News ReleaseLawson Store to Open in Spring 2018 in Anhui, China

NEWS RELEASE

TOKYO, JAPAN, 12 26, 2017

On Friday, December 22, 2017, Lawson, Inc. (Head Office: Shinagawa-ku, Tokyo; Sadanobu Takemasu, President and CEO, Representative Director, and Chairman of the Board; hereafter, “Lawson”) signed an area license agreement in Anhui, China with Nanjing Central Emporium (Group) Stocks Co.,Ltd (hereafter, “Central Emporium”). Under this agreement, Lawson will prepare for the opening of the first LAWSON store in Hefei, the capital of Anhui, as the first Japanese convenience store chain in Anhui. The opening is planned for the spring of 2018.

Lawson entered Shanghai in 1996 through direct investment as the first Japanese convenience store chain in China. It later entered Chongqing in 2010, Dalian in Liaoning in 2011, and Beijing in 2013. Taking advantage of the expertise it accumulated in these areas, Lawson began operating stores in other regions in 2014 by signing mega-franchise agreements with local retail companies (a total of eight companies at present, which are located in the cities of Jiangsu and Zhejiang in the vicinity of Shanghai) and an area license agreement (with Zhongbai Holdings Group Co., Ltd. in Wuhan, Hubei), thereby increasing the number of stores in China at an accelerated rate. The agreement signed with Central Emporium this time is the second area license agreement.

Anhui is located in the inland area of East China. Hefei, the central city of the province with a population of about 8 million, is a “blank zone,” where there are no Japanese convenience stores or major local chains at present. However, demand for convenience stores is expected to increase in the city, mainly among young people, as a result of economic development. With the entry to Anhui, the regions of Lawson’s store network in China will consist of three direct-controlled municipalities and five provinces, which is the highest number among Japanese convenience store chains.

Under a mega-franchise contract with Shanghai Lawson, Inc. (hereafter, “Shanghai Lawson”), a consolidated subsidiary of Lawson, Central Emporium began operating LAWSON stores in Nagjing, Jiangsu in August 2017, and now operates ten stores (as of November 30, 2017). Because of the favorable performance of these stores, the company acquired the area license in Anhui, which is adjacent to Jiangsu, under the area license agreement. Moving forward, Central Emporium will open and operate stores in a highly flexible manner by taking advantage of its operating foundations in Anhui, such as shopping malls and food factories, while being supported by Shanghai Lawson. It aims to operate at least 100 stores by 2020.

Lawson will continue to open stores in China under franchise and license agreements by taking advantage of the brand power and operating expertise cultivated by its subsidiaries in Shanghai, Chongqing, Dalian, and Beijing. It is planning to increase the number of stores in China, which is currently around 1,300, to around 3,000 by 2020.

♦Summary of Two Companies

<Central Emporium>
Company name Nanjing Central Emporium (Group) Stocks Co.,Ltd
Business location Anhui, China
Established June, 1991
Capital 1.148 billion (CNY)
Total sales 6.43 billion (CNY)
Number of stores 13 stores in shopping malls
Main areas of business operation Jiangsu, Anhui, Shandong, Henan, Hubei
<Lawson>
Company name Lawson, Inc.
Business location 1-11-2 Osaki, Shinagawa-ku, Tokyo
Name and title of representative director Sadanobu Takemasu
President and CEO, Representative Director, Chairman of the Board
Capital 58.5 billion (JPY)
Total sales 2,158 billion (JPY) (FY2016 consolidated)
Main areas of business operation Development of the Lawson convenience store franchise chain
Number of convenience stores Japan: 13,693 Overseas: 1,483
(as of the end of November 2017)

♦Number of Lawson Stores Overseas

(as of the end of November 2017)
Overseas total 1,483
China Total 1,318
 China Shanghai and surrounding areas
  (Shanghai, Jiangsu, Zhejiang)
823
 China Chongqing 145
 China (Liaoning) Dalian 115
 China Beijing 68
 China (Hubei) Wuhan 167
Indonesia 36
United States of America Hawaii 2
Thailand 97
Philippines 30
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