China Resources Enterprise (CRE) has finalized acquisition with Tesco to create the largest food retailer in China by the end of May, 2014. The joint venture will combine Tesco’s 135 outlets in the country with CRE’s almost 1,000 stores, called Vanguard. Vanguard owns various business types such as hyper-marts, convenience stores, supermarkets and others. Among these outlets there are more than 250 hyper-marts. It is crucial for CRE to effectively carry out integration and store optimization plan after the acquisition.
To better execute store network optimization, brand owners need to fully understand market potential and penetration of targeted city. Reviewing performance of current stores and comparing actual performances against potential’s to get a clear picture.
Steps of SNO (Store Network Optimization)
Scorecard: to assess each branch and analyze competitor distribution
Channel optimization: overall planning of current stores (keep, improve, move or close)
Market expansion: site selection of new stores in terms of untapped high potential areas
Central FamilyMart Co, the main local operator of FamilyMart convenience stores, is exploring new market opportunities amid fierce competition by offering a mobile store format to boost its customer base. Read the rest of this entry »
The evidence lies in the numbers. Convenience stores can now be found at every corner in Bangkok and major provinces. Each store serves 3,000 households nearby today, compared to 10,000 in 1989, when the first convenience store was opened in the country.
Convenience stores will see their Shanghai market share rise faster than big supermarkets, an industry research shows. FamilyMart, the Japanese retailer, will almost double its market share to 7.9 percent, while Hong Kong-based Watson may also expand 2.6 percent, according to a research report released by TNS Global. Bigger retailers like Carrefour and Tesco may find their profits eroded as shoppers develop brand loyalty to convenience stores, it says.