Coupang Eats, Baemin clash in '3 AM duel,' increasing costs for owners and consumers

Coupang Eats has expanded its late-night delivery service, and Baedal Minjok (Baemin) has followed suit, launching its own delivery operations during the early morning hours in select areas of the Seoul metropolitan region. Coupang Eats, which previously suspended service from 3 AM to 6 AM, announced a shift to 24-hour operations. In response, Baemin, which had only offered its own delivery service (MP) during those hours, has now introduced its own delivery operations between 3 AM and 5 AM, intensifying the competition.

Industry insiders express concerns about the deepening platform monopoly and the potential for a domino effect of closures among regional delivery agencies. These agencies had considered the hours when platform deliveries were suspended as their core operating time, allowing night riders to earn significant income from late-night snack and convenience store deliveries. However, with Coupang Eats and Baemin now operating 24/7, regional agencies face a sharp decline in their late-night order volume. This could trigger a vicious cycle: reduced orders lead to rider departures, which in turn degrade dispatch quality and ultimately force agencies to close. One delivery agency recently informed its riders that "due to a significant decrease in call volume from Coupang Eats' 24-hour operation, it is difficult to guarantee income for night shift riders. With Baemin also starting operations until 5 AM, difficulties in late-night operations may arise." The agency is considering adjusting its operating hours.

Concerns are also mounting over the lack of transparency in delivery fee structures. Typically, regional agencies pay riders approximately 3,100 won out of a 3,500 won base delivery fee. However, major platforms often do not disclose their fee calculation standards and may dispatch riders at rates as low as the early 2,000 won range, citing off-peak hours. Riders are often compelled to accept these lower rates, with the difference between the consumer's delivery fee and the rider's payment becoming platform profit.

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Due to a significant decrease in call volume from Coupang Eats' 24-hour operation, it is difficult to guarantee income for night shift riders. With Baemin also starting operations until 5 AM, difficulties in late-night operations may arise.

The shift towards platform-centric delivery services also threatens the marketing options and delivery fee control previously available to restaurant owners. This is particularly noticeable with Baemin, which had historically provided owners with some autonomy in choosing their delivery methods. Previously, owners using Baemin's own delivery service during late-night hours could set their own delivery fees, with consumers sharing a portion of the cost. However, as Coupang Eats and Baemin dominate this time slot with their own delivery fleets, owners will be required to pay a fixed commission of 3,400 won per order to the platform. This eliminates the flexibility owners had in managing food prices through options like "store delivery coupons."

Furthermore, the contraction of regional delivery agencies could negatively impact smaller delivery apps like Yogiyo, as well as public delivery services such as Ddankyo and MeokBBey. These services rely on regional agencies for their delivery operations, and a decrease in the number of agencies directly weakens their service infrastructure. An official from a smaller delivery app stated, "We currently handle all deliveries through agencies, but more and more are closing down. If the number of agencies decreases due to the expansion of 24-hour delivery by major platforms, another monopoly issue could arise." If struggling regional agencies raise their fees to survive, it could lead to a chain reaction of increased delivery costs for smaller platforms that depend entirely on these agencies. One restaurant owner predicted, "If platforms relying on delivery agencies find it harder to secure delivery vehicles, consumer choice will decrease, and the market will likely become dominated by Coupang Eats and Baemin."

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If the number of agencies decreases due to the expansion of 24-hour delivery by major platforms, another monopoly issue could arise.