Fried chicken price war erupts, and some eateries crying foul

The fried chicken wars are back as supermarkets sell buckets of birds at market-busting prices.

Customers line up at a Homeplus branch in Hapjeong, western Seoul, to buy the discount mart’s fried chicken on Wednesday. [LEE TAE-HEE]

The fried chicken wars are back as supermarkets sell buckets of birds at market-busting prices.

Not everyone is happy, with the chicken establishment hurling accusations of dumping.

Homeplus has been selling buckets of chicken for 6,990 won ($5.40) each since the last day of June. The cap is 40 buckets per location per day.

On Wednesday, over 40 people formed a line at a Homeplus branch in Hapjeong, western Seoul, to get their chance for extraordinarily cheap eats.

"Around 6,000 won for fried chicken is really a bargain, and I really wanted to buy one because eating out has really become expensive these days," said Kim Jung-yeon, a women in her 40s, waiting in line on Wednesday. "I did come early to get in line, but I would rather spend extra time than spend three to four times the money for a similar bucket of chicken."

Homeplus has moved 320,000 buckets as of Wednesday in the promotion.

The normal price for fried chicken at a supermarket is about 12,000 won.

Fried chicken franchises, such as BBQ and Kyochon Chicken, sell a box equal to a single chicken for about 20,000 won. Customers also have to pay an additional 4,000 to 5,000 won in delivery fees to get the chicken delivered to their doorsteps, which is the norm in Korea.

Homeplus aims to cut prices even more, offering a bucket for 5,990 won on malbok, or the first day of the final 10 days of summer, which falls on Aug. 15 this year.

Models show Homeplus fried chicken, sold for 6,990 won. [HOMEPLUS]

Fried chicken shops are crying foul. They claim that Homeplus is selling chicken under cost, a claim that Homeplus refutes.

"Now, people think its possible to sell fried chicken cheap like Homeplus, and posts online are accusing fried chicken franchises of enjoying higher profits and overcharging for chicken just because ours seems more expensive," said a 54-year-old man who owns a fried chicken shop in Yongsan District, central Seoul. "Its frustrating because we have to pay rent, commissions to delivery workers and franchise fees, while big discount marts don't have to pay any of that, so of course they're at an advantage and able to sell chicken at a cheaper price than us."

Homeplus says it isn't using the cheap chicken as bait to lure customers, but is able to generate profits despite the cheap price. According to the company, it cuts costs by buying chicken and other ingredients, such as chicken seasoning and frying oil, in bulk.

A similar fight occurred between discount marts and fried chicken franchises in 2010 when Lotte Mart sold buckets of fried chicken for 5,000 won. The promotion ended in a week following protests and government intervention on the grounds that the low prices hurt small businesses.

Homeplus remains confident.

An employee displays fried chicken at Lotte Mart. The discount mart will sell a bucket of fried chicken for 8,800 won between Thursday and Aug. 17. [YONHAP]

"We're aiming to offer more cheap meat products so customers can enjoy a hearty meal amid rising prices," said Han Sang-in, a spokesperson for Homeplus. "As a discount mart, we have the responsibility to offer food products at an affordable price."

Others are jumping into the fray.

Emart started selling a bucket of fried chicken for 9,980 won in July, with chicken product sales jumping 26 percent on year that month. Lotte Mart, which sells a bucket of chicken for 15,800 won, lowered prices by 44 percent between Thursday and Aug. 17.

BY LEE TAE-HEE [lee.taehee2@joongang.co.kr]