JapanConsuming: Headlines April 2014

by admin on April 7, 2014

Polarising Market: winners and losers in Japan’s leading city markets
Japan is facing a major drop off in population over the next 40-60 years – and the decline has already begun. Government forecasts expect a reduction of as much as a third of the current 127 million people. But not all cities or regions will lose population as quickly as others and some will actually increase. In Japan’s Top 100 Markets: Now to 2025, JapanConsuming has produced the first ever English language guide to Japan’s leading markets. The main conurbations, and especially the cities around Tokyo, will see an influx of new residents as people move for better access to entertainment, services, health care and jobs. These cities will gain the lion’s share of investment and marketing of consumer goods and services. The new report helps to work out which markets to focus on.

Urban Research: 50 stores a year pace, 20% plus sales growth
Urban Research used to be a standard select shop, but has begun to diversify into the premium brand business, providing opportunities for overseas brands, and into mass market SPA retailing. It has seen sales rise from just ¥3 billion in 2001 to an expected ¥35 billion in FY2013 and is projecting an increase of 20% to ¥43 billion this year.

Editorial: Identifying the best markets

Large store sales surge in 2013: top 50 department stores up 4.7%
2013 was a good year for retailing, and the results for the 12 months to December mirror the early financial year results now appearing. Department stores did particularly well, with the higher end stores far outperforming suburban and regional stores.

Number of new SCs remains steady
The number of newly opened SCs doubled in 2013 compared to 2012, and a similar number is in the pipeline for this year too. More competition is good news for retailers and brands, but means choosing ever more carefully where to locate stores and which retailers to sell to. A shift towards more diverse merchandising is creating opportunities for overseas retailers to bring in new formats, and for brands selling homeware, interiors, food, and fashion.

Price wars loom as tax hike takes effect
The much anticipated Consumption Tax increase came into force at midnight on 1 April, with consumers stripping shelves of some product and others buying gold bullion just in case. Unlike 1997 when the tax was last raised, retailers are much more savvy today and a range of price cuts and campaigns have already been announced. Price has suddenly become the key criteria for a lot of consumption choices.

MCM: ¥10 billion sales per year
German bag brand MCM was a major hit in Japan in the 1980s but pulled out more than a decade ago due to weak sales. Since being taken over by a Korean retailer, the brand has seen a revival and will relaunch in Japan this month with ambitious plans for sales of ¥10 billion in three years.

Lanvin up 10% to ¥37 billion
Itochu Shoji is master licensee for a myriad of brands, but some are more successful than others. One of its biggest hits in the last few years has been Lanvin, which it signed in 2002 and which it has built up from a ¥15 billion a year business to ¥37 billion largely through a successful licensed second line, Lanvin en Bleu.

Look buys Laisse Passe
Look has increased its share of the premium imported brand market in apparel, accessories and footwear through assiduous signings and investment in the last five years. It now plans to expand its own retail brands into Marui and the better shopping centres, acquiring womenswear retailer Laisse Passe last month to accelerate the process.

Seiyu introduces ‘satisfaction guaranteed’ policy for fresh foods
In an unprecedented move for Japan, Walmart has introduced a ‘satisfaction guaranteed’ policy for fresh foods throughout its entire 374 store Seiyu chain. Previous attempts to introduce what is a standard policy for Walmart overseas floundered due to dismissive store employees, but Walmart hopes the new move will help improve quality standards throughout its supply chain, reduce wastage, and impress the customer all at the same time – even offering money-back on food that has already been eaten.

GU: sales of ¥100 billion this year
GU has grown from scratch to sales of ¥83 billion in seven years and expects to hit ¥100 billion this year. It continues to expand store numbers rapidly while working on new, more fashionable merchandising as it begins to expand overseas.

Running Boom continues
Jogging has its fanatics in every country, but in Japan the sport has a fast expanding base of some 10 million people of all ages. Perhaps more than many countries, the enthusiasm for pounding the pavement is matched or even exceeded by the love of accessorising the daily ritual.

Sunkus loses another 100 stores
Circle K Sunkus is looking increasingly shaky. Owned by Uny Group, the chain used area franchises to expand rapidly in the 1990s, giving branding rights to companies with geographical exclusivity. Many of these contracts are now coming to an end and a growing number of franchisees are switching allegiance to one of the larger players. The latest defection by Sunkus Keihanna in Kansai is the biggest so far, but more are expected.

