Restaurants slash soju, beer prices despite high inflation

Restaurant menus are displayed along a street in Myeong-dong, Seoul, April 1. Yonhap

A bank employee in Seoul surnamed Kim was surprised during a recent visit to a restaurant in Gaepo-dong, Gangnam District, where a bottle of soju was priced at just 3,000 won ($2.05).

She said the restaurant, which serves mainly grilled pork, offered the alcoholic beverage at the steep discount to customers who ordered meat.

“These days, with prices continuing to rise, it is common to see a bottle of soju priced at 5,000 won or 6,000 won at restaurants in Seoul. In expensive areas like Gangnam District, it’s not unusual to see prices go up to 7,000 won or even 8,000 won per bottle. So, seeing soju at 3,000 won was quite a surprise,” she said.

Although inflation remains high, the prices for soju and beer at restaurants have been on a steady decline in recent months, according to Statistics Korea.

This unusual trend in alcohol pricing is largely attributed to weakening domestic consumption. Facing a drop in the number of customers amid the economic slowdown, many restaurant owners are turning to discounted alcohol as a survival strategy.

According to the agency's consumer price data for March, the price of soju at restaurants fell by 1.3 percent from a year ago, marking the seventh consecutive month of decline since September 2024.

Beer prices at restaurants also fell 0.7 percent from a year earlier, marking four straight months of decline since December.

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Restaurants cutting alcohol prices is a new phenomenon, not seen even during the 1997 Asian financial crisis or the 2008 global financial crisis.

A year-on-year decline in restaurant soju prices has been observed only once before — in July 2005. Statistics Korea began compiling related data in January 2000.

As for beer, the recent drop in restaurant prices is the first in nearly 26 years, with the last instance happening between July and November 1999.

The decline is in contrast to the overall inflation trend.

In March, consumer prices rose 2.1 percent from the same month last year. Food prices saw steeper gains, with dining-out costs up 3 percent. Processed food prices also jumped 3.6 percent, marking the highest year-on-year increase since December 2023.

“The recent trend reflects restaurants applying their own discounts,” a Statistics Korea official said, noting that many have lowered alcohol prices to attract customers amid reduced spending on dining out.

In addition, with domestic demand remaining sluggish, low-cost bars and restaurants are seeing a surge in popularity.

One budget pub chain — which launched at the end of 2023 offering beer for 1,900 won — has already expanded to more than 180 locations.