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. 

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

Equity Bottom-Up

<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.


<ul>
<li>Lowya is an online furniture brand run by Vega Corp that hit the headlines with 42% growth in 2020 while most other lifestyle retailers were reeling from the pandemic. </li>
<li>Sales fell last year post-Covid and won't grow much this year either but Lowya wants to become a ¥60 billion business and looks a good bet for the long-term.</li>
<li>Lowya will shift to a mall model similar to Zozo which should allow it to grow faster, while tie-ups with major retailers like Aeon should raise brand awareness fast.</li>
</ul>


Lowya is an online furniture brand run by Vega Corp that hit the headlines with 42% growth in 2020 while most other lifestyle retailers were reeling from the pandemic. 
Sales fell last year post-Covid and won't grow much this year either but Lowya wants to become a ¥60 billion business and looks a good bet for the long-term.
Lowya will shift to a mall model similar to Zozo which should allow it to grow faster, while tie-ups with major retailers like Aeon should raise brand awareness fast.


Japan

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)

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

Lowya – the Zozo of Home Decor?

Home decoration is a strong consumer category in Japan and Lowya a big name in online furniture. Tie-ups with Aeon and its own stores combined with...

Michael Causton

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