---
title: "Convenience Stores Accelerate Expansion, Intensifying Competition"
description: "Convenience store chains are rapidly expanding, with store counts doubling for some regional players, particularly in lower-tier markets. However, industry data shows that while overall scale grows, average revenue per store is declining, and major players like FamilyMart and Bianlifeng are losing momentum."
author: "晴山"
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published: "2024-06-03"
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# Convenience Stores Accelerate Expansion, Intensifying Competition

> Convenience store chains are rapidly expanding, with store counts doubling for some regional players, particularly in lower-tier markets. However, industry data shows that while overall scale grows, average revenue per store is declining, and major players like FamilyMart and Bianlifeng are losing momentum.

**Store Counts Double**
"Our store openings this year have doubled compared to previous years, and profitability of franchised stores in county towns is the best it's ever been," said a regional convenience store executive. The executive noted that while store counts in existing second- and third-tier cities haven't increased, franchising in lower-tier markets has grown. "In county-level franchising, repeat franchisees are common; last month, 70% of profits came from existing franchisees opening second, third, or fourth stores. Sometimes a single franchisee will cover an entire county." Currently, convenience stores are one of the few retail sectors experiencing significant growth. At the convenience store conference held in May, the China Chain Store & Franchise Association released the "2023 China Convenience Store TOP100," with the top 100 companies operating a total of 182,412 stores. In 2023, national convenience store sales reached 424.8 billion yuan, an 11% year-on-year increase, with the store count reaching 320,000, up 7% year-on-year. Several notable changes from the top 20 include: First, Lawson China has accelerated its expansion in recent years. Lawson's total store count reached 6,330, ranking fifth, ahead of 7-Eleven (seventh) and FamilyMart (eleventh), but behind Meiyijia, Sinopec Easy Joy, PetroChina Kunlun Hao Ke, and Tianfu, making it the only foreign brand in the top five. Second, FamilyMart and Bianlifeng have notably slowed down. In terms of store growth, FamilyMart added only 41 stores in 2023, while the other two Japanese convenience store brands, 7-Eleven and Lawson, added 587 and 689 stores respectively. According to the "2022 China Convenience Store TOP100" list, FamilyMart ranked tenth with 2,666 stores, but in 2023, it fell out of the top ten to eleventh place with 2,707 stores. Additionally, Bianlifeng, which ranked fifteenth with 2,005 stores in 2022, dropped to twenty-fifth place with 1,510 stores in 2023, a decrease of 495 stores in one year. Third, industry concentration is high. The top five companies have 95,799 stores, accounting for 52.5% of the total on the list. The top ten have 115,741 stores, representing 63.5% of the total. In other words, the top ten companies account for over 60% of the listed stores. Fourth, regionally, Guangdong remains the "holy land" for convenience stores, with 11 companies from the province on the TOP100 list; followed by Shandong with 8; and Beijing, Shanghai, and Fujian tied for third with 7 each. Notably, third-, fourth-, and fifth-tier cities are seeing significant growth and are the focus of future expansion, with over 60% of new stores on the TOP100 list located in these areas.

**Bianlifeng and FamilyMart Lose Momentum**
Comparing the past three years' lists, Bianlifeng's slowdown is particularly evident. According to the "2021 China Convenience Store TOP100" list, Bianlifeng ranked eleventh with 2,800 stores. By 2022, it had 2,005 stores, ranking fifteenth, and by 2023, it had 1,510 stores, dropping out of the top 20 to twenty-fifth place. Looking back, 2021 may have been a turning point for Bianlifeng. Despite the pandemic's adverse impact on offline retail, Bianlifeng, having just completed a financing round of over $100 million, chose to expand against the trend. That year, it added 748 stores, about 1.79 times the number added in 2020, bringing the total to over 2,800. At the same time, Bianlifeng launched its second growth curve, the "store-in-store" beverage station "Bumianhai," offering nearly 50 specialty coffees and new-style teas in cities like Beijing, Shanghai, Tianjin, Nanjing, and Hangzhou, with prices reduced to under 10 yuan through heavy discount coupons. The aggressive expansion soon hit a wall. In early 2022, Bianlifeng announced the cancellation of year-end bonuses for all employees due to underperformance, and many positions faced salary cuts. Mid-year, the company initiated three rounds of layoffs affecting logistics, middle office, operations, and other departments. The coffee and tea business was forced to stop, and the fresh food factory in Tianjin stalled. By the end of 2022, Bianlifeng internally proposed a "hibernation plan," closing over 700 loss-making stores, reducing the total to 2,005. This extreme contraction reflected Bianlifeng's cash flow pressures. According to public information from Tianyancha, Bianlifeng's last financing round was in May 2020. The company rarely disclosed specific investors and amounts, only emphasizing that new shareholders included top global PE firms, sovereign wealth funds, top university funds, and large internet companies, with cumulative financing reaching $1.5 billion. As the financing environment cooled, Bianlifeng, which insists on an asset-heavy, high-investment direct-operated model, has yet to see profitability and had to find its own way out, paying for the "burning money" behavior of 2021. Similarly, FamilyMart has been in a state of "stalling" in recent years. Since 2020, its total store count has been declining year by year. According to data from the Chain Store & Franchise Association, FamilyMart had 2,967 stores in 2020, decreasing to 2,902 in 2021, 2,666 in 2022, and 2,707 in 2023, an increase of 41 from 2022. Compared to the other two foreign convenience store brands, Lawson and 7-Eleven, Lawson's total store count was 4,466 in 2021, 5,641 in 2022, and 6,330 in 2023, an average annual increase of over 900 stores. 7-Eleven had 2,893 stores in 2021, 3,319 in 2022, and 3,906 in 2023, growing at about 500 stores per year. In contrast, FamilyMart has become the laggard among the three foreign brands. In response, FamilyMart's assistant president Tong Weiguo publicly stated that the company plans to "make a big push" and accelerate expansion.

