It is an indisputable fact that e-commerce has impacted physical retail, yet convenience stores have bucked the trend and grown against the sluggish retail sector. With the accelerating pace of life, consumption upgrades, and demographic shifts, the demand for "convenience" is increasingly urgent, leading to a proliferation of convenience stores across cities.

As the three most mature players in the convenience store industry, what secrets lie in the franchise models of 7-Eleven, Lawson, and FamilyMart? Let's explore today.

7-ELEVEn

7-Eleven's franchise model is divided into two types: Type A (franchise) and Type D (commissioned franchise). The similarities and differences are shown in the diagram below:

A brand is like a child to a company.

7-Eleven headquarters has the strictest screening criteria for franchisees. While stringent conditions ensure service quality, they also dampen the enthusiasm of franchisees hoping for a quick return on investment.

But, Uncle Meng (a nickname for the author) has to say "but". As the pioneer of convenience stores, 7-Eleven's management and service justify the price. When you shop at a 7-Eleven, the cashier records the customer's gender and age before payment, uploads and analyzes the data, and adjusts the store's sales strategy. The now-popular big data analysis has long been integrated into 7-Eleven's details, which is one of its core competencies.

FamilyMart

FamilyMart is also a Japanese convenience store chain, established in 1972, with 12,000 stores globally. In addition to meticulous Japanese-style service, FamilyMart excels in ice cream, bread, boxed lunches, and rice balls. However, due to local protection policies and the rapid rise of local convenience stores, the return on investment for FamilyMart franchises is not high, which is a major reason why many franchisees abandon FamilyMart for local brands.

LAWSON

Lawson is Japan's second-largest convenience store group after 7-Eleven. Its development path is very similar to 7-Eleven: both originated in the U.S. and grew rapidly in Japan.

The Next Trend

Every convenience store brand claims to open 10,000 stores in China within 3-5 years. Besides setting ambitious goals, have you ever wondered why each company dares to make such bold claims?

China's convenience store market is extremely unsaturated, and the country is on the eve of a convenience store boom.

There are three reasons:

1. Low Market Share

Japan: Convenience store market share: supermarket market share = 54%:46% China: Convenience store market share: supermarket market share = 8%:92%

2. Low Saturation

The U.S. has 150,000 convenience stores for 320 million people, meaning one store per 2,133 people. Japan has 50,000 convenience stores for 120 million people, meaning one store per 2,400 people. China has 26,000 convenience stores for 1.38 billion people, meaning one store per 53,076 people.

Excluding factors like urbanization lag and consumption habits, the convenience store gap remains huge. Domestic brands like Meiyijia, Kuai Ke, Shanghao, Xishi, Quanshi, and Haolinju continue to expand, while new brands such as Bianlifeng and Aibianli in the north, and Dingdanglaile in the south, have generated significant buzz.

3. Consumption Upgrade

Consumption upgrade refers not only to upgraded products but also to upgraded consumption formats. Supermarkets and hypermarkets offer price advantages but are now facing a "store closure wave". Convenience stores and e-commerce offer convenience advantages: e-commerce provides spatial convenience, while convenience stores provide temporal convenience, and the new retail model offers more imaginative space. Therefore, the counter-trend increase in convenience store penetration is justified.

There are over 200 domestic convenience store chain brands in China, among which there must be potential winners that could bring you great profits. Can you guess which brand will ride the next wave?

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