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>Life opened a new, upscale supermarket last month in central Tokyo that is designed to process online orders as easily as serving in-store customers.</li>
<li>The new store, replacing Mitsukoshi in Ebisu Garden Place, includes a backroom that acts as a dark store for online orders.</li>
<li>This frees up space in the store for higher margin items like deli foods and is a sign of the supermarket's intentions going forward.</li>
</ul>


Life opened a new, upscale supermarket last month in central Tokyo that is designed to process online orders as easily as serving in-store customers.
The new store, replacing Mitsukoshi in Ebisu Garden Place, includes a backroom that acts as a dark store for online orders.
This frees up space in the store for higher margin items like deli foods and is a sign of the supermarket's intentions going forward.


Life Opens Supermarket 4.0: A Hybrid Online-Offline Store

Thematic (Sector/Industry)

<ul>
<li>OniGo only opened its first dark store in the middle of last year and along with competitors is expanding rapidly.</li>
<li>But it also recently signed up to deliver orders from Lawson Store 100 and is running a trial from Comfort Market, Seven &amp; I’s concept store in Setagaya.  </li>
<li>In both cases, online orders are picked, not by store staff, but by OniGo’s own staff, to increase the speed of order preparation and to tie to store’s inventory systems.</li>
</ul>


OniGo only opened its first dark store in the middle of last year and along with competitors is expanding rapidly.
But it also recently signed up to deliver orders from Lawson Store 100 and is running a trial from Comfort Market, Seven &amp; I’s concept store in Setagaya.  
In both cases, online orders are picked, not by store staff, but by OniGo’s own staff, to increase the speed of order preparation and to tie to store’s inventory systems.


Dark Store Delivery in Japan Takes Off – Collaborating with Retailers

<ul>
<li>Half-Year results are coming in for the largest retailers showing that fundamentals are more important than ever. Aeon demonstrated improvements after a tough 2020.</li>
<li>Seven &amp; I reported a jump in revenues, thanks to its recent acquisition in the USA. The group may consider finally selling less successful parts of its business at home.</li>
<li>Life, the largest supermarket, recorded flat revenues but is planning a big investment in stores and systems in preparation for anticipated changes to shopping behaviour.</li>
</ul>


Half-Year results are coming in for the largest retailers showing that fundamentals are more important than ever. Aeon demonstrated improvements after a tough 2020.
Seven &amp; I reported a jump in revenues, thanks to its recent acquisition in the USA. The group may consider finally selling less successful parts of its business at home.
Life, the largest supermarket, recorded flat revenues but is planning a big investment in stores and systems in preparation for anticipated changes to shopping behaviour.


Ups and Downs in Japanese Big Retail a Year After Covid Hit

Ryohin Keikaku’s <a href="https://www.smartkarma.com/insights/muji-a-3-trillion-brand-by-2030" target="_blank" rel="noopener">announcement last month that it is aiming to be a ¥3 trillion company by 2030</a> is being quickly backed up with new stores and refits of existing ones. Food will be a core part of the reinvented Muji business, with sales of ¥900 billion if the company meets its goals. The plan is to work with existing supermarkets to create formats that sell FMCG in a new and exciting way. The latest opened in Saitama last month and 70% of new stores will be supermarkets going forward.

Ryohin Keikaku’s announcement last month that it is aiming to be a ¥3 trillion company by 2030 is being quickly backed up with new stores and refits of existing ones. Food will be a core part of the reinvented Muji business, with sales of ¥900 billion if the company meets its goals. The plan is to work with existing supermarkets to create formats that sell FMCG in a new and exciting way. The latest opened in Saitama last month and 70% of new stores will be supermarkets going forward.

70% of New Muji Stores to Be Supermarkets

Event-Driven

<a href="https://www.smartkarma.com/entities/h2o-retailing-corp" target="_blank" data-smartkarma-citation="entities:17562:1" rel="noopener">H2 O Retailing (8242 JP)</a>, the biggest retail group in Kansai, announced in late August that it would expand its share in <a href="https://www.smartkarma.com/entities/kansai-super-market-ltd" target="_blank" data-smartkarma-citation="entities:15519:1" rel="noopener">Kansai Super Market (9919 JP)</a> to take a majority stake. As is usual, the announcement was made with full understanding and acceptance by Kansai Supermarket’s board and CEO, but things have not gone according to plan. We now face another situation where existing shareholders object to a cosy, pre-agreed takeover. In this case, the company objecting is OK Super, the perennially successful Tokyo-based discount supermarket.OK Super would, in our opinion, offer the best growth longer term given its operational excellence, low price positioning and massive pent-up Japanese consumer demand for lower prices. Last year, OK Super broke ¥508 billion in sales for the first time, making it a top four chain, and achieved operating profits of ¥37.8 billion. In contrast, Kansai Super sales were ¥130.9 billion, with operating profits of ¥2.7 billion.Whereas Kansai Super largely represents past supermarket success, OK is the present and future and the prospect of OK entering the Kansai market would represent a serious threat to existing chains, not least H2O’s own.

H2 O Retailing (8242 JP), the biggest retail group in Kansai, announced in late August that it would expand its share in Kansai Super Market (9919 JP) to take a majority stake. As is usual, the announcement was made with full understanding and acceptance by Kansai Supermarket’s board and CEO, but things have not gone according to plan. We now face another situation where existing shareholders object to a cosy, pre-agreed takeover. In this case, the company objecting is OK Super, the perennially successful Tokyo-based discount supermarket.OK Super would, in our opinion, offer the best growth longer term given its operational excellence, low price positioning and massive pent-up Japanese consumer demand for lower prices. Last year, OK Super broke ¥508 billion in sales for the first time, making it a top four chain, and achieved operating profits of ¥37.8 billion. In contrast, Kansai Super sales were ¥130.9 billion, with operating profits of ¥2.7 billion.Whereas Kansai Super largely represents past supermarket success, OK is the present and future and the prospect of OK entering the Kansai market would represent a serious threat to existing chains, not least H2O’s own.

H2O Retailing and OK Super: Which Is the Better Owner of Kansai Supermarket?

Japan

LIFE CORPORATION operates a supermarket chain mainly in Kansai and Kanto areas. The Company sells mainly groceries, and also clothing, and household utensils.

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Life Corp (8194 JP)

Life Opens Supermarket 4.0: A Hybrid Online-Offline Store

Integration of online with offline stores in Japan's supermarket sector has been slow in coming. Life Corp has just introduced a new format that...

Michael Causton

Dark Store Delivery in Japan Takes Off – Collaborating with Retailers

Dark stores are taking off, set up by delivery firms to ship food and basic daily use products. Some are competing with retailers but others are...

Michael Causton

Ups and Downs in Japanese Big Retail a Year After Covid Hit

Big retail in Japan showed improving results in 1H2021 as both Aeon and Seven & I boosted revenues although for very different reasons. Both remain...

Michael Causton

70% of New Muji Stores to Be Supermarkets

Ryohin Keikaku has been on a roll in Japan but there are signs of saturation and increased competition in the core household and clothing markets....

Michael Causton

H2O Retailing and OK Super: Which Is the Better Owner of Kansai Supermarket?

Kansai Super is the prize in a bidding war between H2O Retailing and OK Super. While the former would use Kansai to consolidate market share, a...

Michael Causton

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