Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

Equity Bottom-Up

<ul>
<li>Nitori dominates in home decor and furniture but now wants to become a top 10 fashion retailer through its N+ chain targeting older women. </li>
<li>It will raise the rate of new stores to 30 a year and then to up to 100 a year as it reaches scale. </li>
<li>Will it be the Uniqlo for the middle-aged? If so it could own a chunk of a segment worth an estimated ¥2.5 trillion.</li>
</ul>


Nitori dominates in home decor and furniture but now wants to become a top 10 fashion retailer through its N+ chain targeting older women. 
It will raise the rate of new stores to 30 a year and then to up to 100 a year as it reaches scale. 
Will it be the Uniqlo for the middle-aged? If so it could own a chunk of a segment worth an estimated ¥2.5 trillion.


Nitori to Ramp up N+ Clothing Chain – ¥500 Billion in New Sales?

Thematic (Sector/Industry)

<ul>
<li>The apparel/fashion sector made a partial recovery last year but was still down on 2019. 2022 looks a lot brighter with customers now back in stores including even inbound tourists. </li>
<li>The same challenges that the sector faced before Covid remain but there is plenty of room to grow by taking share from the less innovative competitors – i.e. more consolidation.</li>
<li>The sector saw the highest fall in store numbers in its history last year, but there was more investment in creating a compelling omnichannel model suited to Japan’s particular market.</li>
</ul>


The apparel/fashion sector made a partial recovery last year but was still down on 2019. 2022 looks a lot brighter with customers now back in stores including even inbound tourists. 
The same challenges that the sector faced before Covid remain but there is plenty of room to grow by taking share from the less innovative competitors – i.e. more consolidation.
The sector saw the highest fall in store numbers in its history last year, but there was more investment in creating a compelling omnichannel model suited to Japan’s particular market.


Japan's Apparel/Fashion Sector Big Review: Momentum Builds for Full Recovery

<ul>
<li>Although spending on non-necessities withered from March 2020 onwards, some low-cost retailers of discretionary items continued to grow. </li>
<li>Workman’s mix of high cost performance and engagement with the ever more active outdoor market has, and will, support expansion, even if same-store sales growth has slowed.</li>
<li>Future category expansion will deliver higher same-store sales as well as top line growth. 1,500 stores (from 1,000) is certain but 2,000 is possible thanks to new categories like footwear.</li>
</ul>


Although spending on non-necessities withered from March 2020 onwards, some low-cost retailers of discretionary items continued to grow. 
Workman’s mix of high cost performance and engagement with the ever more active outdoor market has, and will, support expansion, even if same-store sales growth has slowed.
Future category expansion will deliver higher same-store sales as well as top line growth. 1,500 stores (from 1,000) is certain but 2,000 is possible thanks to new categories like footwear.


2023 High Conviction: Workman's Cost Performance Will Beat the Competition

Event-Driven

<ul>
<li>Seven &amp; I has at last agreed to sell the ailing Sogo Seibu chain – although not for enough to offset years of investment with little to show for it.</li>
<li>Some hope that this means the start of a house cleaning exercise to rid the group of its multiple under-performing retail assets, leaving a gleaming exemplar of rational efficiency.</li>
<li>This is unlikely, especially for the original Ito-Yokado general merchandise chain and a problem given the lack of growth potential in the group's domestic business.</li>
</ul>


Seven &amp; I has at last agreed to sell the ailing Sogo Seibu chain – although not for enough to offset years of investment with little to show for it.
Some hope that this means the start of a house cleaning exercise to rid the group of its multiple under-performing retail assets, leaving a gleaming exemplar of rational efficiency.
This is unlikely, especially for the original Ito-Yokado general merchandise chain and a problem given the lack of growth potential in the group's domestic business.


Selling Sogo Seibu Doesn't Mean Seven & I Will Sell Ito-Yokado

<ul>
<li>In search of ¥1 trillion in ‘digital-related’ sales by 2026, Aeon opened its first, built-from-scratch online-offline marketing store in Yokohama this month. </li>
<li>The new Aeon SC introduces a range of features and processes to make e-commerce a natural supplement to the store and the shopping experience.</li>
<li>Aeon has a way to go to reach its targets for e-commerce but is moving in the right direction and has a clearer direction than rival, Seven &amp; I.</li>
</ul>


In search of ¥1 trillion in ‘digital-related’ sales by 2026, Aeon opened its first, built-from-scratch online-offline marketing store in Yokohama this month. 
The new Aeon SC introduces a range of features and processes to make e-commerce a natural supplement to the store and the shopping experience.
Aeon has a way to go to reach its targets for e-commerce but is moving in the right direction and has a clearer direction than rival, Seven &amp; I.


Japan

LAWSON, INC. operates a chain of convenience stores in Japan. The Company sells a variety of products including fast food, beverages, snacks, magazines, newspapers, and sundry goods.

Seven & i Holdings Co., Ltd. is a holding company which was established through the merger of Ito-Yokado Co., Seven Eleven Japan Co., and Denny's Japan. The Company plans, manages, and operates mainly convenience stores, supermarkets, and department stores.