Nitori: 15 years of record profits, sales up 11% to ¥386 billion
Nitori appears to go from strength to strength. Despite having a business based on direct imports from China, last year it overcame higher costs due to the weakened Yen, and with particularly high demand in the final quarter, reported another record performance. The company is introducing higher quality lines and opening more stores, both at home and overseas. It sees demand rising again after a six month post tax lull, and expects more low cost homeware chains to emerge in the next few years.

Fashion retailers expect 10-30% of sales online
The growth in fashion e-commerce concerned many fashion retailers at first but most at least accept its inevitable growth, and some are now embracing it. A recent survey suggests more than half of firms believe online sales will account for 10-30% of the total, but a few think e-commerce should account for more.

Home centres grow 0.9%, but sector struggling to compete
Home centres are Japan’s answer to DIY stores in the West, but it is a sector that overlaps heavily with GMS chains and one that increasingly finds it hard to compete. 2013 was a reasonable year, but all of the 0.9% growth in sales came from new space added by just a handful of top companies. Like supermarkets and drugstores, the sector could well be in line for a major shake-out very soon.

Familymart to pull out of Korea
Familymart is the number three convenience store chain, but it is losing sales share to both of the larger two firms. Now, its core strategy of overseas expansion has taken a major blow with the chain planning to pull out of Korea, wiping out 60% of overseas stores.

Retail Data: Retail sales up 3.6%

News in Brief
More updates for Isetan-Mitsukoshi
IKEA to open in Tachikawa, Sendai store confirmed
J Front targets young women
Gransasso starts Japan sales
Itochu buys Edwin
American Eagle to add four stores this Spring
Sazaby League signs Rachel Ashwell Shabby Chic Couture
Zara Home opens in Aoyama, more stores coming
Hanshin Umeda to be rebuilt by 2021
Apparel imports rise 21%
Shibuya 109 to open in Kyushu
Uniqlo launches app to sell direct from flyers
JR East plans 66,000 sqm SC in Yokohama
Alibi Alley closes in Osaka
Life, Seven & I raise wages
Seven Eleven to acquire 500 JR WEST in-station stores
Grand Front Osaka gets 46 million visitors
Arcs acquires Belle Group
Felissimo opens two outlet stores
JR West expands retail ambitions
Familymart opens hybrid store in Tokyo
Izumiya & H2O Retailing report ¥920 billion in sales
Valor acquisitions continue
Yamada Denki introduces first checkout free, smartphone payment system

JapanConsuming Headlines: March 2014

by admin on March 7, 2014

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Get ready for 20 million tourists
Japan has the lowest levels of inbound tourism among advanced economies, but this is about to change thanks to lavish marketing, the growing affluence of neighbouring populations, Japan’s increasing soft power, and in 2020 the Olympics. The benefits to retailers and brands will be immense.

Focus: The Senior Market has arrived
The fact that Japan has the most rapidly ageing population in the world may be well known, but the impact of this change is still only vaguely understood. Retailers, however, are at last beginning to think through the implications and respond – they have little choice.

Editorial: Retail Sales Booming

Isetan-Mitsukoshi launches more small format stores
Isetan-Mitsukoshi has already proven its capacity to think beyond department stores through a series of small format concepts, and it will launch two more in the next year. These are helping the department store group reach new customers and better serve its core target too. Given the scale of investment, calling Isetan a department store business could well become a misnomer in a few years. Other department stores are looking at similar moves too.

Marui, Shimamura, Honeys to hold down prices from April
Although regulations demand that powerful major retailers don’t force suppliers to absorb the coming consumption tax increase, the same rules cannot be easily applied where private brands are now the norm. In the past couple of weeks, multiple companies have come out to say they will keep prices static and some will even reduce prices after 1 April in order to counter the general perception that everything in the shops is more expensive.

Kenzo signs with Yagi Tsusho
The Yen may have weakened from ¥100 to ¥140 to the Euro but enthusiasm for European brands continues unabated. Yagi Tsusho signed three brands in the last six months, including Kenzo.

Trinity Arts growth continues
Japan has a host of fast growing fashion retailers. One of the most consistent is Trinity Arts which is using the large cash pile of new parent Adastria to rapidly expand existing chains and launch new ones, including for overseas markets.

