Soaring restaurant prices are reshaping how consumers choose their lunch and dinner. Demand is flocking to home meal replacements (HMR), which cost little more than buying groceries and cooking at home. Even when dining out, more consumers are turning to low-cost franchises or mid-priced buffets. Meanwhile, sales at conventional restaurants are declining, suggesting that the burden of dining-out prices is fueling polarization in consumption.
According to Emart on Tuesday, sales of ready meals at its stores nationwide rose 10% in the period from the start of the year through the 18th. Room-temperature soups and stews posted sales growth of 31.8%, while frozen soups and stews grew 20.8%. Other ready meals such as curry rose 19.8%, while sales of frozen meal kits climbed 18%.
Dish-style ready meals saw even larger gains. Frozen noodle products such as spaghetti and frozen rice dishes such as shrimp fried rice jumped 40.6% and 45% in sales, respectively. "Room-temperature products with long shelf lives and frozen ready meals grew significantly," an Emart official said. "With dining-out prices rising and demand for meals at home growing, smaller families often find little difference between the cost of buying ingredients and cooking themselves versus buying ready meals, which appears to be driving demand."
The popularity of ready meals is appearing across retail channels. At Emart Everyday, a supermarket chain (SSM), sales volume of room-temperature soups and porridge surged 176% year-on-year in the period through the 18th. Room-temperature soups and stews (40%) and frozen fried rice (21%) also posted strong gains.
Demand for ready meals at convenience stores is rising sharply as well. According to CU, gimbap sales surged 26.9% year-on-year from January through last month. Over the same period, HMR sales rose 17.2%, triangle gimbap 15.0%, processed meat products 10.4% and lunchboxes 10.1%. To meet growing demand for ready meals, CU is also pursuing a renewal of its entire ready meal lineup this year. The company is rolling out renewed ready meal products including lunchboxes, gimbap and triangle gimbap, centered on "PBICK The Kitchen," an extension of its master private brand "PBICK" into ready meals, and the value-focused "Deuktem" series.
GS25 also posted lunchbox sales growth of 20.4% year-on-year in the period through May, while gimbap rose 24.4%. Fresh Subok, a subsidiary of GS Retail, expanded the production lines at its Osan plant to respond to the rising demand. The Osan plant is a key facility producing GS25's private-brand lunchboxes, triangle gimbap, sandwiches and other ready meals. The expansion nearly doubled production of triangle gimbap and sandwiches. "Demand and interest in fresh food (FF) categories such as ready meals are growing due to lunchflation and the rise in single-person households," a GS Retail official said. "Securing stable production capacity is essential."
The restaurant industry is also seeing market changes driven by lunchflation. Demand for cheap lunches is moving beyond convenience stores to fast-food outlets. McDonald's Korea recorded revenue of 1.431 trillion won and operating profit of 73.2 billion won last year, up 14.5% and 523%, respectively, from a year earlier. Lotte GRS, which operates Lotteria, posted revenue of 1.1189 trillion won and operating profit of 51.1 billion won, up 12.4% and 30.6%, respectively. It was the first time in eight years, since 2017, that Lotte GRS surpassed 1 trillion won in revenue. Burger King and Mom's Touch also posted strong results.
The mid-priced buffet segment is also on the rise. With a single bowl of naengmyeon costing more than 10,000 won and samgyetang reaching 20,000 won, mid-priced buffets, where one can eat for 10,000 to 50,000 won per person on weekdays, are drawing attention as value-for-money meals. According to E-Land Eats, the number of Ashley Queens stores more than doubled in four years, from 59 in 2022 to 122 last month.
The growth of burger franchises and buffets contrasts with the overall trend in the restaurant industry. According to the Ministry of Agriculture, Food and Rural Affairs and the Korea Agro-Fisheries and Food Trade Corporation, the restaurant industry sales index stood at 73.84 last year, down 1.77 points from a year earlier. An index below 100 means more businesses saw their sales decline.
Amid these trends, omakase closures have surged. According to the Ministry of the Interior and Safety, 2,593 Japanese restaurants, including establishments selling Japanese omakase, closed over the roughly three-year period from 2023 through May this year. That figure exceeds the number of Chinese restaurants (1,821) or cafes (624) that closed over the same period.
The industry expects the current trend to continue for some time as long as the burden of dining-out costs persists due to high inflation. According to the May consumer price trends from the Korea Data Agency, last month's consumer price index stood at 119.92 (2020=100), up 3.1% from a year earlier. That was the highest increase since March 2024 (3.1%), when agricultural prices rose sharply.
