By Paul Martin · Japan China India S Korea Indonesia Taiwan Thailand Hong Kong Malaysia Singapore)...
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part of Asian c-store trends Planet Retail Ltd | November 2010 By Paul Martin
Transcript of By Paul Martin · Japan China India S Korea Indonesia Taiwan Thailand Hong Kong Malaysia Singapore)...
part of
Asian c-store trends
Planet Retail Ltd | November 2010
By Paul Martin
www.planetretail.netAsia c-store trends2 of XX
The definitive source of global retail insight
Global Retail Analysts since 1988
Monitors 10,000+ retail and restaurant operations including:
Grocery, Electronics, HoReCa, Apparel, Entertainment,
Department Store, Health & Beauty, Fashion
Used by:
78% of 10$ bio + FMCG companies;
80% of world’s top 20 retailers;
and many more
Providing critical retail insights to Suppliers, Investors and Retailers
that drive competitive advantage
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Planet Retail: Sample Clients
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1. Region overview
2. Leading retailers
3. Top channels
4. Leading c-store players
5. Top 3 regional trends
Agenda
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Region overviewRetail Sales by Market (% growth of retail sales in local currency)
5,065
4,728
1,259
831
538378
262 211 191 177
1,424 1,438
490
205 232112 84 33 55 33
0
1,000
2,000
3,000
4,000
5,000
6,000
Japan China India S Korea Indonesia Taiwan Thailand Hong
Kong
Malaysia Singapore
Reta
il S
ale
s (
US
D b
n)
Asia: Retail Sales by Market, 2004-2009 (EUR bn)
GDP
Retail Sales
Note: % change in local currency.Source: Planet Retail Ltd – www.planetretail.net
+28%
+0% +92%
+73%
+28%+101% +20% +27%
+51%+24%
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Asia: Top Grocery RetailersTop 10 retailers by sales and store numbers (% CAGR)
Retailers Sales (USD bn) Sales CAGR,
2004-09 (%) Store no.s
Store CAGR, 2004-09 (%)
AEON 88.8 11.8% 14,426 10.4%
Seven & I 68.1 9.5% 17,822 4.9%
Uny 22.6 1.8% 7,934 -0.2%
LAWSON 19.1 7.8% 11,057 5.9%
FamilyMart 18.7 8.5% 15,777 6.5%
Walmart 16.3 5.5% 688 6.1%
Tesco 15.2 18.7% 1,335 35.3%
Carrefour 12.4 9.4% 1,591 21.7%
LottteShopping
12.0 8.4% 427 33.2%
China Resources
10.5 27.9% 4,257 11.8%
Top 10 Grocery Retailers in Asia, 2009
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Winners & Losers
Winners Losers
1. Seven & I (large)
2. Lotte Shopping (medium)
3. Alfa Mart (small)
Mainly expanding through organic growth
Situated in number of markets
Situated in growth channels – eg c-stores
1. Uny (large)
2. Life (medium)
3. Tokyu Store Chain(small)
Mainly in just one low-growth market – eg Japan
Limited or no exposure in overseas markets
Situated in low growth channels – eg supermarkets
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What’s Driving Growth?
Rapidly growing markets – e.g. consumer spending per capita, has doubled in markets such as Indonesia and Vietnam over the past five years.
Growing acceptance of modern retailing – shift away from traditional sector. Health scares (e.g. Avian flu and SARs) and government policy has accelerated the trend.
Rapid expansion in store numbers – e.g. Indomaret store numbers increased from 1,018 in 2004 to 3,750 in 2009.
Mergers & acquisitions – of weaker small and medium-sized rivals, e.g. AEON acquired underperforming competitors Daiei and Maruetsu in Japan.
Greater expertise – the best Asian grocers are gaining experience in areas such as private label and management (often from foreign rivals), which is making them increasingly competitive.
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What’s Driving Growth?
