Coupang Inc's headquarters in Gwangjin-gu, Seoul, is seen Friday as access errors hit the Coupang, Coupang Eats and Coupang Play apps starting around midnight. [Yonhap]
Coupang Inc's headquarters in Gwangjin-gu, Seoul, is seen Friday as access errors hit the Coupang, Coupang Eats and Coupang Play apps starting around midnight. [Yonhap]

Coupang, Coupang Eats suffer 2-hour outage early Friday, disrupting orders and deliveries

Coupang offers up to 5,000 won in compensation; small businesses say real losses must be covered

Five groups issue joint statement demanding damage assessment, cause disclosure and prevention measures

Small business groups have pushed back collectively against Coupang Inc over a major service outage that struck the platform early Friday, demanding compensation that covers advertising costs and lost business opportunities — not just canceled orders.

Five organizations — the Korea Federation of Small and Medium Business, the Korea Merchants Federation, the Korea Food Service Industry Association, the Korea Franchise Industry Association and the National Cafe Owners Cooperative — issued a joint statement Sunday urging Coupang to issue a formal apology, draw up a compensation plan and put measures in place to prevent a recurrence.

The groups said the roughly two hours and 40 minutes of errors affecting the Coupang app and logistics center systems starting around midnight Friday "directly threatened the livelihoods of small business owners" and that the company had "abandoned its most basic platform obligation: maintaining stability."

The outage, which lasted more than two hours from around midnight Friday, knocked out access to Coupang, Coupang Eats and Coupang Play. Customers were unable to reach the apps or websites, halting product orders and food deliveries, while a systems failure at logistics centers led to some deliveries being canceled.

Coupang said the disruption stemmed from an error during a service upgrade and said it had begun processing compensation. Customers whose orders were canceled on Coupang will receive 5,000 won in Coupang Cash, while those who had food orders canceled on Coupang Eats will receive a 3,000-won coupon. Customers whose orders failed to go through will receive a 1,000-won coupon.

Delivery workers whose orders were canceled after they arrived at a store will receive 1,000 won, while those whose orders were canceled after picking up the food will receive the full delivery fee. Merchants whose accepted orders were subsequently canceled will also be compensated, the company said.

The small business groups, however, said compensation limited to canceled orders falls far short of covering actual business losses.

"Food service operators who depend on late-night delivery sales, and online merchants who had already spent money on promotions and advertising, were left bearing large opportunity costs and business losses," the groups said.

They also criticized Coupang's response after the outage began, saying the company sent only an apology text message without promptly notifying merchants of the situation or taking steps to limit the damage.

The groups also raised broader complaints about Coupang Eats' day-to-day operations, saying the point-of-sale app used by merchants frequently malfunctions, causing settlement errors, while reaching customer service has become so difficult that frustration among small business owners has reached a breaking point.

The five groups laid out three main demands. First, they urged Coupang to transparently calculate the business losses merchants suffered as a result of the outage and to prepare a comprehensive compensation plan that includes advertising fee refunds and opportunity costs.

Coupang Inc says it will provide 5,000 won in Coupang Cash to customers whose orders were canceled due to the system outage. [Yonhap]
Coupang Inc says it will provide 5,000 won in Coupang Cash to customers whose orders were canceled due to the system outage. [Yonhap]

The groups also called on Coupang to disclose the cause of the outage and the full scope of the damage, establish an emergency response and communications protocol for merchants during future disruptions, and engage in talks with small business organizations through the private delivery platform cooperation council that launched in September.


hong@heraldcorp.com