Signs an MOU with a Local Partner
Korean convenience stores are speeding up their overseas expansion based on the popularity of K-pop and Korean TV shows. They are rapidly expanding their businesses in three countries -- Vietnam, Malaysia, and Mongolia. In particular, the three major Korean convenience stores are focusing on Malaysia.
GS25 signed a memorandum of understanding (MOU) with KK Group, a Malaysian retail giant, on July 9, to enter the Malaysian market. KK Group operates the country's largest convenience store chain that has 610 KK Mart stores nationwide. It also runs hotels and resorts.
With GS25’s entry into Malaysia, all the three major Korean convenience stores have presence in the country. Malaysia is ranked third among the ASEAN countries in terms of per capita GDP. The country is considered to have high growth potential for the convenience store business, as the average age of its entire population is 28.5 years old.
CU opened its first store in Kuala Lumpur in April last year and has recently opened its 100th store. E-Mart 24 entered Malaysia in June last year and is now running 20 stores. CU plans to expand its stores to more than 500 over the next five years, and E-Mart 24 intends to open 300 stores within five years.
The key to Korean convenience stores’ rising popularity is that they succeeded in differentiating themselves by offering Korean food. CU Malaysia’s top two best-selling items are two Tteokbokki dishes. They account for 60 percent of total sales. For E-Mart 24 Malaysia, instant food sales, including Cup Rice, Tteokbokki, Chicken Gangjeong, and Triangular Gimbap, account for 51 percent of all product sales.
GS25 plans to introduce its own original products such as Simple Cook and Cookat to Malaysian customers. It also plans to provide life-friendly services that are successful in Korea, such as half-priced package delivery services.