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SHAH ALAM (Aug 28): FamilyMart stores will see changes in product mix and a larger footprint in Malaysia to retain customers and drive sales volumes, said its operator QL Resources Bhd (KL:QL).
Retail margin is expected to stay in the “mid single-digit”, QL Resources executive director Chia Lik Khai said on Thursday. The operating environment for the convenience store chain will remain tough due to sales and service tax expansion as well as higher minimum wages and rental costs, he said.
"Our main strategy is to focus on product offerings that align with customer demand,” he told reporters after the group’s annual general meeting on Thursday. “Given weak consumer sentiment at the moment, raising prices is not an option.”
QL Resources ventured into the convenience store business in 2016 through an area franchise agreement with FamilyMart Co Ltd of Japan, which granted it exclusive master franchise rights in Malaysia.
Since then, however, the market has seen proliferation of rivals, including Korean franchises CU and emart24 as well as homegrown brands like Mix Store and BilaBila Mart.
FamilyMart is also on track to expand to 600 outlets nationwide by the financial year ending March 2027, up from 465 stores currently, Chia said.
For the first quarter ended June 30, 2025 (1QFY2026), the convenience store segment’s earnings fell 8% year-on-year due to higher operating expenses.
Revenue only rose 6% year-on-year due to lower average store sales from weak consumer sentiment despite adding a net 47 FamilyMart stores and 48 FM Mini during the quarter.
QL Resources’ mainstay businesses are in livestock farming and marine products manufacturing, which provided more than two-thirds of its revenue and earnings last year. The company is also involved in palm oil and green energy businesses.
Shares of QL closed a tad lower at RM4.13 on Thursday, valuing the group at about RM15 billion.