Mynews brings S. Korean CU chain here
November 13, 2020
The convenience stores (c-stores) scene is getting saturated in the Klang Valley and beyond but that has not deterred listed Mynews Holdings Bhd (Mynews) from signing a licence agreement with S. Korean BGF Retail Co Ltd (BGF Retail) to bring the CU c-stores to Malaysia via its subsidiary, MYCU Retail Sdn Bhd. Founder of Mynews, Dang Tai Luk, thinks that the c-store segment is still young and full of potential. Mynews currently has 530 outlets in Malaysia.
BGF Retail is controlled by its Chairman, Hong Suk-jo, who is the brother-in-law of the late Samsung Chairman, Lee Kun Hee. Hong’s sister is Hong Ra-hee, wife of Lee Kun Hee. CU stands for “Convenience for You”. The CU chain was created when BGF Retail’s franchise agreement with Japan’s FamilyMart came to end. FamilyMart has been rebranded as CU. The partnership began in 1990 when the first FamilyMart started business in S. Korea. It grew to close to more than 7000 FamilyMart stores by 2012. BGF Retail’s owner, Hong Suk-jo wanted to create an independent brand that promoted Korean products rather than Japanese and the conflict led to FamilyMart exiting the S. Korean market. BGF’s market share of the c-stores in S.Korea is about 33%. Japan’s FamilyMart chain is owned by 150 year old Japanese sogososha, Itochu Corporation, a mega conglomerate.
Ambitious plan-500 CU stores
Mynews has a 10 year licence to build up a chain of CU stores in Malaysia beginning in 2021 with an option to renew for another 10 years. Group CEO and controlling shareholder of Mynews, Dang Tai Luk, has ambitious plans to set up 500 CU stores in 5 years. He is convinced that a Korean c-store with all the Korean favourite products and snacks would be a draw for Malaysia’s millennials and the young Hallyu crowd just as FamilyMart has been popular with the young people. CU stores will face direct competition with FamilyMart and established market leader 7-Eleven ( part of Tan Sri Vincent Tan’s Berjaya Group) besides other c-store formats. FamilyMart with its Japanese offerings has been a big hit in the Klang Valley and within 3 years has become profitable. QL has deep pockets to continue its FamilyMart expansion which has 184 c-stores as at March 2020.
Dang Tai Luk, 60, Group CEO of Mynews, founded the company as a single newstand and print media outlet called MAGBIT at One Utama, Petaling Jaya in December 1996. Under his stewardship, Mynews morphed into a retail convenience chain with several businesses under its wing and was listed as Bison Consolidated Berhad on the Main Board of Bursa Malaysia on 29 March 2016. The company’s name was changed to Mynews Holdings Bhd on 11 December 2017. Mynews has a partnership (50:50) with UK based WH Smith Travel Ltd, under the name of WH Smith Malaysia Sdn Bhd to operate WH Smith outlets at Malaysia’s international airports.
To date, the wholly-owned subsidiaries of Mynews are involved in the following businesses: Retail convenience chain outlets, Dine-in Café offering a variety of Japanese & Western fusion food, Information Technology (“IT”) support services, Management services to the Group and Investment holding in food related businesses. In 2017 Mynews collaborated with Gourmet Kineya Co. Ltd and Ryoyu Baking Co. Ltd. to produce Ready-To-Eat Halal meals and bakery products for its outlets.For FY 2019 Mynews achieved a revenue of RM517.8m and pre-tax profit of RM32.97m. This year 2020 will be a challenging year for all retail formats with controlled movement orders in place that has decimated public footfall to most food, entertainment and retail outlets. Mynews is no exception.
Brandwise, Mynews began as a print media and newstand outlet which the public frequents to look at the latest magazines and to pick up snacks. When magazine publisher Blu Inc Media Sdn Bhd which has been in business for 40 years folded up in April 2020, a whole host of popular magazines were taken off the shelf of Mynews outlets. They include CLEO, Cosmopolitan, Female, HerWorld, Home & Décor, Marie Claire, Shape and The Peak. Blu Inc Media was set up as a joint venture with SPH Magazines in Singapore. With its shelves bereft of such a vital attraction for habitual walk-in consumers eager to browse or buy the latest lifestyle magazines, Mynews seems to have lost its raison d’etre. Will Dang Tai Luk convert its Mynews stores to CU outlets?
- Advertising & Marketing. 30 April 2020. Janice Tan. Blu Inc Media folds amidst digital disruption and COVID-19. https://www.marketing-interactive.com/blu-inc-media-folds-amidst-digital-disruption-and-covid-19
- Options. 14 December 2019. Anandhi Gopinath. MyNews Holdings founder and CEO Dang Tai Luk on entrepreneurship and the art of reinvention. https://www.optionstheedge.com/topic/people/mynews-holdings-founder-and-ceo-dang-tai-luk-entrepreneurship-and-art-reinvention
- Nikkei Asian Review. 29 March 2014. FamilyMart calling it quits in South Korea. https://asia.nikkei.com/Business/FamilyMart-calling-it-quits-in-South-Korea
- Korea JoongAng Daily. 19 June 2012. Kim Jung-yoon. Rebranded Family Mart will CU later. https://koreajoongangdaily.joins.com/2012/06/19/industry/Rebranded-Family-Mart-will-CU-later/2954734.html
- MyNews Holdings Berhad. Annual Report 2019. http://mynews.com.my/investors.php
- The Malaysian Reserve. 13 October 2020. Shazni Ong. MyNews to operate S. Korea’s CU stores in Malaysia https://themalaysianreserve.com/2020/10/13/mynews-to-operate-s-koreas-cu-stores-in-malaysia/
- Retail in Asia.2 October 2019. In Young Bae. Korea’s convenience store chains seek growth abroad. https://retailinasia.com/in-trends/koreas-convenience-store-chains-seek-growth-abroad/
- The Korea Times. 23 June 2017. Park Hyong-Ki. Hong sibling sells BGF Retail shares. https://www.koreatimes.co.kr/www/biz/2017/06/488_231821.html
- The Star. 26 August 2020. Itochu aims to take FamilyMart private. https://www.thestar.com.my/business/business-news/2020/08/26/itochu-aims-to-take-familymart-private
- The Japan Times. 8 July 2020. Itochu planning ¥600 billion bid for Japan’s FamilyMart chain. Bloomberg. https://www.japantimes.co.jp/news/2020/07/08/business/corporate-business/itochu-bid-for-japans-familymart/
- Itochu Corporation. https://www.itochu.co.jp/en/about/message/index.html
- The Star Online. 30 March 2015. Nevash Nair. Well, I’ll be Dang. The Star Media Group.
- Bison Consolidated Berhad. 18 December 2017.Announcement to Bursa Malaysia on change of name from Bison onsolidated Berhad to MyNews Holdings Berhad. https://www.bursamalaysia.com/about_bursa/media_centre/change-of-name-bison-consolidated-berhad-to-mynews-holdings-berhad
- Nikkei Asia. 19 July 2020. Yuma Ikeshita and Shihho Miyajima. 7-Eleven rethinks 'convenience' in Japan's new normal. More frozen food, less rice balls just part of revamped layout -- the first in 50 years. https://asia.nikkei.com/Business/Retail/7-Eleven-rethinks-convenience-in-Japan-s-new-normal