IndexIntroductionEconomic FactorsLegal FactorsEnvironmental FactorsOther FactorsConclusionReferencesIntroductionEver since the concept of globalization took the business world by storm, the food industry has been one of the most sought-after areas for expansion beyond confine. No matter how tempting the idea of ​​global expansion may seem, it is not possible to simply dive into the deep waters of international expansion. Analyzing and predicting cultural, national, environmental, legal and socioeconomic factors is one of the first steps towards expansion. After taking a closer look at these factors, South Korea presents itself as a promising target for extracting our share of profits from this multi-billion dollar industry. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an Original EssayEconomic FactorsSouth Korea's economy is ranked 11th in the world and 4th in Asia. South Korea's economy recorded its weakest growth rate since 2009 due to sharp contraction in the manufacturing and construction sectors (Trading Economics, 2019). However, the bright side of the picture shows growth of 3.1% year-on-year in the final quarter of 2018, up from 2.0% growth in the previous quarter. Since 2017, it has been the fastest growing rate, mainly driven by the service, agriculture, fishing and forestry sectors (Trading Economics, 2019). In fiscal 2019, government spending provided a cushion to South Korea's GDP after a 0.4% reduction in the last quarter through June (Kim. S, 2019). Consumer spending has increased significantly in South Korea over the years. In the second quarter of 2019, it touched the highest amount of KRW 221,901.20 billion compared to KRW 220,417.20 billion recorded in the previous quarter. Taking into account all these economic trends, South Koreans are leaning towards low-priced dining options. The fast food industry has seen a surge in demand due to its competitive prices, fixed menus and continuous promotional offers throughout the year. South Koreans, keeping in mind their work commitments and the convenience associated with ordering fast food via home delivery/online, prefer to spend money on this food service segment. Legal Factors You need to take into account a number of rules and regulations before expanding business fly into this territory. The Korean Corporate Partnership Commission (KCCP) limits the expansion plans of multinational companies to specific geographic areas and a certain number of subsidiaries. KCCP plays an important role in the growth of local small and medium-sized businesses, therefore imposes regulations on international subsidiaries (Korea Franchising, 2019). You must obtain an authorization letter from the Korea Trade Investment Promotion Agency (KOTRA) before making an investment. You then obtain a registration letter from the Tax Office. Audited annual financial statements must be submitted to local tax authorities along with tax returns. In August 2003, the South Korean government created a free trade zone to attract foreign investment to the region. Various tax support incentives are also available to foreign investors along with convenient means of transferring money to the parent company (Hayes. S, 2017). South Korea's legal structure, with its pros and cons, welcomes foreign investment into the country by offering simpler incorporation procedures. Environmental factors It could create aripple effect in fast food industry revenue stream due to South Korea's environmental factors. Seoul has launched alarming measures to control the deteriorating air and water pollution conditions in the region (McCurry. J, 2019). With these circumstances in mind, our fast food chain must promote corporate social responsibility (CSR) actions to attract the target market. Many South Korean companies have taken steps to initiate welfare programs for South Korean children and youth. In 2013, “The Happy Burger” campaign was launched by Mc Donald's Korea to provide 800 meals to child care institutions in several cities. CSR will help build a strong emotional bond between the consumer and the brand. Furthermore, the company should efficiently use energy resources to minimize environmental damage. Reusable packaging should be used along with easy recycling options. Efficient means of water consumption must be adopted to minimize water and land pollution. Other factors There is a recent trend in the South Korean population towards Western food products. Just recently, a tariff on the import of processed foods was increased, providing new opportunities for the fast food industry to consolidate its position in the region. South Korea, whose population is estimated to be over 50 million so far in 2019 (the Office of Statistics 2019), is experiencing rapid food service market growth, as the nation's socioeconomic changes continue to impact food spending meals away from home. Overall revenue in the food service industry in South Korea grew at a CAGR (compound annual growth rate) of 3.5% between 2014 and 2016, and is expected to increase at a CAGR of 3.6%. until 2021, according to data published in 2017 by Global Data. This has encouraged numerous international food chains to establish themselves