LAWSON

Industry Analysis

Lawson, Inc. ( 株 式 会 社 ロ ー ソ ン , Kabushiki gaisha Rōson) is a convenience store franchise

chain in Japan. The store originated in the United States in Cuyahoga Falls, Ohio, but exists
today as a Japanese company (subsidiary of Mitsubishi Corp) based in Shinagawa, Tokyo.

Lawson has massive expansion with its growth overseas: has more than 5,200 stores in China,
In August 2011, Lawson opened its first Indonesian store in Jakarta, began opening stores in
Thailand in 2013, first branch in Manila (Philippines) in 2015, and did exist in South Korea after
the 1988 Summer Olympics (since 1995, the Lawson right had been bought by the Kolon Group
and in 2000 was absorbed into the 7-Eleven franchise).

Lawson, one of the largest convenience store chains in Japan with more than 10,000 shops in
Japan and more than 400 in China and Indonesia--has different color against its competitors,
namely 7-Eleven, FamilyMart and MiniStop. 7-Eleven implements its marketing strategy with
providing pre-prepared foods and has mass production of onigiri in Japan market. Both Lawson
and 7-Eleven (and the rest competitors) have their own bandwagon in creating campaign and
improving their scale in each country..

Speaking of industry evaluation, the environmental factors that are fundamental to be

highlighted are market size, demographic trends, regulatory factors, technology developments,
supplier channels, consumer habits and social considerations (Exhibit 1). According to the
analysis, Lawson is well‐positioned since it has 4.86% of annual growth. Pertinent to the data
accumulated, Lawson presents innovation to its customers responsively due to price sensitivity
by providing variations of pricing (from affordable to premium products).

A Porter’s Five Forces analysis (Exhibit 2) further amplified this reasoning. As could be seen on
the addendum, Lawson has proven its strong presence with rapid expansion, both local and
abroad, especially in Asia countries. Lawson is a great player when it comes to convenience
store segment, which it offers many novelty provided through products and services. Beside its
various adoption toward technology development and its consumers preferences, Lawson faces
direct amd indirect competitors. However, it embraces the challanges as opportunities to grow
wider by improving the other aspects, such as the power of buyers, suppliers, etc.

Strategic Groups & Positioning

Differentiated retail formats are bundled into convenience stores' strategic groups of
competitors. It comes from direct convenience store segment, with Lawson's biggest direct
competitors consisting 7-Eleven, FamilyMart, and MiniStop. As the indirects ones are from
supermarket actors and club warehouses, which they also have strong position in the industry,
especially in local Japan, Asia, and worldwide expansion.

Exhibit 3 shows a portrait of Lawson's main competitors from various store formats and styles.
To compete against them, Lawson has to win their consumers' heart and wider their scope of
brand awareness, despite being rapid in expanding their store numbers.

Competitor Analysis

Based on the data shown in Exhibit 4, Lawson plays a big role in the convenience store industry
against its biggest competitors (i.e. 7-Eleven, FamilyMart, and MiniStop). Regardless, the overall
price points area on average level, since the tight competition, which they have similar target
market, store format and scale, and their products offered are also alike to each other. Even so,
Lawson itself has evolved by showing its unique value propostions, such as the high quality
(premium) products, more jumped into "organic" or natural products by providing Lawson
Natural, and consistent in giving the best consumers shopping experience as it could.

Competitive Positioning

Apart from the strict competitions against other players in the industry, Lawson has still hold
the good position in the market. Along with its massive expansion, Lawson also reveals how its
team maganed to be sophisticated to attenuate with current trends, adaptive to its target
market based on country culture, value, and so on. To be said, Lawson has big room to grow
with its unique selling proposition, without being a copycat of others. The depiction on the
overall addendum has been a proof of how Lawson are in safe space to compete.

