Mon, Aug 12, 2013 - Page 13 News List

FamilyMart, 7-Eleven bucking the trend

By Amy Su  /  Staff reporter

The expansion of fresh-food business has helped increase the sales of two major convenience store operators, with light meal products contributing the most under summer’s hot weather.

Despite Taiwan’s slow economy, operators of FamilyMart and 7-Eleven chain stores are expected to continue growing by enlarging their store format, offering new services and promotions, as well as increasing their own-brand item sales, analysts said.

Taiwan FamilyMart Co (全家便利商店), the nation’s second-largest convenience store operator with 2,870 stores nationally, said last week its consolidated revenue reached NT$4.81 billion (US$160.57 million) last month, up 3.77 percent from a year earlier, but slightly down 0.41 percent from June.

“The expansion of our main course menu and the introduction of creative products have helped sales of fresh-food grow by nearly 20 percent year-on-year [last month],” the company said.

With an eye on the business potential of the dining-out market, the company has expanded its rice products, which helped raise its sales of microwave products by around 30 percent last month from a year earlier.

Meanwhile, light meals — such as sandwich, vegetable and salad products — saw sales surge by 30 percent year-on-year last month, following climbing temperatures in Taiwan over summer.

FamilyMart expects sales growth this month to continue as contributions from the food sector, especially snacks and beverages, may rise on the back of seasonal demand during the traditional Ghost Festival. Based on historical experience, the Ghost Festival usually brings in about NT$20 billion sales for the nation’s food industry, the company said.

In the first seven months of the year, consolidated sales totaled NT$30.82 billion, an increase of 4.29 percent from a year ago, statistics showed.

Separately, President Chain Store Corp (PCSC, 統一超商) — the nation’s largest convenience store operator — has targeted to boost its fresh-food business in the second half of this year by expanding its vegetable and fruit products, with apples, bananas and sweet potatoes to be the main products under the fresh-food marketing strategy.

Chang Chia-hua (張家華), a vice president in the company’s marketing division, said sales contribution from the fresh-food segment is likely to reach 18 percent this year, compared with 17 percent last year.

For the first six months of this year, the company posted consolidated sales of NT$97.92 billion, up 4.72 percent from a year earlier, its stock exchange filing data showed.

“Summer is usually the peak season of the year,” JPMorgan Securities (Taiwan) Ltd analyst Caren Huang said in a note on Tuesday last week. “We expect President Chain to post a 5 percent to 7 percent sequential growth in the third-quarter revenue, in line with historical seasonality.”

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