FamilyMart opens 1st franchise chain outlet in China
SHANGHAI, Dec. 27 Kyodo
Japan’s major convenience store operator FamilyMart Co. on Monday opened its first franchise chain outlet in Shanghai after China lifted a ban on foreign FC outlets earlier this month.
The store opening follows China’s move on Dec. 11 to relax restrictions of foreign investments in the country’s distribution industry, marking the third anniversary of its entry into the World Trade Organization.
FamilyMart, which currently owns 43 directly operated stores in Shanghai, plans to change most of them to the franchise chain-based system and boost the number of outlets to 350 in Shanghai and neighboring areas by 2007.
In China, competition among foreign convenience store operators is expected to intensify as another major Japanese convenience store operator Lawson Inc. intends to increase the number of its outlets in Shanghai to over 300 next year from 210 outlets currently.
The Chinese convenience store market seems to be saturated, as there are 4,000 to 5,000 outlets in Shanghai, mostly capitalized by Chinese companies. But FamilyMart aims to overcome Chinese rivals by offering better services and products in quality.
FamilyMart President Junji Ueda said, ”We believe that we can win if we can open a lead in terms of service and quality control by utilizing our management system in Japan.”
Ahead of the country’s end on the ban on foreign companies’ franchise chain outlets, FamilyMart in May set up a joint venture in Shanghai with trading house Itochu Corp. and a Taiwanese food company, and started operations in July to prepare for the opening of its first franchise chain outlet in China.
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