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Convenience store brand Seven-Eleven Japan Co. will open its first store in Beijing this month, according to Noritomo Banzai, board chairman of Seven-Eleven Japan Co.
The 24-hour store in downtown Beijing, covering an area of 187 square meters, will open on April 15 and provides over 2,000 commodity categories.
As the first Chinese-foreign chain-store joint venture approved by the Ministry of Commerce, Seven-Eleven (Beijing) Co., Ltd. was jointly invested by Seven-Eleven Japan, Beijing Shoulian (Capital Allied) Commercial Group Co., Ltd. and China National Sugar and Alcohol Group Corporation, with a registered capital of US$35 million, the three parties putting in 65 percent, 25 percent and 10 percent respectively.
According to Noritomo Banzai, the joint venture has got the go-ahead from the licensor Seven-Eleven, Inc. (US) to open convenience stores in Beijing, Tianjin and Hebei as well as the nearby regions.
Cheng Hong, deputy director of Beijing Municipal Bureau of Commerce, said Beijing is expected to see a boom of convenience stores in the next few years based on an annual growth of over 10 percent in retail sales over the past seven years.
Total retail sales in 2003 exceeded 190 billion yuan (US$23 billion).
"Two structural changes are ongoing in Beijing's retail market, one is the expansion of chain selling," said Cheng.
Seven-Eleven Beijing will encounter strong competition since there were 1,600 community chain stores in Beijing by the end of last year, covering 70 percent of the residential communities in the city.
But Noritomo Banzai said Seven-Eleven Beijing still has enough development space as experts estimated that the market in Beijing could contain as many as 3,000 to 5,000 convenience stores.
The joint venture plans to open 50 outlets this year and up to 500 in five years, with an annual sales target of 2.8 billion yuan (US$337 million).
(Xinhua News Agency April 8, 2004)
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