FamilyMart eyes 30% market share in PH

TOKYO, Japan—FamilyMart, a Japanese store chain that has partnered with the Ayala and Rustan’s groups, wants to capture at least a third of the fast-growing convenience store market in the Philippines.

A newcomer in the Philippines, FamilyMart in Manila has achieved faster growth compared to expansion in Taiwan, Thailand, China, Indonesia, Vietnam and the US, said Masaaki Kosaka, who leads FamilyMart Co. Ltd.’s international business division.

Given the favorable take-up by Filipino customers and the potential for growth among convenience store chains in general, FamilyMart is aggressively expanding to corner up to 30 percent of the market in five to 10 years, Kosaka said.

It normally takes 10 years to get 20 to 30 percent market share but if everything goes according to FamilyMart’s plans, it is possible to grab a third of the market in about five years, Kosaka said.

For starters, FamilyMart wants to expand its store network. It opened 31 stores in 2013, with the first-ever branch located in Glorietta 3 in Makati City (opened in April 2013). It has more than 50 stores presently and aims reach 100 stores of more by end-2014.

Based on retail experiences in various countries, a store chain needs at least 30 percent market share to be ranked number one.

“The first year for FamilyMart in the Philippines was wonderful compared to other markets. If it were up to us, we want to get 50 percent,” Kosaka said, adding that FamilyMart will aim for a bigger market share when it attains its initial targets.

Since a store’s success depends on the preference of customers, Kosaka said FamilyMart is drawing on the Rustan’s group’s retail expertise as well as the Ayala group’s retail philosophy and access to good locations. Certain additional services may be offered once FamilyMart hits 100 store-mark, Kosaka said.

FamilyMart is also offering franchising around December 2014 to further speed up its expansion. “We are considering offering special packages for mega-franchises,” he said, adding that details will be finalized towards yearend.

In Japan, one convenience store serves about 2,000 persons compared to 42,000 persons per convenience store in the Philippines. That means there is much room for growth for all convenience store chains amid economic and population expansion. FamilyMart has about 9,000 stores in Japan.

Anton Huang, president of Philippine FamilyMart (PFM) and SSI Group Inc., earlier said in a statement that FamilyMart is working on a franchising model and may start signing up franchisees by yearend. He said franchising would hasten FamilyMart’s store roll-out while offering opportunities to hundreds of families and individual entrepreneurs who have been looking for ways to go into business.