**What Is the Future Endgame?**
Although Lawson ranks fifth, ahead of 7-Eleven (seventh) and FamilyMart (eleventh), with rapid scale growth, it is worth noting that Lawson's recent delisting has drawn industry attention. Previously, Japan's Lawson announced that it would delist on July 24 after an extraordinary general meeting expected in July. The "delisting" refers to the delisting of Lawson's stock. Ms. Zheng from Lawson China's president's office responded to media that this is due to internal equity changes and investment strategy adjustments in Japan's Lawson and will not affect normal operations. Although the stock delisting does not affect store operations, the adjustment also reveals the significant pressure Lawson faces in operations and transformation. In a notice on its official website, Japan's Lawson mentioned that the industry faces not only intensified competition and diversified consumer demand but also rising costs for raw materials, labor, and logistics. Japan's Lawson believes that "this transaction will help improve corporate value." Meanwhile, competition in China's convenience store market is intensifying. Lawson must compete for market share with fellow Japanese brands 7-Eleven and FamilyMart, while the rise of local Chinese chains and the popularity of instant retail add pressure. At the 2024 China Convenience Store Conference held on May 17, Lawson China President Miyake Nobuhiro admitted that customer traffic and items per transaction are growing, but the average transaction value is declining. He also noted that the value of physical stores has been reassessed, and the decline in sales is more due to competition around residential communities, platform promotions like Douyin, delivery diversion, and the impact of discount snack stores. Industry insiders say that the domestic convenience store industry has entered a stock market, where brands face competition not only from local convenience stores and mom-and-pop shops but also from supermarkets' online businesses and instant delivery e-commerce platforms. It cannot be ignored that while Lawson struggles with digital transformation, the industry's shift to a stock market, limited new growth, and cross-industry competition from supermarkets and e-commerce platforms are impacting Lawson's market position, indicating a new round of elimination in the convenience store market. In the past few years, with capital support, China's convenience store industry experienced rapid expansion. Now, among nearly 320,000 convenience stores, like coffee, milk tea, and noodle shops, convenience store companies are seeking new growth by expanding into lower-tier markets, which has become industry consensus. Coupled with recent policy guidance, many convenience store brands have begun to go down-market, moving into third- and fourth-tier cities and even county-level markets.

It is worth noting that the industry is still developing rapidly, but with intensified competition, both average sales per store and average population covered per store have declined to some extent. Simply put, with more stores opening, head-to-head competition intensifies. Looking at the development of the convenience store format in recent years, "one hot, one cold" is the most accurate description. The hot part is the continuous growth in scale; the cold part is the declining average revenue per store. In terms of scale, the total number of convenience stores nationwide has grown rapidly in just three years, from 132,000 in 2019 to over 300,000 in 2023, which translates to an average of over 150 new convenience stores opening every day. In terms of revenue per store, the average daily revenue per store in 2021 was 5,297 yuan, which fell to 4,794 yuan in 2022. In the past few years, China's convenience stores have achieved scale in numbers, but operating a convenience store is not a simple task; doing it well requires meticulous work. As Zhang Li, chairman of Jianfu Convenience Store, who calls himself a "peddler," said, "Retail is inherently hard work with thin margins. We must respect the laws of things. Doing difficult but correct things takes time. We cannot force growth and waste our efforts."

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