Supermarket M&A boom imminent
2014 could be a rough year for some – but problems with consumer confidence could be yet another reason pushing retailers towards greater consolidation. Last month saw what is the most significant merger in retail history between H2O Retailing and Izumiya. There have been bigger mergers financially speaking, but this is the largest between two solvent and actively competitive retailers. The news could well mean a psychological barrier to similar mergers has finally collapsed.

Direct marketing firms face pressure
Apparel e-commerce is an intensely competitive business and getting tougher. This is making life harder than ever for the main catalogue businesses, helping explain Nissen’s decision to accept the embrace of Seven & I Holdings.

Itochu signs more brands
Itochu Shoji isn’t shy about signing brands for the Japanese market, and almost monthly announces a new tie up in areas as diverse as sports and high end jewellery. Its latest deals range from designer fashions to outdoor shoes but, whatever the category, all are part of plans to greatly increase profits for the trading firm in the next few years.

NTT launches e-commerce mall
NTT Plala, the telecom giant’s internet service provider arm, has launched a smartphone e-commerce portal. Although NTT Docomo has its own mobile e-commerce services such as D Shopping, NTT Plala is offering a different take on e-commerce by creating what it calls a catalogue market, with Aeon and Tokyu Hands already on board.

Lawson enters supermarket sector
Lawson has been building up its fresh food business for the past five years, acquiring discount supermarket chain Shop 99 and turning it into Lawson 100, buying farms, and rolling out fresh foods in its convenience store business. In February it took the next step, announcing it would enter the mini-supermarket business proper, taking on Aeon and other supermarket operators directly.

Matsumotokiyoshi looking for M&A
Matsumotokiyoshi sits at the head of the drugstore sector, the biggest chain in Tokyo and one of the most aggressive retail banners of any format. It has struggled to expand into the regions, but Matsukiyo is setting aside more cash for acquisitions.

More station SCs, large and small
Railway operators continue to accumulate more share of retail sales, with a welcome impact on their bottom line. As well as upgrades to existing buildings, making stations much more attractive places to shop and dine, railway operators and partner developers like Aeon are building more station shopping centres every year with wide variation in SC size, from large malls to the tiniest metro corridor.

Daiwa House: logistics innovator
If you need logistics services for e-commerce or are looking for store construction, Daiwa House may have the solution. It is about to break ¥120 billion in sales from its logistics business, offering multi-tenant logistics facilities ideal for SMEs and especially for anyone selling online. It is also a major, if low profile, SC developer and operator with leasable space reportedly rivalling even Aeon.

Retail Data: Department store tourist sales double

News in Brief
Old Navy to open 25 stores in 2014
Fast Retailing eyeing J Crew
IKEA to double sales by 2020
Sazaby signs Raquel Allegra
Bow & Arrows: a new label from United Arrows
Jewellery market booms in 2013 but WILL slow in 2014
UK brand French Sole to open
Sogo & Seibu: new brand for senior couples
Takashimaya to open in Aeon Okayama
Laura Ashley to expand home stores
Daiei Tachikawa closes after 43 years
Beer sales booming
Mitsukoshi changes its old bags
Ito-Yokado opens first store in China for three years
Yahoo ties with Zozo, 109 and Parco on search
Daiei to close marche chain, write off DEBT
F.Clio opens Marunouchi store
Amazon invests in merchants
Heart Market buys Clean
Lula Magazine to launch in Japan
Rakuten pressured to stop scams
Urban Research Meiji Dori flagship planned

JapanConsuming Headlines: February 2014

by admin on February 6, 2014

JapanConsuming February 2014

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Focus: Consumption Tax to hit while incomes still falling
Retailers are bracing themselves for consumer reaction to the increase in Consumption Tax. Retailers may be worried, but some consumers are looking at a serious change to their spending patterns if incomes don’t increase soon. Although the last rise in 1997 caused relatively minor sales disruption in the end, it came at a time when deflation was lowering prices and incomes were high – the highest on record in fact. This time around, incomes are falling just when prices are rising, making a sudden, doubling in direct taxes a potential disaster for the average Japanese household. But the situation is already bad: in the past year there has been a 24% fall in cumulative net annual disposable income, with the average family finishing with a surplus of less than half that of 2007. The surplus will be wiped out by the tax increase.