Characteristics of typical fast and slow growing retailers
Fast growing retailers
Present in a number of different markets
Operates a multi-channel strategy
Primarily hypermarket or convenience store focussed
Situated in a high growth market
Slow growing retailers
Only present in a single market
Only operates a single format
Primarily focussed on supermarkets and department stores
Situated in a low growth market
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Asia: Channel growthCAGR growth of sales and store numbers by channel (%), 2004-09
7.7
14.8
8.3 8.5
10.6
8.0
14.0
10.9
13.8
7.6
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
16.0
Convenience stores Drugstores,
perfumeries & pharmacies
Hypermarkets &
superstores
Supermarkets &
neighbourhood stores
Cash & carries
CA
GR
ch
an
ge, 2
00
4-0
9 (
%)
Sales
Store no.s
Source: Planet Retail Ltd – www.planetretail.net
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C-store growth slowing – but still strong
Modern c-stores first appeared in mid-1970s when Seven & I (formerly Ito-Yokado) acquired the rights to 7-Eleven in Japan.
Rapid expansion since 1970s. 7-Eleven had 15 stores in 1974, 4,300 in 1990 and 8,600 in 2000.
The three big Japanese heavyweights (7-Eleven, FamilyMart and LAWSON) dominate the sector.
Other important players include Circle K & Sunkus (operated by Uny), GS25 in South Korea and Indonesian players Alfa Mart and Indomaret.
Store numbers are expected to increase significantly in the coming years – even in already saturated markets such as Taiwan, Thailand, South Korea and Japan.
There is huge potential in new markets such as Vietnam and India.
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No stopping the c-stores
Banner Stores, 2004 Stores, 2009 Stores, 2014 f
7-Eleven 20,830 30,216 36,341
FamilyMart 11,501 15,777 23,194
LAWSON 8,284 10,047 10,797
GS25 1,400 4,200 5,500
Indomaret 1,018 3,750 5,000
Subtotal 43,033 63,990 80,832
Asia: Leading C-store Banners by Store Numbers, 2004-2014
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0
50
100
150
200
250
300
350
400
450
Indonesia Malaysia Thailand Singapore South Korea Japan Taiwan
Nu
mb
ers o
f C
-sto
res p
er M
illion
Asia: C-stores per Head of Population, 2009
Source: Planet Retail Ltd – www.planetretail.net
There is still huge potential to grow c-stores in most Asian markets – many could see c-store numbers double to reach more mature markets of South Korea, Japan and Taiwan.
Small stores still the realm of Asian grocers
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Trend 1 – Segmenting brands to target consumers
As the channel becomes saturated in some markets, retailers are responding is by segmenting their networks into new formats designed to target specific consumer groups.
LAWSON c-storesMature business
8,500 stores
Limited growth prospects in saturated market
Decreasing sales per new store
Typical consumer is young, single male
Natural LAWSON
Launched in 2001
Natural, healthy eating focus
Aimed at young, health consciousconsumers – especially females
LAWSON STORE 100
Discount supermarket launched 2005
Located in residential areas
Targets housewives and the elderly as well as those with no transport to reach out of town grocery superstores
HAPPY LAWSON
Launched in 2006
Aimed at parents with small children
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Trend 2 – Private label on the rise
Leading players – eg Seven & I (Seven Premium) and Lotte Shopping looking to boost private label penetration to combat global grocers, boost profits, build brands and differentiate from rivals.
Eg - Lotte Shopping has aggressively pushed its private label range over the past five years with significant success.
0.0
2.5
5.0
7.5
10.0
12.5
15.0
17.5
20.0
2003 2004 2005 2006 2007 2008 2009
Sale
s (
%)
Lotte Mart: Private Label Penetration, 2003-09 (%)
Source: Planet Retail Ltd – www.planetretail.net
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Trend 3 – Going discount
Discount stores are not yet important in Asia. However, there are signs that they are gradually gaining share in some markets.
Asian grocers are already well positioned to take advantage at this early stage.
Seven & I’s The Price
Launched in Japan in 08
Groceries 25-30% less than IY superstores
30% less SKUs
Focus on PL
Pxmart
Fast growing discount format in Taiwan
100 stores in 2001
Over 500 now
Gaining market share over mainstream rivals
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1. Asia is key growth region for global and local grocers
2. Fastest growing players are those with multi-format and multi-market strategy
3. C-store channel is seeing growth slow as markets saturate
4. But, there are still huge opportunities to grow stores in low-penetration markets such as Vietnam and India
5. Regional trends point towards segmenting of brands, growing private label penetration and an increasing focus on price
Summary
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Paul MartinCommercial Director
Planet Retail Ltd
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F: +44 (0)207 728 4999
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Contact details
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