Sandol Foods: "Not a Franchise, but Friends... Expanding Coexistence Management Globally"

A Decade-Long Promise of the Lowest Cost Ratio Drives Growth to 300 Stores

Securing Competitiveness Through Vertical Integration from Manufacturing to Distribution

Accelerating Global Expansion with Bases in Thailand and the United States

"It's not a franchise. It's friends."

Hosung Lee, CEO of Sandol Foods, introduced the catchphrase for their dining brand '33 Tteokbokki & Kkoma Gimbap' at a press conference hosted by the non-profit Happy Success at Sandol Foods headquarters in Hongcheon-gun, Gangwon Province on June 18. Coined by Lee himself, this phrase reflects the company's philosophy of fostering growth together with franchisees, viewing them not as mere contract partners but as growth partners. He said, "Coexistence is not just words, but action. The success of our franchisees is the success of the headquarters," expressing his commitment to enhancing both the profitability of franchisees and the brand's competitiveness.

The core of Sandol Foods' coexistence strategy is to maintain quality while ensuring one of the lowest cost ratios in the industry. Lee stated, "Ten years ago, I promised franchise owners that we would provide the lowest cost ratio, and we have kept that promise to this day. The cost ratio stands at around 30%, which is lower than the average of 45-55% for snack brands." Additionally, Sandol Foods regularly collects feedback through online channels and offline meetings, and supports store environment improvement costs for locations that have been in operation for more than five years.

This coexistence strategy has become the foundation for brand expansion. '33 Tteokbokki & Kkoma Gimbap' has now grown to about 300 franchise locations nationwide, and has also opened stores in special venues such as highway rest areas, resorts, airports, hospitals, and Hangang parks. This year, Sandol Foods expanded its portfolio by launching a new fresh noodle brand, 'Myeon24.' The company has set a goal of reaching 600 '33 Tteokbokki & Kkoma Gimbap' stores and 300 Myeon24 stores by 2030.

At the franchisee meeting of '33 Tteokbokki & Kkoma Gimbap' held in October 2024, attendees are taking a group photo. Sandol Foods

Manufacturing-Based Dining Business... The Core is 'Vertical Integration'

Founded in 2001, Sandol Foods reached a turning point in 2004 when CEO Lee Hosung took over. Originally a manufacturer and supplier of rice cakes, fresh noodles, and sauces, the company entered the franchise business in 2016 by launching the dining brand '33 Tteokbokki & Kkoma Gimbap' through its subsidiary Seongbaek F&S. By achieving vertical integration from manufacturing to distribution to franchising, the company says it has been able to control both cost and quality.

Sandol Foods operates an 8,000 pyeong (approximately 26,400 m²) production plant at its headquarters in Hongcheon. The 400 pyeong (about 1,320 m²) deep sleep factory visited on the day is equipped with extrusion molding machines and automated packaging facilities, handling everything from noodle production to packaging. The factory produces 25,000 noodle servings per day in an 8-hour shift, which are then combined with sauces to create ready-to-eat meals (HMR) and frozen instant foods. After the introduction of automated facilities, productivity increased by 30% and costs decreased by 15%. Sandol Foods plans to further expand process automation, starting with a large-scale sauce production line, and integrate artificial intelligence (AI) into its Manufacturing Execution System (MES).

On the 18th, an employee at Sandol Food's sleep aid factory in Hongcheon-gun, Gangwon Province, is checking the produced noodles. Photo by Ho-Kyung Choi

Expanding Global Reach with Bases in Thailand and the United States

Sandol Foods is accelerating its expansion into global markets. In Thailand, the company has partnered with Banphe Interfood, a subsidiary of the country's largest distribution and food group CP Group, to jointly launch the local brand '33 Bunsik.' The first store, which opened in Bangkok in October 2024, is a small location of just about 2 pyeong (approximately 6.6 m²) but has achieved monthly sales of 12 million won. At the local business briefing held in March, the company announced that it was pursuing contracts for more than 100 stores, with plans to expand to 1,000 locations in the future.

In North America, Sandol Foods is accelerating its entry into major distribution networks. The company became the second Korean firm to sign a 'master supplier' agreement, allowing it to supply products directly to all 4,500 Walmart and Sam’s Club locations in the United States. Sandol Foods plans to target the K-food demand with a range of frozen ready-to-eat meals (HMR), such as Kkoma Gimbap and Bibimbap, which can be prepared using only a microwave. The company also intends to use the U.S. as a base to expand into Mexico and other Central and South American markets.

CEO Lee remarked, "It's not easy to replicate the same taste at overseas stores," adding, "We are standardizing recipes by quantifying cooking processes as much as possible." To preserve the brand’s unique identity, Sandol Foods directly supplies sauces and key rice cake ingredients produced in Korea to overseas markets, while allowing some local processing and adaptation to suit local food cultures. However, the headquarters R&D team is directly involved in menu testing and product development during this localization process. Sandol Foods invests more than 2% of its annual sales in R&D to strengthen product quality competitiveness.

Hosung Lee, CEO of Sandol Foods, is introducing the products displayed at the Sandol Foods headquarters in Hongcheon County, Gangwon Province, on the 18th. Photo by Ho-Kyung Choi

This content was produced with the assistance of AI translation services.