Master Franchise Main Contract Signed with Local Company
One Emart and Three No Brand Stores Scheduled to Open This Year
"No Large Supermarkets in Laos Yet... High Growth Potential"
Emart is entering Laos for the first time among domestic large-scale marts.
Emart announced on the 23rd that it signed a master franchise main contract with 'UDEE.CO.,Ltd,' an investment company of LVMC Holdings (Korao Group), on the 22nd. A master franchise is a method where the franchisor licenses the franchise business and brand operation rights to a local company instead of directly entering overseas markets.
The signing ceremony held at Korao Tower in Laos was attended by Song Man-jun, Executive Director and Head of PL/Global Business Division at Emart, Choi Jong-geon, Emart Overseas Business Manager, Oh Se-young, Chairman of LVMC Holdings (Korao Group), and other key executives.
Emart signed the master franchise main contract for entry into Laos on the 22nd at KOLAO Tower located locally in Laos with UDEE.CO., Ltd, an investment company of LVMC Holdings (KOLAO Group). Viengthong Chanlivong, CEO of U-DEE (center left), and Song Manjun, Emart PL/Global Business Division Head (center right), along with other officials, are taking a commemorative photo after signing the main contract. [Photo by Emart]
UDEE, which signed the contract with Emart, plans to open one Emart store and three No Brand stores in Laos in the second half of this year. The company aims to expand the business by opening 20 Emart stores and 70 No Brand stores within the next 10 years.
Emart explained that this contract is significant as it marks the first entry of a domestic large-scale mart into Laos. Emart expects to establish a foothold to expand the influence of K-distribution by introducing Emart and No Brand specialty stores to the people of Laos.
Laos, with a population of about 7.5 million, is a landlocked country surrounded by five countries: Cambodia, Thailand, Myanmar, China, and Vietnam. The Laos distribution market is centered on small markets and traditional markets, with no large-scale marts yet, making it a market with great potential.
UDEE, which signed the agreement, is a company funded by Auto World (KDC), a subsidiary of LVMC Holdings. The Korao Group, to which LVMC Holdings belongs, was founded by Korean Chairman Oh Se-young, and its name is a combination of Korea and Laos. The Korao Group is known as the largest private company operating locally in Laos. It started automobile assembly and sales business in Vientiane, the capital of Laos, in 1997 and has since expanded into finance, platforms, construction, finance, and leisure sectors.
The Korao Group has diversified its business into retail distribution since last year, leveraging its recognition in Laos and its real estate and logistics capabilities. In March last year, it opened the first 'kok kok Mega Mart,' a hypermarket smaller than a large-scale mart, and in August, it opened the first 'kok kok Mini Mart,' a convenience store format.
Song Man-jun, Executive Director and Head of PL/Global Business Division at Emart, said, "Emart has signed the master franchise main contract to enter Laos as the first Korean large-scale mart. We will work closely with LVMC Holdings to widely promote the excellence of K-distribution and strive to provide high-quality products and services to the people of Laos."
Meanwhile, Emart has been conducting franchise contracts in Vietnam, Mongolia, and the Philippines since 2016. The sales of Emart Vietnam (3 stores), which entered in 2016, increased about 3.5 times last year over seven years. Similarly, Emart Mongolia (4 stores), which also entered in 2016, saw sales increase about ninefold. The No Brand specialty stores in the Philippines, which entered in 2019, have also established themselves in the market with the number of stores increasing to 17.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
