fbpx
Monday, October 3, 2022
HomeNewsFierce competition between the Convenience Store industry

Fierce competition between the Convenience Store industry

With new local and foreign convenience stores continue to mushroom across the nation, reflecting dynamic shifts in consumption trends, notwithstanding the economic impact of the Covid-19 pandemic.

The rapid expansion of convenience stores such as 7-Eleven, MyNews, FamilyMart and CU over the last decade, and most recently emart24 — South Korea’s third largest player which debuted in Bangsar, Kuala Lumpur, last June during the pandemic may well be attributed to their novelty offerings and ease of accessibility.

Convenience stores, along with mini-markets, provision shops and wet markets are, after all, among the essential trades which have been allowed to operate throughout the pandemic.

When u take a glance at the latest chain to jump on the convenience store bandwagon, South Korea’s swanky emart24, is telling of what appeals to consumers of today. The outlets are technology-­enabled and feature striking interior design as well as an array of imported goods from its country of origin.

Street food such as bulgogi chicken cupbap, K-spice cupdak (finger food), claypot ramyun and snow bingsu make for a quick and attractive pick-up, which Malaysians are familiar with thanks to the popularity of South Korean entertainment. There are currently 17 emart24 outlets in Peninsular Malaysia, with its operators planning for up to 50 outlets by year end, and a total of 300 outlets in five years.

The master franchisee behind Shinsegae Group’s emart24 — private equity firm Karin Associates and United Frontiers Holdings (UFH), a company controlled by Mamee-­Double Decker managing director Tan Sri Pang Tee Chew — decided on emart24 when their existing relationship with the (Shinsegae) group presented the opportunity.

Shinsegae carries brands such as private label No Brand, which is sold at local emart24 outlets. Karin Associates and UFH believe their association with the group will lend credence to branding and provide accessibility to launch Shinsegae’s other brands in Malaysia.

Retail analysts and consultants observe that ready-to-eat selections at convenience stores have created a new avenue of growth, contributing significantly to store sales. In the past, outlets had typically relied heavily on the sales of tobacco and other dry items.

“Overseas, it’s common to grab a box of lunch from a convenience store to eat at the desk on a busy day. The grab-and-go trend has taken off here, thanks to FamilyMart’s example when it debuted in Malaysia in 2016 and shook up the industry. Local consumers have since been receptive to buying fresh meals from convenience stores as opposed to waiting in line for takeaways from restaurants in the city or highly populated areas,” says an analyst with a bank-backed research house.

QL Resources Bhd’s wholly-owned Maxincome Resources Sdn Bhd is the master franchisee of the FamilyMart chain.

MyNews Holdings Bhd followed suit with a processing centre in Kota Damansara for the preparation of ready-to-eat meals and confections. In addition, MyNews’ undertaking of the CU franchise had been hoped to give the group an edge in the convenience stores space with its promotions and collaborations with well-known figures and brands.

Meanwhile, 7-Eleven Malaysia Holdings Bhd launched its own café — 7-Café — offering imported drinks and over-the-counter meals and desserts, while consumers turn to foreign brands such as Mix Mart, CU, emart24 and FamilyMart for food products from China, Japan and South Korea.

“Such novelties have contributed to the chains’ popularity as most people have not been able to travel during the pandemic,” Retail Group Malaysia managing director Tan Hai Hsin points out.

The popularity of the ready-to-eat meals concept even prompted mini-­mart players such as KK Mart to launch several KK Concept Store outlets in the Klang Valley focusing on ready-to-eat meals, while confections player Moonlight Group tested a similar idea known as Moonlight Concept Store in Johor Baru. Also in the mix is the Uncle Don’s restaurant chain, which debuted with UD Express, a food and beverage express store retailing pre-packed food products and a fast food counter.

RELATED ARTICLES

Leave a reply

Please enter your comment!
Please enter your name here

- Advertisment -

Most Popular

Recent Comments