Franchise association accuses food giant of free-riding on chicken chain menus

The Korea Franchise Industry Association on Thursday urged CJ CheilJedang and relevant authorities to take action, following a report that the food giant had been selling frozen chicken products closely resembling the signature menu items of major franchise chains.

The Herald Business reported Tuesday that some products under CJ CheilJedang's frozen chicken brand Sobaba drew industry criticism for their similarity in name and concept to menu items from chicken franchise chains including bhc, Gupne Chicken and BBQ.

In a statement issued that day, the association criticized the practice, saying the signature menus of food service franchises are "precious assets built over a long time through hard work under difficult conditions and fierce competition to become beloved national dishes." It added that the conduct "cannot be seen as anything other than an attempt to free-ride on the brand recognition and consumer trust that small and mid-sized food service companies have accumulated over years at great cost, in order to reap commercial gains with ease."

The association went on to say the situation "could directly erode the sales of frontline franchisees who make their living standing in front of fryers every day," adding that "consumers will purchase those similar products while thinking of the franchise's signature menus, and this will lead to an immediate drop in franchisee sales."

The association demanded that CJ CheilJedang immediately halt the use of the product names and marketing methods at issue. In addition, it called on the government to introduce concrete corrective measures to address concerns over consumer confusion and unfair brand coattail-riding.

"We will actively respond until the matter is rectified, in order to protect the legitimate rights and brand value of franchises and to establish an order of mutual growth and fair competition," the association said.

Meanwhile, CJ CheilJedang has maintained that the controversy reflects standard product development practice in the food industry. "In the case of processed foods, it is common industry practice to recreate dishes enjoyed at restaurants so that people can enjoy them conveniently at home," a company official said. "Sobaba was also developed and introduced with that intent."