Editorial: Full steam ahead for Spring

H2O Retailing to acquire Izumiya
H2O Retailing will acquire Izumiya in June, creating a new, top 10 retail group. An increasing spate of mergers between leading chains has been on the cards for sometime, and this is the biggest regional merger so far. As with mergers led by Arcs in Tohoku two years ago, other regional chains will rush to consolidate too.

Cross Company to launch chain targeting US and Europe
Cross Company still delivers rapid growth but it is reaching a scale that could well slow it down if it doesn’t expand beyond the current model and narrow market. It knows this, and for the last two years has been working on a plan to create a new kind of fashion chain, one that is designed for global markets and sales of ¥1 trillion, while also being ethically and ecological sourced. Can slow fashion scale that big?

JR West to takeover 60% of Isetan-Mitsukoshi’s Osaka store
Partnerships between JR operators and department stores have been successful for the most part, notably Takashimaya Nagoya, Daimaru Sapporo, and most recently Hankyu Hakata. In Osaka, JR West has been cursing its deal with Isetan-Mitsukoshi since well before the opening of their joint store at Osaka station in 2011. JR West will now take control of most of the space, creating a 50,000 sqm SC, with major retailers already queuing up.

Guess in Japan again
Guess left Japan more than eight years ago but is now back with its first store opening this month. Last time it licensed its brand to a local firm, but this time around Guess is following the market leaders with its own direct operation.

Daiei to expand discount chain
Daiei is now part of Aeon Group, and while Aeon decides what to do with its latest acquisition, the opportunity to leverage the Big A discount chain in Tokyo is an obvious first step and one that couldn’t be timed better. If all goes according to plan, store numbers will be doubled over the next couple of years, establishing a major discount food chain at the heart of the capital and putting pressure on other supermarkets and even convenience stores vying for the same market.

Both young and old lead shift to online shopping
Non-store retailing continues to grow faster than any other channel, with major retailers now developing serious online alternatives to their physical stores. Men are still the primary buyers online, and more women still prefer catalogues, but shopping by mobile or tablet is the fastest growing browsing method. Meanwhile there have been improvements in online store design and a better understanding of what consumers want from non-store retailing.

Fast Retailing the multi-national
A new listing on the Hong Kong stock exchange is part of Fast Retailing’s wider strategy to globalise its operations in a bid to get its stores into every key international market. Non-Japanese sales are certainly rising fast on the back of a rapid store roll out, but profitability remains elusive in some markets and may impinge on its appeal to those new international investors in Hong Kong.

E-money: a ¥3 trillion market growing at 20% a year
Japan’s e-wallets are arguably an old technology being used by big retailers and banks at the consumer’s expense, but the market continues to grow given the huge convenience and the lack of real alternatives. Retailers are at last beginning to data mine the information they collect and that might well benefit consumers through new products and services.

Department Store sales rise for first time in 16 years
In 2012 department store same store sales rose for the first time in 16 years, but this was partly because of a rebound from the impact of the 2011 earthquake. The uptick in overall sales this year, however, shows both the strength of premium markets at the moment, as well as a decline in store closures.

Top convenience chains expect strong 2014, 4,800 new stores
Despite worries in many parts of the retail sector, convenience stores still expect a strong year. All of the top three chains will expand store numbers at home and improve attractiveness through better ranges and marketing initiatives. They will open a record 4,800 stores this year alone.

Seven & I revamps entire promotion system, more online ads
Build a store and the customer will come. But what if the store is a virtual one online? Given its clear aim to develop Japan’s first store-to-web omnichannel, Seven & I has taken the first step by entirely reorganising its advertising and promotion strategy. It will increase the volume of online advertising 10 fold in the first year and combine media channels. It will also bring much of its promotion planning and strategy development in-house.

Retail Data: Department Stores beat overall retail growth

News in Brief
A result for Abenomics: ¥6 million chocolate
H&M Japan sales jump 46% in 2013
Lalaport Tokyo Bay gets second update with Stradivrius and Flying Tiger
ABC Mart overseas sales jump 65%
More women working, fewer permanent jobs
Hankyu Nishinomiya Gardens to get major update
Kusuri no Aoki extends online drug sales
Sazaby opens store for Frank & Eileen
Itochu signs Sanmarino for Outdoor Products
Japan to begin taxing foreign downloads in 2015
Suntory acquires Jim Beam
Matsuzakaya Ueno to reopen March 12
Familymart to unify private labels internationally
Generic electronics begin to takeoff
Retailers and restaurants gearing up for high demand
Mitsui ties with Mitsukoshi on concierge service
Locondo the store
United Arrows launches e-commerce app
Ito-Yokado opens first store in China for 3 years