Addendum

Exhibit 1: Environmental Analysis

Convenience Store Industry (1) Lawson

Market Size $ 37.7 billion ¥2.4 trillion ($18.6 billion)

Annual Growth 0.9% 4.86%

Demographic Trends  appeal to a wide portion of  attune to local consumers

the population looking for behavior and latest trends
everything from a simple  caters to those who are
beverage to a meal. health-conscious with its
 attract a variety of vast array of health foods
 customers in every socio-
economic category.
 offer fresh and healthy
prepared food items but
also partner with the junk
food association
Regulatory Factors  Regulation exists: FDA
approval
Technology  implement new solutions
Developments and IoT (internet of things)
devices to improve their
relationships with
customers (e.g. self-
checkout, Wi-Fi, online
apps)
including organic, gluten-
free and vegan items
 jump on the social media
bandwagon with online
branding to attract
consumers from many
different ages
 innovate continously to
provide a plethora of
shopisticated products and
services to follow the
trends (e.g. going with
Korean Food like "odeng",
in which it is popular now
as the improvement of K-
celebrities around the
global market)
 practice hygiene
management based on the
HACCP concept in order to
prevent incidents such as
food poisoning and
contamination
 utilize big data consumer
analytics and unveiling new
strategies, including
entertainment to increase
fun and convenience, e-
commerce initiatives,
financial services and
improved efficiency
through digital technology
such as Twitter branding,
RAIN RFID technology
(enables wireless
connectivity for individual
items while also allowing
 us to deliver frictionless
consumer self-checkout
and loss prevention)

Suppliers  Wide range of suppliers  wide variety of business

transactions with various
domestic and international
suppliers (they formulated
the Lawson Group
Purchasing Policy, which
constitutes their supplier
selection standards)

Consumers  Consumers behavior is  responsive due to price

Preferences/Social constant state of flux sensitivity by providing
Factors  Consumers still tend to variations of pricing (from
have food price sensitivity affordable to premium
(price over brand) products)
 Consumers experience is a
must for better profitability
and increase loyalty

(1) Convenience Store Industry from various countries (Source: Ibis World, Explore
Research, CSP Daily News)

Exhibit 2: Porter’s Five Forces Analysis:

Common Gorcery Industry C-Stores Segment

(C-stores, supernarkets, etc)

Intensity of Competition Extremely competitive since Competitive among c-store

this industry has many actors chains, but also face both
both local and overseas (big direct and indirect conpetitors
numbers of competitors), as mentioned below for
consisting C-store chain, examples:
 supermarket to minimart,  Direct competitor
kiosk, c-store, local example: 7-Eleven
traditional, arterial,  Indirect competitors:
roadhouse, transit etc major supermarket
brands, restaurants,
etc.

Power of Suppliers  Suppliers have less  C-stores items like

power foods and drinks have
great bargaining
power of suppliers.
Basically, c-stores can't
take a great amount of
supply as much as
common supermarket
type stores.
 Some of c-stores
usually set up a joint
venture, for example:
7-Eleven with Nestle.
They don't need to
face great bargaining
power of suppliers.

Power of Buyers  Consumers are in  Price sensitivity is not

great position. They as high as
have power in supermarkets.
selecting among  Consumers are in
various brands, great position of
products, etc flexibility in choosing
 Pruce sensitivity is the stores or products
high they want.
 since it has no
monopoly, it could be
said that consumers
have power in this
industry

Substitute Products Consumers can make most items are substitutable,

 substitutes for example: prepared onigiri,
instant noodles, cup of
softdrinks, and so on.

Barriers to Entry Barriers to entry depend on
how well the relationship are
built among food suppliers,
brand exposure and its
customer loyalty rate
It's easy to entry for new
actors (competitors). There
are many similar industry with
various scale of store format
and style.

Exhibit 3: Strategic Groups Within Convenience Store Chain Industry:

C-Stores Supermarkets Club

Warehouses

7-Eleven Lotte Mart Costco

FamilyMart Carrefour Daiei

MiniStop Aeon

Source: WWD, Profilpelajar.com, Top-Rated.online

Exhibit 4: Competitor Analysis:

