E-commerce / RetailJapan
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JOURNEY · DETAIL
Lawson: From its First Shanghai Store to 7,000 Stores, Foreign Convenience Store Fresh Food Differentiation and Localized Expansion in the Chinese Market
Founded: Shu Miyakoshi, Takashi Fujiwara · Lawson (China) Investment Co., Ltd.
JOURNEY
Key Fields
FIELD STAMPSIndustryE-commerce / Retail
RegionJapan
ScaleGiant
ChannelOther
Origin
In 1996, Lawson entered China as the first foreign-funded chain convenience store, opening its first store in Shanghai in an attempt to replicate the mature model of Japanese 24-hour convenience stores in China. At the time, China's convenience store market was virtually blank, and urban white-collar workers' demand for fast, hygienic fresh food was unmet. Lawson entered with Japanese fresh foods such as onigiri and bento as its point of differentiation. However, early direct copying of the high-cost Japanese directly-operated model led to years of losses, prompting a massive contraction in the 2000s, followed by a shift toward a master-franchisee model and localized supply chains, gradually figuring out a survival path adapted to the Chinese market.
Milestones
1996
Inception Turning Point
Lawson opened its first store in China in Shanghai, becoming the first foreign convenience store enterprise to enter the Chinese market. Initially directly replicating the Japanese directly-operated model, store rent and labor costs were high, and the fresh food supply chain relied on Japanese imports, making single-store profitability difficult. Between 1996 and 2000, the number of stores was only in the dozens, with continuous losses, marking the company's first major failure turning point in history.
2001
Model Adjustment Turning Point
Lawson China introduced a master-franchisee model, partnering with regional real estate developers or retail enterprises where franchisees undertook store investments and local resources, while Lawson exported its brand, products, and operational standards. In 2003, it launched the "Lawson Convenience" brand, lowering the franchise threshold and leading to gradual store growth. However, supply chain localization was still not fully resolved, fresh food loss rates were high, and regional store profitability varied. Around 2010, the nationwide store count was only about 300, far behind FamilyMart and 7-ELEVEN. This phase lasted from 2001 to 2010.
2013
North China Expansion Growth
Lawson entered the Beijing market, kicking off its North China layout. The first Beijing store opened in 2013, followed by Tianjin in 2019, Hebei in 2020, and Shandong in 2024. As of August 2026, including Beijing, Tianjin, Hebei, and Shandong, the store count exceeded 1,000. North China expansion relied on joint ventures established with local partners (such as Beijing Lawson), solving supply chain radius issues through local fresh food factories (such as the Beijing Yizhuang factory), and localizing fresh food categories (such as launching Beijing roast duck wraps) to suit northern tastes, raising single-store average daily sales to industry-leading levels.
2020
South China Breakthrough Turning Point
In 2022, Takashi Fujiwara led Lawson's entry into the Guangdong market. Previously, South China was the stronghold of Japanese convenience stores 7-ELEVEN and FamilyMart, and Lawson was regarded as entering a "red ocean." He adopted a strategy combining intensive community and office building development, forming joint ventures with local supply chain enterprises to build factories. Within 4 years, stores in the Guangdong-Hong Kong-Macao Greater Bay Area exceeded 300, with plans to expand to 1,500 by 2028. However, affected by the pandemic from 2020 to 2022, some stores were forced to close and franchisee payback periods prolonged, representing a clear setback in the South China expansion.
2024
Scale Turning Point PMF
In 2024, Lawson had 6,652 stores in China, covering 17 provinces and municipalities. That same year, parent company Lawson delisted from the Tokyo Stock Exchange in Japan, completed privatization through acquisition by KDDI, and became a purely private enterprise. Following the delisting, Lawson accelerated overseas expansion, and by late December 2025, its China stores exceeded 7,000 (official data). This phase verified the feasibility of the "franchise + regional supply chain localization" model, with fresh food sales accounting for over 40% and average daily store sales of about 6,000 yuan, achieving overall profitability.
2026
10,000-Store Sprint Growth
In 2026, Lawson China announced an addition of 5,000 stores over the next six years, targeting a total of 12,000, and doubling overseas stores to 14,000. At the same time, it launched the "thousand stores, thousand faces" strategy, streamlining menus and light-weight store types for county-level markets, and piloting the "Lawson Station" light-investment model, reducing initial franchisee investment by 30% and boasting a two-year payback period as a promotional selling point. However, county-level markets have low rent but small average customer transaction values, and high fresh food delivery costs. Some county-level stores have daily sales of less than 4,000 yuan, raising doubts about whether sustainable profitability can be maintained.