JapanConsuming: Headlines January 2014

by admin on January 8, 2014

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Focus: Specialty apparel FY2012: gaining further ground
The results for specialty apparel retailing in FY2012 were even better than 2011, reflecting higher spending on premium fashions as well as a general uplift in consumer demand. The top specialty apparel retailers outperformed the market, averaging 9.1% growth and now account for 35% of the entire apparel market – the top 20 alone own 25%. Womenswear retailers grew the fastest, boosted by a cluster of up and coming middle ranking retailers like Trinity Arts and Mash Style Lab that posted sales up more than 50%.

Editorial: Unavoidable online retail

Seven & I acquisition spree in bid to be first omnichannel conglomerate
Seven & I Holdings has a problem. In FY2012, Seven Eleven still accounted for 81% of the group’s net profits. It’s not surprising then that the group’s chairman, Toshifumi Suzuki, is keen to find new alternatives. This is the main thrust to four separate acquisitions announced in December, with the long-term goal of creating the first genuine omnichannel retailer, integrating physical stores with e-commerce.

IKEA: 10 stores by 2016
IKEA has been operating in Japan since 2006, but went on a short hiatus, opening no new stores between 2008 and 2012. That has now changed. Following the opening in Fukuoka in 2012, it will now add a further four stores over the next two years – the same one or two stores a year pace that it sets in many markets, with a goal of 14 stores by 2020. Confirmed as the number two home furnishings chain in the country, the new stores should push sales to well over ¥100 billion a year.

Aeon Makuhari the leisure centre
Aeon heralds each of its new large malls as a new era of mould-breaking shopping, but often reveals something more prosaic. Makuhari Shintoshin may be the exception. While there is nothing startlingly original in the individual components that make up the SC, overall it is one of the more forward thinking developments of recent years, offering a level of entertainment and services that could ensure a consistent level of footfall well beyond people simply coming to shop.

Census: Corporate retailing takes over, 66 small stores closing every day
From the 1960s right up until 2007, METI conducted its Census of Commerce, regularly updating the world on the minutiae of the distribution sector – and making a case for protection of small, largely uncompetitive players who supported the ruling party. That motivation has now been largely overtaken by political reality and the Census has been subsumed into the Economic Census, the latest results for which were released in November.

Cookpad: making food shopping easy
Cookpad is a recipe website, but clever marketing has made it perhaps one of the world’s most successful. It was developed at just the right time and in the past few years the switch to smartphones and tablets has helped it advance even further. In December the company made a series of acquisitions, taking on a new online tutor operation as well as two companies overseas. It continues to expand its links with food brands and retailers, and to come up with new innovations to help people cook.

Start Today goes after Rakuten
Start Today has launched a new market place offering SMEs in the apparel and fashion world access to its large base of fashion consumers. It may well threaten the fashion merchant business at Rakuten and Yahoo but the move is also part of a much bigger story about who will win in e-commerce: general merchandise portals or specialty sites.

Urban Research and H&M open on LINE, LINE Mall also launches
As LINE continues to expand its user base, it is also capturing more corporate customers. As with Facebook and Twitter, LINE makes it easy for brands and retailers to engage directly with consumers, sending out information on special offers, events and new stores. LINE itself is now developing its own e-commerce revenues.

Food distribution consolidates further as tax rise pressures margins
Wholesalers are worried. Most already work on minuscule profit margins and they now face a new, powerful retail clientele more than capable of insisting that suppliers absorb part of the 3% consumption tax hike coming in April. The result is a rush to add scale, both in market share and logistics capability. Analysts expect a corresponding rush in wholesale M&As in the next 12 months.

US payment services target Japan as more Japanese buy from overseas
Paypal and Square are gaining traction in the Japanese market, potentially disrupting the cozy world of credit card processing with its fat fees and oligopolistic practices – even though Square itself is backed by one of Japan’s biggest card processors. Already Square’s entry into the market has forced Paypal to lower its fees. Paypal is proving popular not just for sales in Japan but also for the growing enthusiasm for buying direct from overseas.