Lawson 7-Eleven Family Mart MiniStop

Value  high  Fun, fresh,  customer  provides

Proposi shopping and chilled oriented family-like
tion experience 24-hour and warmth and
 releases place to go focuses on comfort.
new  offers growth  Known as
products innovative  Offers tax-free
every private exhaustive shop, which
season that brands like product provides
often Slurpee, big mix fresh
become bite etc. options to products
very popular  successful its such as
 High- franchise soft-serve
 Quality, model and is customers ice cream
such as its seen as a  offers and hot
sweets benchmark numerous snacks, as
brands like in the similar tax-free well as
Cupke, industry service lunch
premiom  focuses on  Provides boxes,
roll cakes, digitization regular beverages,
Baschee, etc such as and sweets,
 operates delivery apps premium miscellaneo
separate products us goods,
stores with and many
similar more.
names, e.g.  famous for
Lawson its cold
Store 100, sweets such
Natural as soft
Lawson, and serve.
so on  Eat-in-
space
available to
all
customers
with
restaurants
-like setting
(seating
area)

Geogra 14,656 domestic 78,029 stores in 19 24,574 stores 1,907 domestic,

phic (Japan), 4,872 countries worldwide 137 abroad
Presen international
ce

Price  Average  Average  Average  Average

Points  Sales on  Offers  Frequent  Periodical
certain loyalty promos on promotions
season, like program special
twin date where events
disc (11.11, customers
 12.12), can earn and
special redeem their
events points
(Ramadan, (7REWARDS)
etc).  various
 Discounts in discounts
the form of and deals
reward
points are
applied to
products
such as
“bento”
lunch boxes
and “onigiri”
rice balls
that are
approaching
their expiry
dates
 10 to 20
percent
pricier than
other local
stores

Capabil  One of  First largest  Second  has its own

ities largest national c- largest c- unique
national c- store in store in brand of
store chains Japan Japan fast food
in Japan  renowned  diversified  Under a big
 Has rapid brand revenue AEON as its
expansion globally and stream parent
overseas has stores beyond group
 provides across Services  Has various
novelty multiple sector and variety of
towards countries Retail ready-to-
society’s including US, (Grocery) eat food
 ever- Canada, segment products
changing Asia, Europe,  market  Strong
diverse Australia etc. share support
values  known for increases from
 offets in- digital rapidly business
store value- outlook with partners
added many and has
services innovative their own
such as apps distribution
financial  Strong center
services, relationship
credit etc with big
suppliers
 Massive
expansion
worldwide

Target  mid and  Middle class  Middle and 

Market high-end and upper upper class
market class
positioning individuals
 Solidly white
collars with
limited
leisure time

Source: Lawson, Asahi, Matcha-jp, China Daily, mba SKOOL, 7-Eleven, Wikipedia, EMBA pro,
Live Japan, FamilyMart, MiniStop

References

CSP Daily News. (2022). March 27, from

https://www.cspdailynews.com/amp/technologyservices/4-key-trends-c-store-technology

Explore Rsearch. March 26, from https://explorerresearch.com/learn/convenience-store-

insights/
Futur IoT (2019). March 26, from https://futureiot.tech/lawson-of-japan-brings-iot-to-
consumable-items/

Holiday Tours (2022).March 26, from https://www.holidaytourstravel.com/japan-convenience-

stores/

Huuhka, A., Shimizu, N., & Laaksonen, M. (2010). Strategic differentiation in the Japanese
convenience store business. the example of Lawson’s format variation. European retail
research, 149-172.

Ibis World. March 26, from Convenience Stores in the US - Market Size 2005 - 2028 - IBISWorld

Lawson (2023). Wikipedia. Retrieved March 13, from

https://en.m.wikipedia.org/wiki/Lawson_(store)

Lawson. March 26, from https://www.lawson.jp/en/about/purchasing_policy/

Mba Skool. (2022). April 1, from https://www.mbaskool.com/business-concepts/marketing-

and-strategy-terms/1617-convenience-store.html

Mitsubishi Corp. March 26, from https://www.mitsubishicorp.com/jp/en/bg/consumer-

industry-group/project/lawson/

Prezi. (2015). April 1, from https://prezi.com/vfjjut4iwrtx/porter-five-force-of-circle-k-

convenience-stores/

Statista (2022). https://www.statista.com/statistics/810907/lawson-store-net-sales/. March 26,

Tan, C. S. L. (2013). Humanizing Twitter in retail: How Lawson, a convenience store chain in
Japan fused cute culture and social media. Journal of Economics, Business and Management,
1(2), 197-200.