Taiwan FamilyMart Co (全家便利商店), the nation’s No. 2 convenience store chain, yesterday said that it would allocate NT$3.25 billion (US$96.84 million) to capital expenditures this year to stimulate sales growth.
The amount is the highest in five years, and is to be used to improve support infrastructure and renovate the chain’s convenience stores, the company said.
The company said that it hopes to offer more than 50,000 seats across its 2,978 stores nationwide after its major renovation push this year to promote in-store spending.
In addition, the company is to launch more “large-format” convenience stores, which offer products by a number of other partner retailers.
The company said that it has plans to introduce between five and 10 FamilyMart stores integrated with Great Tree Pharmacy (大樹連鎖藥局) and two or three stores integrated with Tanhou (天和鮮物), a supplier of fresh produce, while more stores are to offer light meals by Japanese fast food chain Yoshinoya.
Sales by convenience stores only grew at about half the pace of the 4 percent annual rise recorded by nation’s retail sector, with the slowing momentum signaling that the market is becoming saturated, FamilyMart chairman and CEO Yeh Jung-ting (葉榮廷) said in a statement, citing government data.
Yeh said that innovation and new business products are the only path toward growth as the industry matures amid discouraging macroeconomic factors.
He also said that FamilyMart is to set up its own bakeries to improve its food product mix, adding that it has upgraded the quality of coffee beans used in the chain’s Let’s Cafe store-brewed coffee brand.
The company is to continue to test new business models and store formats to tap into newly identified consumer needs and replicate approaches that have proven to be effective, Yeh said.
New approaches include the new FamilyMart-Tanhou stores, which are to offer refrigerated fresh produce, as well as packets containing prepared ingredients that allow customers to quickly prepare meals at home.
The company also said that it has allocated more than NT$50 million to improve its temperature-controlled logistics capabilities to aid development of its in-store delivery pickup service for fresh produce and food products.
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