July-August 2024 issue

Sogo Seibu: making Seibu Ikebukuro relevant again

Now under new management, Sogo Seibu is working on plans to rework each of its buildings to get the best out of each location and bring back entertainment and excitement to the ailing format. In the case of Seibu Ikebukuro concrete plans are beginning to emerge – but will it be able to turn a decent profit?

Editorial: All things foreign flocking to Japan

Zozo expecting new highs

Zozo continues to post solid gains in sales but a slight dip in new customers has led some to suggest that the online fashion mall is reaching its peak. While further growth may be harder to achieve, Zozo has several strategies in place that should help it reach its target of ¥800 billion.

Lowya expanding omnichannel

Lowya began as an online furniture retailer and is still one of the largest in the online space, but limited brand awareness has held it back and sales fell last year. Vega Corporation, Lowya’s parent, is now expanding physical stores and offering omnichannel solutions to fix the problem.

Gift Market: for love not obligation

Japan has always had a thriving gift market and department stores benefitted the most from traditional, obligatory gift seasons. Obligatory gift giving has been in decline for some time, with new, value-added product lines the only small area of growth. Meanwhile, social gifts are becoming increasingly popular.

More Korean brands in Japan

Japanese demand for Korean fashion and cosmetics brands continues unabated, leading to more direct investment from the peninsula as well as distribution deals.

Tokyo’s ¥100 million homes a sign of changing consumer market 

Average prices of apartments in central Tokyo exceeded ¥100 million for the first time last year, smashing the previous record set back in 1990 at the end of the bubble economy. The trend is being driven by high demand for luxury units, backed by both domestic and foreign investors looking for apartments that will yield long-term capital gains, but the higher prices could well impact consumer discretionary spending while increasing the spending power of HNWIs.

Asics and Mizuno surge continues

Japanese sports brands continue to outperform. Asics and Mizuno have both benefited from improved branding, new models, and more disciplined supply chains. The weak Yen hasn’t hurt either, boosting overseas sales values.

Ito-Yokado hopes branded deli will boost recovery

Deli foods already account for 20% of all food sales in Japan but are growing fast as busier consumers demand more convenience. Most food chains only offer generic items, with ingredients the main distinguishing factor so, last month, Ito-Yokado began sales of a new, branded range called York Deli, aiming to differentiate its line up from competitors. Exclusive ranges will be a key factor as it shifts towards a focus on food.

New records for Donki

Inflation is encouraging customers to seek out discount chains, led by PPI’s Don Quijote. Backed by expansion of private brand lines and more food lines, as well as higher sales to tourists, PPI posted record results for 3Q2023 to March, with high expectations for further growth at home and abroad.

Isetan-Mitsukoshi bets on flagships and real estate

Isetan Shinjuku expects to post sales in excess of ¥400 billion this year, a record for a single retail store, although most of the growth is from inbound tourists. But Isetan-Mitsukoshi is working to ensure longer term stability through more sophisticated databases and personalised marketing. At the same time, it will make better use of real estate assets, investing ¥500 billion around Isetan Shinjuku alone.

Shinsaibashi Osaka booming

Recent footfall data from CBRE confirmed a full recovery for the Shinsaibashi shopping area. During Covid, the Osaka street saw a much larger drop in custom compared to Ginza for example, but this year it roared back to life with foot traffic above 2019 levels.

Ain: fighting activist funds

Ain is under pressure from Oasis Management to improve its board and the sector is waiting to see whether Ain, like Tsuruha, will choose to join with other local partners to fend off activists.

FOCUS

Retail sector sets new record high in FY2023-24

FY2023-24 marked a clear return to normal and improved results for almost all major retailers. Retailing is booming, backed by consumers getting out and about, buying enthusiastically and enjoying Japan’s shop-focused entertainment centres once again. Tourists, with more than a little encouragement from a weak Yen, are back in record numbers, with 3 million a month entering Japan since March and well over 30 million expected in 2024 overall. Inflation remains a significant concern for retailers selling essentials, but we’re two years into this current round of price increases and there are signs that consumers are becoming resigned to higher prices. FY2024-25 looks like being another excellent year for most.

