MANILA – The supermarket unit of the SM Group is entertaining the idea of joining the convenience store bandwagon as retail chains go smaller.

JC Mendoza, SM Supermarkets president, told InterAksyon.com that the number of companies going into that segment of retailing is something worth looking into.

“Any format that is a player within the retail industry, we have to take a look at that. We cannot ignore them. Right now we don’t have a competence [in that area] but we’re looking into it, among other things,” Mendoza said.

“It’s difficult to ignore them. There’s 7-11, Ministop–they’re over a thousand branches already. You also have the combo units of Mercury, they also offer groceries. Parang convenience store na rin yun,” he added.

An SM Supermarket is always located inside SM malls, offering groceries and fresh produce. Its other bigger format is the SM Hypermarket, a standalone retail store that offers a combination of groceries and dry goods like clothing and appliances.

SM’s smallest format is the Savemore brand, penetrating neighborhoods in Metro Manila and the provinces. It can go head-to-head with Purehold Jr., the mid-sized format of SM’s closest competitor, Puregold Price Club Inc.

Puregold has a smaller format, the Puregold Extra, which offers a “very limited” number of stock at discounted prices.

In its website, Puregold said it’s the number one retailer in the hypermarket format, as well as the second biggest retailer with 159 stores.

According to Mendoza, Puregold and SM are almost equal in terms of the number of branches nationwide. In terms of residential area penetration, the SM Group is still the largest, he said, quoting a Nielsen survey done last May.

Mendoza said the SM Group has 160 branches of SM Supermarkets, Hypermarkets and Savemores nationwide, excluding Waltermart stores of the Lim family.

SM has a partnership deal with Waltermart, in which the Lim family will retain management control of the new company.

“Right now they’re doing very well and we do not see any need to fold it in under an SM umbrella. At this stage we’re exchanging best practices because there are certain things they can learn from us and there are certain things we can learn from them,” Mendoza said.

Like in Calamba, where Waltermart and SM City Calamba are adjacent to each other, both see no need to merge since “over the years they have developed their own patronage and we have also developed our own patronage,” Mendoza said, adding that they complement each other.

He said the SM group has grown its supermarket unit organically but is open to acquiring other retailers, even the mom-and-pop shops that Puregold is targeting.