June 4 2020

The future for Japanese retailing

Highlights from JapanConsuming monthly report

News and Analysis on Japanese retailing and consumers

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June 2020 Issue

Department Stores: sector with most to lose is hit hardest

Some department stores have improved in the past 20 years and, in the past five, the big players have poured investment into more modernisation. This has brought some success to the top firms, especially from wealthy consumers, but no one could have seen the virus crisis coming. With shoppers staying away, department stores are suddenly the most vulnerable sector of all. A major cull of stores was already expected, but those cuts are now likely to go much deeper.

Editorial: A better life through retail

Oisix Ra Daichi: the fastest online grocery shopping

Oisix is Japan’s leading online food seller and has seen demand surge with the current health crisis. So much so that in late April it temporarily stopped accepting new member registrations. It now faces the prospect of even greater demand and the need to balance this with limited supply capacity. It has an opportunity to expand, but faces the threat of upsetting existing, loyal customers if things go wrong.

Cath Kidston Japan closes down

Cath Kidston built a chain of 44 stores in Japan as well as a strong online following but, following the troubles at home and in Japan, the entire business has been closed.

Itochu invests in Noin to further cosmetics ambitions

Itochu Shoji is a powerbroker in both the food and fashion markets through its multifarious investments and subsidiaries in both wholesale and retail. It now wants to do in cosmetics what it did in fashion, building a major share of the market through multiple brands and platforms, particularly online.

90% of listed apparel firms down but e-commerce powers ahead

Many apparel firms and retailers suffered plummeting sales in March and expect a further wrenching in April. The only good news is that many saw online sales surge as consumers switched to mobile purchases. While this wasn’t enough to offset lost sales in stores, it will catalyse the shift to online.

Nitori optimistic in the crisis

Nitori is one of Japan’s best retailers and hopes to do relatively well in the crisis. It is maintaining an optimistic outlook for its existing stores over the next 12 months, but will also continue to grow its e-commerce lines, overseas stores, and expand its new apparel chain. It will also look for real estate bargains and space in struggling large stores to take advantage of the downturn.

Surge in contact-less deliveries

Demand for home delivery is surging and with it comes the need for more rapid implementation of ideas to improve delivery standards. Amazon, Rakuten and others have been experimenting with dropping packages off without signatures over the past year, but this has suddenly shifted from a helpful way of reducing redelivery costs to an essential way to deliver all packages.

Big apparel in trouble: Onward to close 1,400 stores

Led by Onward, the big apparel firms are slashing stores, investing in online and cutting staff and expensive head offices. Much of which sounds negative but they also see the current crisis as an opportunity to buy in growth by acquiring promising brands and retailers on the cheap.

Inbound traffic down 93% in March but arrivals spend and spend

Inevitably, inbound tourist numbers plummeted in March which meant that spending overall also collapsed. The good news, though, is that those who did brave travel made the most of it and spent lavishly.

Seven & I failing online

In 2015 Seven & I launched an ambitious strategy to transform the group into an omnichannel retailer. It hasn’t worked out. A change of senior leadership caused a major rethink and a pause in investment, and some of the early ideas were perhaps premature, but this failure is now a big problem for the second largest conglomerate.

Zozo rises 6.6% in 2019, plans for expansion at home and overseas

Zozo has had a rough ride recently, with faltering sales growth, lower profits, the sudden exit of its founder and confusion around its takeover by Z Holdings. Both Zozo and ZHD are hopeful that with more stability, Zozo will be able to expand again through greater cross-category sales, brands of more varied positioning – and new types of customer for them – as well as growth overseas. But will it launch another private brand too?

After Covid Take 1: the future for retailing is actually quite positive

No one really knows what will happen after the initial shock of the coronavirus fades away. Many observers, expert and otherwise, are already predicting a completely new world in one way or another, but the reality is likely more prosaic. It may take a long time, probably years, to recover to where we were in November 2019, just five months ago, but only the most pessimistic would deny that recovery will certainly happen. Will the threat of such rapid contagion and its possibly fatal consequences change the way commerce runs? In some ways the answer will be, ‘Yes.’ In Japan at least, the most likely effect is that the crisis will form a catalyst to a period of change already long predicted to be one of the most dramatic and far-reaching seen so far in retail.

Retail Data: Stay-at-home order hitting sales hard


Rakuten ties with Shopify

JINS signs Bose for sunglasses

Amazon begins sales of private label clothing in Japan

Monokabu revamps as sales surge

METI to payout ¥200 billion in Consumption Tax rebate points

Baroque’s sales fall, plans RFID on all product this year

Supermarket sales strong, but convenience stores worse result in 10 years

Facy cancels commissions to help brands

Childrenswear brand, Devirock, up 50%

Sacra opens first store

Adidas Japan launches mobile app

Marui reduces tenant rents by 10-15% in March

Baycrews creates re-use concept store

Flymee to add 3D modelling to online interiors store

Parco ties with culture club for teens

Part-time workers first to lose work

USMH targeting 7% sales growth in two years

Tsuruha rewards employees for work during virus crisis

Orbis launches online beauty consulting

FANCL offers store staff compensation and e-learning

Adastria profits surge 79% but it may need them this year

Record 1.6 Million foreign workers in Japan in 2019

Kasumi opens new unmanned store concept


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