Japanese convenience store chain in aggressive PH expansion mode
Banking on the rising affluence of the Philippines’ middle class, Japanese retailing giant FamilyMart Co. Ltd. unveiled Monday an aggressive expansion program that will see the convenience store chain open up to 40 new stores around Metro Manila this year.
More importantly, the country’s positive economic prospects are such that FamilyMart’s local principals—Store Specialists Inc. and Ayala Land Inc.—plan to grow the network to 300 branches in five years, putting it on a competitive market position with its more established local rivals.
In a briefing on Monday, company officials said that 19 new stores would be opened “soon”, with the rest of the 40-branch target for 2013 to be rolled out at a pace of one outlet per week.
“The Philippine economy is growing and there is a growing need for convenience store services,” said Store Specialists Inc. executive vice president Anthony T. Huang.
He acknowledged that some of FamilyMart’s product lines are priced at a premium to those of their competitors like 7-Eleven and Mini Stop, but noted that its other product lines are priced “at parity” with those of the competition.
“We actually have an entire range of products at various price points,” Huang said.
FamilyMart—the world’s second-largest convenience store chain—opened early this month its first store in the Philippines, located at Glorietta 3 in Makati City. Three more stores are being put up in Makati, namely at the Ayala MRT Station, Glorietta 5 and Dela Rosa Carpark 1. Four more branches will open at Exchange Regency in Pasig, Global One Center in Eastwood, Metro Point Mall in Pasay and The District in Cavite City.
The Philippines is FamilyMart’s eighth market outside Japan. The local company is 60-percent owned by the Store Specialists—Ayala tie-up (itself a 50-50 venture) and 40-percent owned by the Japanese principals, led by Itochu Corp.
Itochu, FamilyMart’s largest shareholder, is one of the largest trading conglomerates in Japan with businesses ranging from food and logistics services to textiles, machinery and information and communications technology.
Both FamilyMart and Itochu are listed on the Tokyo Stock Exchange.
SIAL CVS, on the other hand, is the partnership between Varejo Corp. and Specialty Investments Inc., wholly-owned subsidiaries of Stores Specialists and Ayala Land.
FamilyMart stores sell a variety of Japanese food items and ready-to-eat meals. “The first store in Glorietta models the high-quality design and service standards that everyone can expect for succeeding FamilyMart stores,” the company statement said.
“We believe that by jointly working on the FamilyMart business with the Ayala Group and the Rustan’s Group, two of the most trusted names in the Philippines, we will be able to leverage the Ayala Group’s extensive knowledge of store properties and its store development know-how, along with the Rustan’s Group’s retailing industry know-how, and thereby establish a store operation with a stronger foundation in the Philippines, as well as achieve faster store expansion,” FamilyMart said in a statement.
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