After privatization in FYE 2021, greater management flexibility has allowed FamilyMart’s operation to become more customer-centric than ever before, making it possible to nimbly respond to the rapidly changing external environment and customer needs.

This feature explores FamilyMart’s goals and current status as it works to strengthen the foundation of its convenience store business and expand new businesses through the medium-term management plan, which commenced in FYE 2023 and designates a three-year period for achieving renewed growth.

Toward the Next Decade of FamilyMart

FamilyMart marked the 40th anniversary of its founding in FYE 2022, the year I was appointed president. Utilizing my experience at a general trading company running brand businesses, we are working hard to improve daily sales and profit at stores and to create a new convenience store concept that is not bound by existing frameworks.

We positioned FYE 2022 as a year to put the company on a path to renewed growth and steadily implemented measures to lay the foundation and sow the seeds for the future. A series of new hit products such as Convenience Wear and Butter Biscuit Sandwich have been introduced. In addition, we have been installing in-store digital signage, with expanding new revenue opportunities such as in the advertising and media business, generating positive feedback.

The medium-term management plan started in FYE 2023 is positioned as a three-year period for achieving renewed growth. Although we are embarking on a voyage in a difficult environment due to rising raw material and energy costs, we will strengthen the earning power of our convenience store business by enhancing product appeal, brand strength, customer base, store infrastructure, and more as we rebuild the supply chain. In addition, we intend to create a new growth cycle by expanding new businesses that leverage our convenience store business base, such as advertising, media, and finance, etc., and by creating synergies. We will also advance the “well-grounded digitalization” that contributes to store operations, such as “FamiPay” app, unmanned payment store operation, and humanoid AI assistants, as well as promoting the SDGs that are unique to FamilyMart. Our corporate message is “FamilyMart, Where You Are One of the Family.” We will continue to work together with our franchisees to become the convenience store of choice for our customers.

TRANSFORMATION１：Evolution of Value Chains, Starting with FamilyMart

In its convenience store business, ITOCHU and its Group companies are collaborating to build and strengthen the value chain, stretching from downstream through to upstream operations. To grow the value of the Group’s convenience store business, which centers on FamilyMart, we are creating synergies that transcend Division Companies’ boundaries. Specifically, while The 8th Company is acting as a hub, we not only strengthen the food value chain but also focus on such diverse areas as daily necessities, financial services, systems development, and construction materials.

Development of the Advertising and Media Business

The digital advertising distribution business currently has approximately 24 million advertising IDs, one of the most extensive collections in Japan at present. Using purchase history data, it is possible to distribute advertisements that consumers are likely to be interested in on an ID to ID basis. Additionally, it is possible to analyze the purchases by consumers who saw the advertisements. Our services are highly regarded by advertisers such as manufacturers.

We have finished installing digital signage (large display panels) for advertisements at 3,000 stores as of June 30, 2022. Out of the approximately 16,600 existing stores in Japan, we plan to install signage in every single store possible by FYE 2024, with the aim of developing our stores into a third media platform after TVs and the internet.

Evolution of Value Chains with DX

At distribution centers of NIPPON ACCESS, INC., we are installing AI automated ordering systems for 1,500 items at FamilyMart. By utilizing downstream data, we have already verified a 30% decrease in inventory and around a 50% decrease in order-related workload. We began operating AI systems at all 47 distribution centers. In addition, in FYE 2023, we plan to roll out the insights we gained from this supply chain initiative of FamilyMart to the supermarket industry, etc.