Retail Data: Tourist sales up 122%

IN BRIEF
E-commerce sales to hit ¥21 trillion in 2018
Aeon to open 155,000 sqm SC in Wakayama, Takashimaya to close
@cosme hits 8 million monthly visitors and 11 million reviews
Hit Union acquires British firm, plans multi-brand strategy
Tamagawa Takashimaya update starting next month
Prada opens first Church’s flagship in Japan
Sonia by Sonia Rykiel launches in Japan
Seria sales rise 9%
Mitsui to open first outlet mall in Hokuriku
Isetan-Mitsukoshi to open popup store in New York
Shin Osaka station gets new shopping zone
Isetan-Mitsukoshi to launch new catalogues for seniors
Sports apparel market up 2.5%
Tablet use soaring
Lumine to open pop up store in Yokohama
Seiji Tsutsumi passes away
Radishbo-ya website renewal
Rakuten upset by new rules for online drug sales
Dreamy expanding customer base
Takarajimasha to launch new fashion mags in 2014
Ario Ichihara opens
Retailers and restaurants gearing up for high demand
Locondo tries its first physical store
Aeon Mall opens SC in Vietnam

JapanConsuming Headlines: December 2013

by admin on December 5, 2013

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Focus: Solid growth for SCs as new build rate rises again Shopping centres had a solid year in 2012 with the top 100 seeing sales rise 2.2% thanks to higher spending on fashions, food and lifestyle goods. The largest SCs are growing much quicker than the sector as a whole, which was up only 0.5% after a 1.3% fall in 2011. The leading developers continue to grab more market share through investment in new malls, as well as upgrading existing facilities to hammer nearby competitors. Although Aeon doesn’t report sales for its SCs, the JR firms, Mitsui and Mitsubishi now account for over 50% of the sales of the top 100 SCs alone.

Editorial: Retailers expect an amazing Xmas

Uniqlo: the only road is overseas Uniqlo has reached saturation in Japan and is now focusing almost all its investment overseas. At home it’s a case of consolidation, scrapping ageing road side stores in favour of new SC and city centre locations, as well as making further efforts to diversify and widen its range, including fashion, to drive more repeat business.

Cheap rice: food security dismantled A four decade old policy to protect rice prices, ostensibly to ensure food security, but just as much to appease the LDP’s many farming supporters, is about to be dismantled. The news is significant. It comes as a huge shock to farmers, but could bring welcome relief to long suffering consumers.

Shoe retailing consolidates as ABC Mart sales jump 21.7% Footwear is probably the most rapidly consolidating product sector in Japanese retailing today. ABC Mart is by far the strongest chain and continues to surge forward, leaving long-time leader Chiyoda struggling to maintain ground. Meanwhile Aeon has largely completed restructuring of its own footwear interests under the single umbrella of G-Foot and has hopes to squeeze Chiyoda further over the next 12 months.

A brick wall: selling suits Aoyama will launch a womenswear chain next year, Konaka has franchised a fashion chain from World, and Aoki is doing more karaoke than ever; all are efforts to shake off the doldrums of the suit market, suffering from a contracting and ageing population and a surfeit of younger men happy in just a casual jacket. The good news though is that both men and women are spending more when they do get formal.

Pal: a new ¥100 billion fashion retailer with a homeware slant Pal is radically different from other fast growing fashion and lifestyle retailers like United Arrows and Point. While its peers garner most of their sales from two or three key chains, Pal is a thoroughly and deliberately diversified retail group, including a strong homeware buisness. This approach has delivered solid results, but it is now embarking on a new stage of investment in large format stores, seeing a market for what it calls an ‘IKEA of fashion’.

Fancy.com launches in Japan There are already numerous social shopping sites in Japan, especially in fashion, but nothing quite like US hit service, Fancy.com, which launched in Japan last month. As well as solid investment partners, Fancy.com has also snagged Isetan as its first corporate sponsor and retail partner, including a showcase within Isetan Shinjuku itself. Quite a good start for a three year old business.

Aeon’s omnichannel marketing for SCs As this month’s focus shows (see Page 12), shopping centres now account for 20% of Japanese retail sales. The biggest competitive threat comes from e-commerce, and developers are looking for ways to both counter this threat as well as embrace the new technologies. Aeon will launch a new O2O marketing scheme when it opens its much heralded new SC this month, Makuhari Shintoshin.

