JAPAN’S Lawson convenience store franchise, owned by businessman Lucio Co, can only establish up to 20 branches by year-end.
Leonardo Dayao, president of Cosco Capital Inc., said that all 20 branches are already secured and construction is under way.
“But it will be best effort for us to reach the 50 stores by the end of the year,” Dayao said.
Cosco is Co’s holding firm where Puregold Price Club Inc. is folded. Lawson is under Puregold.
Co said that each store costs about P5 million to construct. So far, the four operational stores are located in densely populated areas such as Santa Ana in Manila, Pasig area, Baclaran in Pasay and Anonas in Quezon City.
Dayao said it will take some time for the Lawson stores to be seen in central business districts due to several factors like high rent and acceptance of the brand.
Puregold is known to establish stores in densely populated areas as it tries to capture consumers where they live near.
The company said earlier that 50 of its Lawson branded stores will be rolled out by the company this year. PG Lawson Inc., the joint venture between Puregold and Japan’s Lawson Asia-Pacific Holdings Pte. Ltd. and Lawson Inc., will operate the said stores.
“Under the partnership, Lawson will provide its expertise in convenient stores know-how and product development, while Puregold will provide its expertise in product procurement and localized knowledge of the retail consumers,” the company said.
In June last year, Puregold entered a joint venture with the parents of Lawson, which also operates a chain of convenience stores in Japan and in Indonesia.
Puregold, in its report, said it will invest some P350 million for the joint venture to take on 70 percent, while Lawson contributed some P150 million for its 30-percent share.
The said P500-million investment will be part of Puregold’s total capital expenditure for the year of about P5.5 billion.
Puregold said its convenience store venture is part of the company’s strategy to expand to other store formats.
Dayao said that a separate team is being formed to operate the supermarket joint venture with the Ayala Land Inc.
The said venture, tentatively named as Mercado, will operate the grocery shops in all of the new malls to be put up by Ayala Land. At the moment, the supermarket in Ayala mall is being operated by concessionaires that include Puregold.
Dayao said, however, Mercado will be an entirely separate team and would not come from Puregold.