KOBE BUSSAN CO., LTD. is a supermarket franchise store operator which mainly deals in foods stuffs.  The Company also has direct-run stores.

Yaoko Co., Ltd. operates local supermarkets in the Saitama Prefecture. The Company handles fresh food products, daily-use sundry products, and other various goods in local area.

COSMOS Pharmaceutical Corporation operates drug stores based in Kyushu. The Company sells daily necessities such as drug medicines, foodstuffs, and alcoholic beverages.

SUGI HOLDINGS CO., LTD. operates a chain of drug stores located mainly in Aichi Prefecture.  The Company sells prescription and nonprescription medicine, cosmetics, health foods, and general merchandise.

TSURUHA HOLDINGS INC. is a holding company which manages subsidiaries that operate drug stores in Hokkaido and the Tohoku area.  The Company's product line includes drugs, cosmetics, and household utensils.

SUNDRUG CO., LTD. operates an outlet drug store chain primarily in the Tokyo area.  The Company sells mainly medicines, cosmetics, baby care products, and household utensils.  Sundrug supplies merchandise to franchise stores.  The Company also operates a real estate business.

WELCIA HOLDINGS CO.,LTD. is a holding company established through a merger of Welcia Kanto and Takada Pharmacy.  The Group mainly operates drug chain stores which sell medicines, health foods, cosmetics, nursery items and daily necessity goods.

Kusuri no Aoki Holdings Co., Ltd. operates as a holding company. The Company, through its subsidiaries, provides medicines, cosmetics, health foods, beauty care, and household products. Kusuri no Aoki Holdings serves customers in Japan.

Casey's General Stores, Inc. operates convenience stores in the Midwest.  The Company's stores, operating under the name Casey's General Store, carry a selection of food, beverages, tobacco products, health and beauty aids, automotive products, and other non-food items, as well as sells gasoline.

CP ALL PCL operates convenience store chains in Thailand and China.  The Company also owns and operates the a department store chain located primarily in Shanghai city and Chonqing city of China.

Jeronimo Martins, SGPS, S.A. is a holding company. The Company, through subsidiaries, distributes food in Portugal, Poland and Colombia. The Company operates supermarkets and cash and carry stores in Portugal as well as retail stores in Poland and Colombia. Jeronimo Martins also manufactures various food products as well as provides services to the restaurant industry.

Carrefour SA operates chains of supermarkets, hypermarkets, discount, cash and carry, and frozen food stores in Europe, the Americas, and Asia.

BIM Birlesik Magazalar A.S. operates food and basic consumer goods discount stores in Turkey.  The Company provides an assortment of private label products.

George Weston Limited operates as a super market. The Company processes and distributes food and pharmacy products to grocer wholesalers, warehouses, and independent accounts, as well as provides real estate services. George Weston serves customers in Canada.

Metro Inc. distributes food and pharmaceutical products. The Company operates a network of food stores and drug stores in the provinces of Quebec and Ontario.

BJ's Wholesale Club Holdings, Inc. operates as a warehouse club. The Company delivers electronics, furniture, fitness, video games, health, toys, home decor, computers, landscaping, jewelry, and grocery products. BJ's Wholesale Club Holdings serves customers in the United States.

Coles Group Limited owns and operates a chain of supermarkets and department stores. The Company offers apparels, liquor, office supplies, groceries, and household products. Coles Group serves customers throughout Australia and New Zealand.

US Foods Holding Corp. operates as a holding company. The Company, through its subsidiaries, provides catering services. US Foods Holding serves healthcare, hospitality, educational, government facilities, and other sectors in the United States.

AEON CO., LTD. operates general merchandise stores, supermarkets, and convenience stores throughout Japan. The Company is also engaged in women's and casual clothing store business, development business of commercial property, and financing service through the subsidiaries.

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Aeon Co Ltd (8267 JP)

Nitori to Ramp up N+ Clothing Chain – ¥500 Billion in New Sales?

Nitori has been underestimated before and now apparel retailers believe Nitori doesn't have the experience to take them on. They are wrong. It...

Michael Causton

Japan's Apparel/Fashion Sector Big Review: Momentum Builds for Full Recovery

Japan's fashion and apparel sector was severely hit by the pandemic and the loss of tourism. With wallets full, Japanese are now spending again...

Michael Causton

2023 High Conviction: Workman's Cost Performance Will Beat the Competition

Some analysts have dismissed Workman as past its peak because S-S sales have fallen. This is a mistake: top line expansion and income growth will...

Michael Causton

Selling Sogo Seibu Doesn't Mean Seven & I Will Sell Ito-Yokado

Seven & I will be better off now that it has sold off Sogo Seibu (which will be in much better hands) but this doesn't mean it will offload other...

Michael Causton

Aeon: Making Omnichannel a Reality

Between Aeon and Seven & I, Aeon is clearly way ahead on e-commerce development and integration. Its latest store has e-commerce and digital...

Michael Causton

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