in the market. These include large international fast food chains, such as Mc Donalds, Pizza Hut, but also some medium-sized foreign restaurants, such as Shake Shake Burger, which is introduced from the United States and soon reaches the South Korean food market with the Its average number of customers was reported to be 3,000 per day for the first month of its opening. Along with the successful expansion of international restaurant chains in South Korea, people living in the nation are also showing the tendency to dine out at an increasing rate. According to the Monthly Household Expenditure Survey organized and practiced by the Korean National Statistics Service in 2017, per capita household monthly expenditure on eating out in Korea has continued to grow solidly for several consecutive years, reaching approximately US$123 million in 2017. Korean households spent 47.6% of food and beverage expenditures (or 13.3% of total consumption expenditures) on dining out. Considering all factors, it can be assumed that Korean consumers eagerly spend on dining out, seeking international tastes, and if it is an economical and convenient choice to follow, it can definitely increase their tendency to dine out. Yang-What et al. (2001) found that Koreans' eating behavior shifts toward more Westernized and convenient foods and that Koreans become increasingly dependent on eating out. The 2001 Korean National Health and Nutrition Survey (KNHNS 2001) also shows that the number of people eating out more than once a day increased from 20.5% in 1998 to 33.2% in 2001. Together to the cultural trend shown among Korean citizens – eating out more often has occurred recentlychange in culinary culture that is worth examining. Very few people dine alone in South Korea, as it is common for all family members to dine together at home and children also dine with their classmates at school. However, as society is becoming more competitive and there is a growth in individualism, it encourages more and more people to embrace a rather new idea of ​​dining alone. Therefore, if people are given decent options to choose from, whether with their friends, family, or without anyone else, they would be happy to try new foods, especially those that can be prepared quickly in places, such as food courts, as well as those based on familiar ingredients such as rice, as commonly found in Mexican or Thai cuisine. South Korea and the United States implemented the Korea-US Free Trade Agreement in 2012, the agreement (FTA) led South Korea to activate more agreements with other major countries, including South American countries – Chile, Colombia, Peru etc. – as well as Asian countries such as Singapore, India, etc., with other countries – Australia, Canada, New Zealand, EU and so on. As a result, a number of companies based in those nations have successfully launched into the South Korean market, including international food chains, with reduced tax rates when operating Korean subsidiaries, as well as reduced tariffs for imported raw materials from these countries. Meanwhile, according to the US International Trade Commission's 2007 survey, labor productivity in South Korea's service sector is just 56% of that in the manufacturing sector, well below the OECD average of 93%, which can reduce the burden of paying labor costs in establishing and operating internationally. food court themed restaurants in South Korea. Conclusion Considering all aspects, the restaurant market in South Korea seems to have great growth potential. South Korean citizens appear to have few emotional barriers to trying international food, as long as it is an economical choice and is cooked quickly. Furthermore, people have become familiar with a new concept of dining out 'alone', which is why it seems reasonable to establish internationally themed food courts, such as Mexican or Thai, whose cuisine involves rice-based dishes with hot spices, similar to the Korean one. Furthermore, the tax rate is reduced for international companies whose main subsidiaries are located in countries with FTA – therefore, it seems appropriate to establish the restaurant as a wholly owned subsidiary, with all the skills related to the management of its structure, manpower, products and customers. Since the parent company can still take full control over those newly opened in South Korea, it can provide meaningful advice on the new business operation. Please note: this is just an example. Get a custom paper from our expert writers now. Get a Custom Essay In conclusion, taking all factors seriously considered, it should be profitable to open a new food chain – Mexican or Thai themed – in South Korea, but not as a large restaurant, but in part of food courts.ReferencesCompanyformationkorea, 2018 , "Open a branch in Korea", viewed October 12, 2019Hayes. S, 2019, "The Korean Law Blog", viewed October 13, 2019 < https://www.thekoreanlawblog.com/korean-tax-law>Kim. S, 2019, “South Korea Price Drop Illuminates Global Growth,” viewed October 13, 2019 < https://www.bloomberg.com/news/articles/2019-09-30/south-korea-s -prices-fall-for-the-first-time-export-suffering-persists>Kim. Yes, Kang. Y and Lim. M, 2017, "Effects of>