FamilyMart Malaysia launches ‘Food Superstores’ format

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Japan’s FamilyMart is making strong inroads into Malaysia, offering a new concept in retail with the focus on fresh food, ruffling the convenience store sector which has been largely dominated by 7-Eleven and MyNews.

The world’s second-largest convenience store chain after 7-Eleven has redefined the concept and has gained more foot traffic to its Japanese-style konbini since it opened its first outlet in Malaysia in 2016.

QL Resources Bhd — the franchise holder of the FamilyMart chain in Malaysia — has been expanding the footprint of the stores which offer fresh foods, snack bars, meal stations and various products from Japan.

“FamilyMart has changed the convenience store landscape in Malaysia. It has created a need for fast and fresh food in a convenience store where consumers previously go to these stores for, perhaps, fast-moving consumer goods,” TA Securities Holdings Bhd analyst Jeff Lye Zhen Xiong told The Malaysian Reserve.

Lye said FamilyMart’s business model has taken off quite well and has enabled the company to record a higher gross margin.

FamilyMart delivers an authentic Japanese konbini experience by integrating fresh food, services and daily goods in one brightly-lit outlet.

The Japanese convenience stores offer a wide variety of ready-to-eat (RTE) and microwavable meals from sandwiches, coffee and softserve ice-cream to steamed snacks, oden, onigiri and bento.

FamilyMart’s central kitchen operator QL Kitchen Sdn Bhd received halal certification from the Department of Islamic Development Malaysia in May.

In-store services include FamiPay for paying bills; FamiLoad for phone top-ups and gaming needs; FamiCashless and FamiLounge, a sit-in area that is equipped with WiFi, USB charging docks and toilet amenities.

“In terms of trend, there are more convenience stores in the likes of 7-Eleven and MyNews popping up and going for more fresh food,” Lye said.

In early October, MyNews Holdings Bhd and partners, Ryoyu Baking Co Ltd and Gourmet Kineya Co Ltd, launched their Japanese-inspired food production centre (FPC) in Kota Damansara, Selangor.

The RM100 million facility, which operates under its subsidiaries, MyNews Ryoyupan Sdn Bhd and MyNews Kineya Sdn Bhd, will supply MyNews outlets across the Klang Valley with a wide array of RTE food.

7-Eleven Malaysia Holdings Bhd, which is owned by Berjaya Retail Bhd, has been rolling out the latest generation store format in the past few years. It has expanded its services to defend its leading position in the convenience store space.

Petronas Dagangan Bhd’s Kedai Mesra has also upped its game with more staple fresh food offerings while having more Tealive outlets in its stores following collaboration with Loob Holding Sdn Bhd.

7-Eleven remains the largest convenience store chain in Malaysia with more than 2,300 stores nationwide, far ahead of MyNews at over 400 stores and FamilyMart at about 150.

Last year, 7-Eleven has lowered its target of new store opening to 100 from 200.

MyNews is expected to open at least 90 new outlets in the financial year 2019, while FamilyMart has targeted to have 300 stores by March 2022.

Lye said 7-Eleven has embarked on new strategies to boost footfall including weekly or monthly promotional campaigns on cheapest items.

Overall, he said locations and rental prices are contributing factors to the performance of a convenience store, on top of product offering.

“FamilyMart stores are located in a very strategic place. The stores are new and consumers can expect a certain standard of quality,” he added.

The convenience store market is worth billions of ringgit in transactions value and FamilyMart is taking the fight for a bigger slice of the pie.


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