The Business – (Australia)

Business Structure & Operation

The Group is spread across several entities, mainly supermarket operations, wholesale distribution and property.

The Lay Brothers Group consists of 13 companies registered in Australia; 6 of which operate supermarket outlets , 2 entities wholesale Asian foodstuffs and the remaining 5 companies own commercial and residential properties.

Date established:

Operations commenced in 1986

Business Location:

The main administrative office and warehouse is located at 23-29 David Street, Dandenong (Melbourne).

The supermarkets are strategically spread throughout Melbourne at St Albans, Flemington, Springvale, Box Hill, Richmond, Footscray, Glenroy and soon to be established, Coburg.

The Australian business operations of the companies are split between Wholesale Business and Supermarket Trade. A high level summary of their activities is provided below.

Wholesale Business

Lay Brothers Pty Ltd purchases Asian foodstuffs predominantly from China and solely wholesales products to the Group’s companies. Approximately 70 per cent of Lay Brothers total purchases are imported, with the remaining 30 per cent sourced from local suppliers. 50 per cent of foodstuffs are then on sold internally to Lay Brothers Wholesale while the remaining 50 per cent is purchased by the Group’s chain of supermarket companies.

Lay Brothers Wholesale Pty Ltd purchases the entirety of its wholesale Asian foodstuffs from Lay Brothers which is then supplied externally to restaurants and third party grocery retail outlets

Supermarket Trade

6 companies operate 9 supermarket outlets and 1 company controls the land and building for a proposed supermarket to be opened October 2012. Supermarkets operate under the trading names of either ‘KFL Supermarket’, ‘Tatsing Food Store’ or ‘Supa IGA Supermarket’. The outlets have been strategically positioned in suburbs within the state of Victoria which are recognised for having a high proportion of Asian residents. The supermarkets sell a mixture of Asian and general groceries which are sourced predominantly from Metcash and other independent local suppliers (80 per cent), with the residual 20 per cent of supplies being purchased internally from Lay Brothers. The supermarkets also supply goods directly to various restaurants and third party grocery retail outlets in a limited capacity.

The Group intends to expand the supermarket chain into New South Wales with plans to develop land at Burwood which is owned by their company, Advance Prosperity Australia.

A total of 7 supermarket outlets lease premises which are owned by property holding companies within the Group or Kian and Fun Lay, shareholders of the corporate trustee companies in the Group and beneficiaries of the various associated trusts. A further supermarket which rents 2 premises which are subject to leases with either an inter-group company or Kian Fun Lay, plus a third party. The remaining supermarket is subject to a lease arrangement with a third party proprietor.

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