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Convenience chains smitten by Southeast Asia

The Ministop convenience chain is expanding in Vietnam.

TOKYO -- Japanese convenience chains are quickly opening outlets in Southeast Asia.

     The industry ballooned in Japan as operators honed their purchasing and delivery methods and came up with unique product offerings. But the value of the Japanese market has exceeded 10 trillion yen ($79.5 billion), competition is fierce and the number of promising candidate sites for store openings is decreasing.

     The operators had expanded into China by exploiting the ideas and methods that took hold in Japan. But they are now shifting their focus to Southeast Asia.

     FamilyMart this year will have a net increase of 234 stores in the region -- its biggest ever net increase in Southeast Asia. By spring, it will have a total of 1,600 locations in four Southeast Asian countries.

     More than 100 of the new stores will be in Thailand, which will have a total of 1,300 FamilyMarts. The operator will also open 74 stores in the Philippines, 39 in Vietnam and 14 in Indonesia.

     The population of the Association of Southeast Asian Nations exceeds 600 million. The region's middle-class ranks are swelling, and consumers have a growing appetite to spend.

     FamilyMart hopes the region becomes one of its core revenue spinners, in addition to China.

     Ministop, meanwhile, is going on the offensive in Vietnam. The chain entered the country in 2011 by teaming up with a Vietnamese partner. But it had difficulty expanding the number of stores there.

     That has prompted Ministop to join hands with Japanese trading house Sojitz, which has a Vietnamese food wholesaler, and Aeon, Ministop's parent, which had already forayed into Vietnam, to open 200 stores in three years.

     More competition is on the way. Retail giant Seven & i Holdings plans to open its first convenience store in Vietnam in 2017 and increase the number of stores there to 1,000 over 10 years.

     Lawson, which got a late start in expanding overseas, wants to have 500 stores in the Philippines by fiscal 2020.

(Nikkei)

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