Retail Data: City dept. stores up 20% on 2% rise in footfall

IN BRIEF

Itochu signs Fruit of the Loom and FPM

Sanyo Shokai to cancel The Scotch House

Square payment systems expanding

Teijin Frontier signs Save the Duck

Fope opens first flagship store

More development in Yokohama

Beams sets up shop in VR world

Supermarket musical chairs

Jade Group opens sneaker store

Aeon offering e-receipts at 4,000 stores

New Hiroshima station mall in 2025

Mitsui absorbs Bigi

Shopping malls up 3.9%

Look signs British brand Smythson

JR East and Japan Post launch collaborations

Brooks Brothers licensee targeted by activists

Pet market reaches ¥1.5 trillion

Lower sales for Belluna and Scroll

Snow Peak delists and builds more upscale campsites

Coops sell ¥530 billion online in 2023

Cainz: real stores over e-commerce

Brands and companies in this issue

Adastria, 1, 14, 19, 21
Aeon, 5, 7–8, 13, 20–22
Amazon, 5, 7, 24
Aoyama Shoji, 22–24
Arclands, 21
Askul, 1, 20
Authentic Brands, 11
Axial Retailing, 21
Beisia, 7, 20–21
Berkshire Hathaway, 3
Bic Camera, 3, 19–24
Bigi, 9
Brooks Brothers, 2, 10–11
Cainz, 13, 18, 20, 22–24
Clio Cosmetics, 7
Coop Kobe, 13
Coop Sapporo, 13
Coronet, 9
Cosmos Yakuhin, 14, 20, 22–24
Coversomeone, 7
Daidoh Limited, 10
Daiei, 21
Daimaru Matsuzakaya, 19
Daiso Sangyo, 19–20
Don Quijote, 2, 7, 11, 17, 19–20, 22–23
Doowon, 7
Ebay Japan, 5
Edion, 20
Familymart, 20–22
Fast Retailing, 14, 19–22
Florasis, 7
Fope, 5
Fortress Investment, 1
FPM, 3
Fuji Supermarkets, 7, 19
Giftee, 6
Hankyu Hanshin, 20, 22–24
Heiwado, 20–21
Inageya, 19, 21
Isetan, 1, 11–12, 19–21
Isetan Mitsukoshi, 20–21
Itochu Shoji, 3, 7, 9
ItoYokado, 7, 13
Izumi, 20
Jade Group, 8
Japan Post, 10
Japanese Retail, 15
John Smedley, 9
Kansai Food, 21–24
Keikyu, 6
Kintetsu, 13, 18
Kobe Bussan, 14, 17, 20, 23
Kohnan Shoji, 20, 22–24
Kojima, 19, 21–24
Lawson, 19–22
Life Corp, 20, 22–24
Like Belluna, 12
Locondo, 8
Lopia, 14, 17, 19, 21–23
Lowya, 1, 5
Lumine Ikebukuro, 25
Maison Kitsune, 7
Majica, 11
Mardi Mercredi, 7
Martin Kim, 7
Mash Holdings, 3
Matsukiyo Cocokara, 19–24
Matsuzakaya Kintetsu, 22–24
Mihara Yasuhiro, 8
Ministop, 21–24
Mitsubishi Estate, 6
Mitsui Bussan, 9
Mitsukoshi, 1, 11–12, 19–24
Muji, 1, 18, 22–23
Nitori, 1, 18, 20–22
Nojima, 19–20, 23
Nugu, 7
Oasis Management, 2, 13
OIC, 21–24
Onward Kashiyama, 10
Paul Stuart, 4
Peace Deli, 10
Pexco Shop, 7
Qoo10, 4–5
Rakuten, 5, 24
Reebok, 8
Sanyo Shokai, 3–4
Scotch House, 4
Seijo Ishii, 8
Seven Eleven, 7, 10, 20, 22–24
Shimamura, 1, 14, 20, 24
Shu Uemura, 4
Smythson, 9
Snow Peak, 12
Sogo Seibu, 1, 3, 19, 21–24
Sotetsu Railways, 6
Sugi, 20
Sundrug, 20, 23
Takashimaya, 1, 3, 7, 12, 20–21
Teijin Frontier, 5
Trial Holdings, 17
Tsuruha, 1, 13, 19–20, 22–24
Uniqlo, 1, 20, 22, 24
Vega Corp, 5
Welcia, 14, 19–20, 22–24
Yodobashi Camera, 1, 3, 20, 22–24
Zozo, 1, 3–5