Singer Lee Hyo-ri drew attention after describing her husband Lee Sang-soon's experience running a cafe on Jeju Special Self-Governing Province, offering a blunt account of what it takes to open a coffee shop. Customers lined up for hundreds of meters, she said, yet the business never earned what the crowds suggested it would.
The number of coffee and beverage outlets in Seoul has in fact fallen from a year earlier, a sign of how saturated the market has become.
Seoul Coffee Shops Fall by 492 in a Year as Margins Stay Thin
Seoul had 27,351 coffee and beverage outlets as of the second quarter of this year, according to data from the city's commercial district analysis service released on the 6th. That compares with 27,843 in the same period last year, a decline of 492 over 12 months.
During the same period, 1,040 coffee and beverage outlets opened and 992 closed. Nearly 1,000 cafes shut down in a single quarter while a similar number of new shops entered the market, pointing to fierce competition for survival.
With the cafe market already large, rising costs for rent, labor and raw materials mean that drawing crowds alone no longer guarantees profitability, industry observers said.
'Hundreds of Meters of Lines, and Still Not Much Money'
The difficulty of running a cafe has also surfaced in the accounts of well-known entertainers.
On JTBC's variety program "Love War," broadcast the previous day, Lee Hyo-ri asked a participant who hoped to open a cafe whether the person understood how hard the business is, and cited her husband's experience operating a cafe on Jeju.
Lee Sang-soon opened the cafe on Jeju in 2022. In its early months it was popular enough to draw lines stretching hundreds of meters, and the number of visitors exceeded expectations to the point that the cafe later switched to a reservation-only system.
"People lined up for hundreds of meters and it was chaos, but we didn't actually make much money. Cafes are very risky," Lee Hyo-ri said. Her point was that heavy publicity and large visitor numbers do not translate directly into profit.
The cafe operated for about two years and closed in May 2024. The reason, however, was not financial trouble but the expiration of the lease. Lee Sang-soon said at the time that the contract period had ended.
Two Years of Operation, Losses of Up to 200 Million Won
Rapper Hanhae, who appeared on the same program, also disclosed that he had run a cafe before closing it. Hanhae said he operated a store selling yogurt and coffee in Seoul's Sangam-dong three or four years ago. "I ran it for two years, but only six months of that was real business. The other 18 months I was just holding on," he said. "The losses alone came to 150 million to 200 million won."
He pointed to fixed costs such as rent and competition from low-price coffee franchises as the main reasons for the failure. "Opening a cafe looks romantic from the outside, but once you factor in the rent it's hell," Hanhae said. "Even if I sold a cup of coffee for 2,000 won, the franchise store right next door was selling it for 900 won. Competing was impossible."
Cafe operators say the burden has grown recently not only from rent and labor costs but also from prices for key inputs such as coffee beans and milk. Aggressive store openings by low-price coffee franchises have further intensified competition among outlets within the same commercial district.
Cafes are also seen as a business with relatively low barriers to entry, which keeps new entrants coming, and the intensity of competition can vary widely depending on the location and price range. Experts say prospective owners should weigh rent, labor costs, input costs, average spending per customer and table turnover together, rather than jumping in based on foot traffic or buzz alone.