Department Stores: an elderly niche The debate about the viability of department stores continues to rage. The past 12 months have been kind to the format and three chains, Isetan-Mitsukoshi, J Front and Sogo Seibu, are showing signs of innovating their way towards a secure future. On the other hand, too many stores remain drab, over staffed and randomly merchandised – mostly due to on-going control of sales space by suppliers. However, there is one consumer group that will continue to shop at department stores until they drop: the over 70s.

Komeri to expand into Hokkaido Komeri is the country’s third largest home centre chain with a wide range of store formats and more than 1,130 stores, operating in every prefecture except Hokkaido and Okinawa. From next year it will enter Hokkaido properly for the first time with plans to rapidly expand store numbers. Given its volume, Komeri is a major client for all kinds of homewares, interior, farm and DIY products from overseas.

Online grocery sales booming Online sales of grocery items, particularly food, are booming in Japan and there’s still plenty of growth left in the sector. All the major food and FMCG retailers, as well as a lot of the regional players, offer online ordering and direct to door delivery. There are also a few prominent online-only players, and the traditional retail Coops are also big contributors. Consumers are increasingly open to having food delivered to their door and various factors suggest that, in future, more and more people won’t bother even visiting a supermarket at all.

Omnichannel retailing comes to department stores and station SCs One of the problems department stores and shopping buildings face when trying to exploit e-commerce is that they do not, in general, take title to merchandise, leaving that to tenants. Lack of fulfilment skills and infrastructure, and limited information on tenant stock levels makes an online sales channel difficult. To fix this some companies are collaborating with tenants on new ways to create a more seamless shopping experience off and online.

Retail Data: Department store sales fall 0.6%

News in Brief Seven & I Holdings to acquire Nissen Laso: supplying from overseas select shops Rakuten 2013 ranking reveals health & beauty demand Line hits 300m users, targets 500m Lion to help poorly pets Aeon: a ¥20.14 million BAG Odakyu plans NEW SC AT Shimo Kitazawa station Russian cosmetics brand comes to Japan Izumi planning 30 store expansion, new format 90% of housewives expect to cut back Loro Piana in Ginza Sumikin Bussan invests in Radley London subsidiary Bonuses up, but not by much World opens Free People flagship Kojima launches on Amazon United Arrows tries fix for Coen chain Onitsuka Tiger to get 50 stores Kanematsu signs Yakpak as trading firms grab bag brands Aeon launches fashion specialty store Bag and apparel markets up, prices rising Tourist numbers jump 30% Isetan-Mitsukoshi profit jumps 55%

JapanConsuming Headlines: November 2013

November 11, 2013

Click here to Subscribe Now Convenience stores: new models in fight to the finish The convenience store sector is without doubt the most successful in the Japanese retail industry. The leading chains, Seven Eleven, Lawson and Familymart, are also some of the best performing retailers in the world and responsible for a good proportion of […]

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JapanConsuming Headlines: October 2013

October 7, 2013

Click here to Subscribe Now Focus: Apparel Retailing FY2012: leading from the top Apparel sales rose 0.4% in FY2012 but the top 100 averaged growth of 5.2%, a strong result, helping the top 100 garner more than 60% share of the apparel market. Specialty chains continued to deliver most of the growth, but e-commerce businesses […]

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JapanConsuming Headlines: September 2013

September 4, 2013

Click here to Subscribe Now Focus: Department Stores: short-term success or long-term paradigm shift? Includes data on: Top 30 Department Store Firms Top 50 Department Store Branches Top 30 Stores by Apparel Sales Top 30 Stores by Accessory Sales Same store sales at department stores rose for the first time in 16 years in 2012. […]

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JapanConsuming Headlines: July/August 2013

July 7, 2013

Click here to Subscribe Now Retail Results 2012: from growth to consolidation FY2012 results are finally in for Japan’s top retailers. It was yet another good year for the majority of firms, with the growing trend of market consolidation increasingly clear. With the exception of consumer electronics retailers, most retailers have very little to complain […]

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JapanConsuming Headlines, June 2013

June 5, 2013

Click here to Subscribe Now Focus: Will Aeon cause an M&A avalanche? Market share concentration in distribution has been growing in Japan for the past decade. Mergers and acquisitions have always been an important strategy in the sector as a means to grab more share quickly, very often at relatively low cost. Until recently, the […]

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