Merchants, small businesses sharing space to ride out rent hike

By Koh Byung-joon SEOUL, March 18 (Yonhap) -- An inconspicuous cafe near Gyeongbok Palace in central Seoul might be a typical place where customers would enjoy coffee or small talk with their friends over a cup of tea after lunch in the neighborhood. What draws the eye, however, is that it changes into a different shop at night where the coffee is gone and beer takes its place. Customers expect gourmet draft beer and some snacks over which they try to let off their daily stress. "Our shop opens as a cafe everyday selling coffee and other tea but it turns into a beer shop from 6 p.m.," said a retired accountant, who runs the coffee business. "The other owner comes in to run the beer side of it at night. We are sharing this place for two different businesses." The shop was launched about one and a half years ago as the two came up with the "sharing" idea. Tapping into their own expertise both in coffee and beer, they decided to take turns running different shops in the hopes it could ease the burden of the relatively high monthly rent fees. "Who could stand the rising rent?" said his wife who is in charge of cookies and cakes that go with the coffee. "Shop sharing was a choice to lower costs, and it surely helps us much in running our coffee business." This is part of the steadily growing sharing trend -- mostly among small self-employed businesses -- as they are trying to look outside the box in experimenting with diverse unconventional ideas intended to get over persistently tough business conditions. The sharing trend appears to be feeding on the deep-rooted worries that a business could be forced to pack up and leave due to skyrocketing rental fees ironically that take place after the successful business boost to the overall property market, experts said. Unlike the economic slowdown that individuals cannot do anything about, these businesses are becoming more active in trying to lower the costs and this is where sharing comes in as a practical way to hedge against in case their business does not pan out as planned. And sharing comes in various forms and in a manner that creates synergy. A convenience store that opened about four years ago in the middle of a residential area in western Seoul might be one of many around-the-clock stores spotted nationwide but a step inside shows that it goes beyond just easy-to-cook food and affordable daily necessities. Since the start, it has served as a local dry cleaning shop where customers can leave and pick up their clothes anytime they want, taking advantage of the 24-7 nature of the convenience store. This has proved to be a win-win, at least so far. A clerk said that sales have increased thanks to the "shop in shop" concept, while a customer in his 40s without identifying himself said that it is convenient and economic in that the prices are cheaper than other nearby dry cleaning services and that he can leave or pick up his clothes anytime. Demand for sharing has been growing so fast that even an online app that matches individual merchants seeking to open different businesses in a single store has now emerged. On the official website of "Myshoponshop," people post detailed information such as the time of the day and for how much can their stores be shared with other would-be merchants. Many posted shops are located in central and southern Seoul where there is a relatively high volume of foot traffic that usually leads to a hike in rent fees. "As the economic conditions remain tough, the number of people asking how to share shop space with existing businesses has increased significantly," Jung Byeong-chul, a co-head of Myshoponshop, said. "We are really busy these days dealing with inbound inquiries for shop sharing." Jung, who opened the online startup more than two years ago along with a business partner, said that demand for sharing "has more than doubled over the past year" and most of his customers are seeking to tide over a fall in customers and still high rent fees through shop sharing. He added that the company currently holds about 600 stores hoping for sharing. Firms with deeper pockets are quick to cash in on a potential business opportunity in sharing. Toz, a major cafe-type study room provider in Korea, recently started to provide customers with well-furnished offices where they can share key business-linked devices without worrying about long-term rent or money to pay for furniture or equipment. Media reports also showed that global office sharing company WeWork is eyeing to enter the South Korean market. It was reported to have signed a long-term lease contract for a high-rise building in central Seoul to lease it later to business people wanting to cut costs through office sharing. WeWork, which has more than 30,000 members, self-employed and corporate entities, who are using its office sharing service, plans to open its branches in some of the populous areas in Seoul, according to market sources. Experts said that such shop or office sharing in South Korea will likely grow further, saying that the economy conditions are likely to remain tough and business owners will always be on the lookout for cheaper costs. "Demand for workplace sharing is on the rise in line with the increase in the number of one-man business and small enterprises," a market watcher said. "As global office sharing companies are mulling entry into Korea, related markets could get bigger in the years to come." kokobj@yna.co.kr (END)