Japan’s largest supermarket group, Aeon, is accelerating its expansion in China, where it expects to have opened at least 2,000 outlets in the next decade, reports the Financial Times (FT).
Aeon's chief strategy officer Jerry Black told the FT: “I don’t think that we have any cap below 2,000 stores. No matter how fast we grow between now and 2020, I don’t think we will reach market saturation. I don’t see any `barriers to growth` below 2,000 stores for Aeon `in China`.”
Aeon’s aggressive expansion plans in China reflect the retailer’s urge to catch up quickly and overtake western rivals, such as Walmart, which has more than 300 stores in China, and seek growth outside of its home market, where the ageing population is shrinking, the FT said.
Aeon aims to derive 50 per cent of its operating profits outside Japan from Asia by 2020 compared with about 10 per cent now, according to the report.
Between 2011 and 2013, Aeon plans to allocate 25 per cent of its Y830bn (US$10.3bn) in capital spending to markets in the Association of Southeast Asian Nations countries and China compared with only 8 per cent in the period from 2007 to 2009.
The group has also been hiring large numbers of Chinese and other Asian staff both locally and in Japan.
“We will be hiring 200,000 people in the years up to 2020, and 80 per cent of them won’t speak Japanese,” Mr Black said.
Aeon will focus on growing its Asian operations in markets such as Malaysia and Thailand and, on a parallel track, build its presence in China, where it has 37 stores at the moment, Mr Black said.
No comments yet