July-August 2017 Highlights

Jul 06

FOCUS: The State of Play in Japanese Retailing & Consumer Markets: Retail Results for FY2016: growth in the middle
Lack of growth in retailing aside, most major retailers had another strong year in FY2016, but nothing near the clean sweep of 2015. A number of sectors fell back, partly due to stagnant ideas, particularly at some larger firms, but also due to shrinking demand in some markets. The industry as a whole is undergoing some major restructuring in terms of formats. The key features of last year were the rise of some high performing, mid-sized chains, particularly in the regions, and further concentration, with the top chains taking commanding shares, and the top 80 retailers owning nearly 50% of retailing overall.

Uny-Familymart in talks to tie with Don Quijote
Japan’s newest retail conglomerate made up of Familymart and Uny began talks with Don Quijote from 13 June, presaging close ties between the two retailers. Familymart acquired Uny partly to rescue the Nagoya-based company, but mostly to grab Circle K Sunkus. Its motivation to tie with Don Quijote is all about saving itself from running too many GMS outlets.

Editorial: The burgeoning middle

Amazon to build delivery network
Amazon is looking to build its own delivery system using individual couriers in order to reduce its reliance on the giant courier firms as the latter raise prices and reduce flexibility. Given the already large number of small courier businesses that will be glad of the extra work, this probably will not evolve into the kind of gig economy that has met with a mixed response in the West, but it will put pressure on other e-commerce rivals to do the same.

Sports retailers struggle to find growth but sports fashion surges
Sports retailers have benefited hugely from the boom in jogging, hiking, yoga, and for fashion sneakers, but have also faced tough trading in older sports categories like golf and skiing. As a result, growth has slowed, but retailers and pundits alike have high hopes for the remaining years leading up to the Tokyo Olympics.

Yagi Tsusho sets up Trussardi joint venture, expands across Asia
Yagi Tsusho is one of the more successful importer-distributors both in terms of sales but also the long-term health of its relationships with foreign brands. One reason is its increasing preference to establish joint-ventures, giving the foreign partner a stake. It has just signed Trussardi following several other new signings in the last year, and is looking for more.

Matsumotokiyoshi: Japan’s largest drugstore no more 
Matsumotokiyoshi is no longer the king of the drugstore rankings, dropping down to just third after both Welcia Holdings and Tsuruha Holdings surged ahead in FY2016, largely due to M&A and consolidation.

What people buy online
Apparel has been the biggest online shopping category in the last five years, but food has been catching up fast, and cosmetics is also growing strongly. A new survey suggests apparel is becoming less dominant as consumers diversify their online spending, but overall the amount spent is increasing, particularly among those in their 30s and 40s.

Pal goes on offensive in fashion mass market
When you are already a ¥100 billion plus business at the premium end of the fashion market, finding new sources of growth within the same segment is hard. All the main select shop retailers have struggled, and now Pal Group is facing the same problem. Its solution is to invest heavily in the mass market.

Tokyo Interior expands in Kansai
Tokyo Interior is the least home fashion oriented of the major retailers selling interiors and household goods, and isn’t the cheapest either. It faces tough competition from Nitori’s nascent premium lines, but has managed to grow to 40 stores by offering quality at reasonable prices, often opening next door to IKEA, becoming an important sales channel for overseas interiors firms.

Keio: the silver lining
Department stores have been battling to attract younger customers, but Keio celebrates its lack of appeal to the young, working instead to improve services and merchandising for seniors, and has been duly rewarded.

Mitsubishi leading Life Corp to double stores in Tokyo
Mitsubishi’s supply base is the core reason for Life Corp’s success, but, as with Lawson convenience stores, the trading house has shown excellent leadership on the marketing front. Life is now in the middle of its fifth 3-year plan since 2005 and things are looking stronger than ever, particularly in the Tokyo region where it plans to double store numbers.

IN BRIEF
Mash Holdings signs New Zealand’s Ecostore
Qoo10 online mall sees 40% growth
Gladd sales hit ¥10 billion
Getting rid of old fashion inventory
J Front boosts real estate income
@cosme buys US cosmetics site
Megane Super to become Visionary Holdings
Izumiya quits Kanto as Aeon takes over last store
Askul to see 81% drop in net profit
Xebio launches board sports store HLNA aiming for 25 stores
More than 800 bankruptcies in May
Daikokuya acquires number three secondhand brand chain
Fewer than 1 million babies a year
Wego ties with Bizcast for YouTube marketing
Nike offers delivery to convenience stores
Mitsubishi Fashion creates marketing research business
B’s International signs Incase
Former Seven & I CEO gets ¥1.9 billion payout
Lawson taking over Save On stores in Saitama
Itochu to introduce No Suit Fridays
Maruei to delist
Supermarkets down, convenience stores up
Daiei expands price discounting
IKEA adds car-sharing scheme to all stores

 

Companies and Brands Mentioned in this Issue

Adastria
Aeon
Ainz Pharmaciez
Alexandre de Paris
Alpen
Amazon
Aoyama Shoji
Arcs
Askul
Autobacs
Beisia Group
Best Denki
Bic Camera
Bio-Ral
Bitstar
Bizcast
Brand Off
Cainz
Calbee
Calorie Mate
Cawachi Yakuhin
CCC
Ciaopanic Typy
Circle K Sunkus
Colony 2139
Cosme Kitchen
Cosmos Yakuhin
Cotorica
Daiei
Daikokuya
Daimaru
Daiso Sangyo
DCM
Doit DIY
Ebay
Ecostore
Edion
Enhanlabo
Familymart
Fred Segal
Geo Holdings
Ginza Six
Giosis
Gladd
GMarket
GU
H2O Retailing
Hapycom
Helen Kaminski
Himaraya
HLNA
IKEA
Incase
Isetan
Isetan-Mitsukoshi
Ito-Yokado
Itochu Shoji
Izumi
Izumiya
J Front Retailing
Joop
Joshin Denki
Kasumi
Keio Department Store
Kinokuniya
Kintetsu
Kojima
Komehyo
Komeri
Kyowa Holdings
Kyoyasudo
Lady Yakkyoku
Laguna Moon
Lalaport
Life Corp
Lohaco
Mackintosh
Mark Styler
Marubeni
Maruei
Maruetsu
Marukai
Maruwa Transport
Mash Holdings
Matsumotokiyoshi
Matsuya
Maxvalu Kanto
Maxvalu West
Megane House
Megane Super
Mercury Duo
Ministop
Misaki Shoji
Mitsubishi Shoji
Moncler
Moonbat
Muji
Nagasakiya
Nike
Nishimatsuya Chain
Nissen
Nitori
Nojima
OK Super
Okuwa
Otsuka Kagu
Ozeki
Pal Group
Parco
Piago
Poplar
Qoo10
QSI
Rolex
Russet
Ryohin Keikaku
Save On
Seibu
Senshukai
Seria
Seven Eleven
Shimamura
Shimizu Yakuhin
Smasell
Start Today
Summit
Sundrug
SuperSports Xebio
Takiya
Three F
Tokyo Interior
Tru Trussardi Stile
Trussardi
Tsuruha Holdings
Tsutaya
Uniqlo
United Arrows
Uny-Familymart
USMH
Valor
Visionary Holdings
Walmart
Wefabrik
Wego
Welcia Holdings
Woolrich
Yagi Tsusho
Yamada Denki
Yamato Transport
Yaoko
Yellow Hat
Yodobashi Camera
YouTube

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