Turning Points
- Abandoning the wholly-owned direct management model in 2001 and shifting to a master-franchisee model was the key turning point for Lawson China to turn losses into profits.
- Entering Beijing in 2013 and establishing regional joint ventures to solve the fresh food delivery radius bottleneck with localized supply chains.
- Takashi Fujiwara leading the South China market in 2022, capturing 300 stores from the tight grip of 7-ELEVEN and FamilyMart, verifying the red ocean breakthrough path.
- Following the parent company's delisting and privatization in 2024, overseas expansion was no longer constrained by short-term capital market financial reports, accelerating China's 10,000-store plan.
Failures & Pitfalls
- High costs from the direct management model between 1996 and 2000 led to continuous losses, stagnating store counts in the dozens and nearly forcing an exit from the Chinese market.
- Around 2005, heavy reliance on imported fresh food supply chains resulted in loss rates exceeding 15%, with daily sales at some stores falling below 3,000 yuan, forcing closures.
- Entering Sichuan in 2018 resulted in a wave of store closures and franchise disputes due to poor management by local franchisees, damaging brand reputation.
- During county-level sinking pilots, high delivery costs and low customer transaction values led to average daily sales of only 3,500 yuan at some stores, failing to reach the break-even point.
关键成功要素
- Fresh food differentiation: Japanese fresh foods like onigiri and bento account for over 40% of sales, forming differentiated competition against mom-and-pop shops and e-commerce platforms.
- Regional supply chain localization: Building fresh food factories in Beijing, Guangdong, Sichuan, and other locations to achieve same-day delivery within a 300-kilometer radius.
- Master-franchisee model: Partnering with regional real estate developers where franchisees take on investment while Lawson exports its brand and operations for rapid scaling.
- Digital management: Membership systems covering over 30 million users, utilizing consumption data to dynamically adjust single-store SKUs and achieve thousands of faces for thousands of stores.
Lessons
- Foreign retailers entering the Chinese market cannot blindly copy their home country's model; direct management high costs nearly choked Lawson, and adapting to local cost structures is essential.
- The convenience store business is fundamentally a supply chain business; fresh food loss rates determine life or death, and a 300-kilometer radius is the lifeline for regional profitability.
- Fighting hard in a red ocean in mature markets is inferior to finding gaps; the South China experience proved that refined community + office building scenarios can break through.
- County-level sinking is not simply copying urban store formats; menu streamlining and store format lightweighting must be designed synchronously with logistics costs.
Core Data
- China Store Count：7,000 (End of December 2025) (Public data basis, independent verification not performed)
- Global Store Count：22,000 (Public data basis, independent verification not performed)
- China Covered Provinces and Municipalities：17 (2024) (Public data basis, independent verification not performed)
- Target New Stores Next Six Years：5,000 (Public data basis, independent verification not performed)
- China Target Store Count：12,000 (Public data basis, independent verification not performed)
- Greater Bay Area Store Count：300 (2026) (Public data basis, independent verification not performed)
- South China 2028 Planned Store Count：1,500 (Public data basis, independent verification not performed)
- Fresh Food Sales Proportion：About 40% (Public data basis, independent verification not performed)
- Franchisee Payback Period：About 2 years (Public data basis, independent verification not performed)
- County Pilot Store Daily Sales：About 3,500-4,000 yuan (Public data basis, independent verification not performed)
- Urban Store Average Daily Sales：About 6,000 yuan (Public data basis, independent verification not performed)
Competitors / Peers
In China's convenience store market, Lawson's main rivals are Japanese peers 7-ELEVEN and FamilyMart, alongside local brands like Meiyijia and Bianlifeng. 7-ELEVEN has about 3,000 stores in China, widely adopting regional franchising models with fresh food centrally supplied by central kitchens; FamilyMart has about 2,900 stores in China, deeply cultivating the Yangtze River Delta. Meiyijia has rapidly expanded to over 30,000 stores via a franchise model, but its fresh food share is low and its average customer spend is about 12 yuan, forming a distinct contrast with Lawson's 20-25 yuan average spend. Lawson's differentiation lies in Japanese fresh foods and private label products (such as skinless mooncake rolls and Karaage chicken nuggets), and it sinks into county-level markets more aggressively than 7-ELEVEN. Furthermore, delivery platforms (Meituan, Ele.me) and discount stores (such as Snack Busy) are also diverting convenience store customer traffic, with Shu Miyakoshi openly stating that Lawson's true competition comes from food delivery and discount stores rather than peers.