchise shops. Their slump directly led to Seoul’s economic slump,” Oh said.
The city will set up eight centers for retailers in April in addition to the existing seven. The centers will provide education about starting a business to 6,000 people; management improvement to 3,000; and changing types of industry to 1,000 per year.
“The education is aimed to help people start, run and improve their business more systematically, as 220,000 people started a new business while 180,000 closed theirs down in 2008 alone,” the mayor said.
Those taking the programs will be able to borrow a total of 80 billion won ($72 million) for a business start up and 10 billion won for business improvement from the city at low interest.
Considering individual business runners have difficulty in advertising and branding their products, the city government will help them develop joint brands and ads.
A group of 30 people will also give small business operators consultation on management, while another 10 interior design experts will give advice on shop interiors.
By revising an ordinance, the city will make each ward office designate traditional business protection areas and ban SSMs or other forms of conglomerate-run enterprises within a 500-meter radius of the areas from selling specific products. Such products, usually sold by small shops, include fried chicken, pizza and bread.
Operators of mom-and-pop stores within 1 kilometer of an SSM will also get help from consultants about trade strategy, product layout and customer service.
SMG will also build wholesale logistics centers small- and medium-sized supermarkets can use at three places in the capital by 2012. Those supermarkets can also borrow a total of 20 billion won at low interest for upgrading their facilities.
“We hope the measures will protect mom-and-pop store owners and increase their competitiveness,” Oh said.