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

The convenience store sector (CVS) is Japan’s most successful retail format and one that has now enjoyed almost 50 years of growth. So the sudden and unprecedented sales declines in 2020, caused by so many people staying away from city centres during the pandemic, are an entirely new test for the sector.Temporary blips aside, this leading position is likely to endure a little longer. Even with e-commerce growing faster and likely to over take CVS as the biggest channel by 2025, CVS will take on a prominent role in the fulfilment model used by many e-commerce companies.In the CVS sector itself, Familymart's delisting and new role spearheading Itochu's retail interests will cause ructions in a sector that has reached saturation and where increased competition will force more change and differentiation.The following is an in-depth review of the state of play in Japan's convenience store sector following the absorption of <a href="https://www.smartkarma.com/entities/familymart-co-ltd" target="_blank" data-smartkarma-citation="entities:320:1" rel="noopener">FamilyMart Co Ltd (8028 JP)</a> by <a href="https://www.smartkarma.com/entities/itochu-corp" target="_blank" data-smartkarma-citation="entities:18448:1" rel="noopener">Itochu Corp (8001 JP)</a>. The review includes:<ul>
<li>Full rankings of all convenience stores including sales, stores, market share, key metrics like sales per store per day etc.</li>
<li>Analysis of the current and future prospects of the big three and the outlook for the smaller players – as much targets for the big three than anything else.</li>
<li>Details on e-commerce initiatives (or the lack of them), store coverage, diversification strategies etc.</li>
<li>Updates on the pressure points of the labour shortage and franchisee rebellions.</li>
</ul>This insight provides a complete review of the sector and a clear picture of where convenience stores are headed in the next three years.

The convenience store sector (CVS) is Japan’s most successful retail format and one that has now enjoyed almost 50 years of growth. So the sudden and unprecedented sales declines in 2020, caused by so many people staying away from city centres during the pandemic, are an entirely new test for the sector.Temporary blips aside, this leading position is likely to endure a little longer. Even with e-commerce growing faster and likely to over take CVS as the biggest channel by 2025, CVS will take on a prominent role in the fulfilment model used by many e-commerce companies.In the CVS sector itself, Familymart's delisting and new role spearheading Itochu's retail interests will cause ructions in a sector that has reached saturation and where increased competition will force more change and differentiation.The following is an in-depth review of the state of play in Japan's convenience store sector following the absorption of FamilyMart Co Ltd (8028 JP) by Itochu Corp (8001 JP). The review includes:
Full rankings of all convenience stores including sales, stores, market share, key metrics like sales per store per day etc.
Analysis of the current and future prospects of the big three and the outlook for the smaller players – as much targets for the big three than anything else.
Details on e-commerce initiatives (or the lack of them), store coverage, diversification strategies etc.
Updates on the pressure points of the labour shortage and franchisee rebellions.
This insight provides a complete review of the sector and a clear picture of where convenience stores are headed in the next three years.

Convenience Stores: Diversification and a Fight for Share as Familymart Delists

Thematic (Sector/Industry)

At least until the Covid-19 crisis hit Japan in January, the majority of retailers were gearing up to announce yet another really good year of financial results for FY2019-20.
Even with the crisis, results were generally better than for FY2018 – although there are big variations by sector.
Those differences are more or less what we’ve come to expect, with traditional formats like department stores continuing to struggle, while those formats that have adopted modern management are doing well.
The following is an in-depth review of Japan's retail sector, providing:
<ul>
<li>An overview of consumer demand and retail performance</li>
<li>Format by format reviews showing growth and profit performance across all the main formats: convenience stores, supermarkets, GMS, consumer electronics, drugstores, homecentres, department stores, apparel, home and other specialty  formats.</li>
<li>Rankings:
<ul>
<li>Market share and size by sector/format</li>
<li>By sales for all retailers with sales over ¥250 billion</li>
<li>By gross and operating margins, split by format and category.</li>
</ul>
</li>
</ul>
As this is an in-depth insight, the review is split into two parts to make it easier to read.  This is Part II which provides snapshot reviews of each format/sector. <a href="https://www.smartkarma.com/insights/the-japan-retail-review-winners-and-losers-in-japanese-retailing-part-i" target="_blank" rel="noopener">Part I, which provides a quick overview of all retailing, can be read here</a>.

At least until the Covid-19 crisis hit Japan in January, the majority of retailers were gearing up to announce yet another really good year of financial results for FY2019-20.
Even with the crisis, results were generally better than for FY2018 – although there are big variations by sector.
Those differences are more or less what we’ve come to expect, with traditional formats like department stores continuing to struggle, while those formats that have adopted modern management are doing well.
The following is an in-depth review of Japan's retail sector, providing:

An overview of consumer demand and retail performance
Format by format reviews showing growth and profit performance across all the main formats: convenience stores, supermarkets, GMS, consumer electronics, drugstores, homecentres, department stores, apparel, home and other specialty  formats.
Rankings:

Market share and size by sector/format
By sales for all retailers with sales over ¥250 billion
By gross and operating margins, split by format and category.



As this is an in-depth insight, the review is split into two parts to make it easier to read.  This is Part II which provides snapshot reviews of each format/sector. Part I, which provides a quick overview of all retailing, can be read here.

Japan Retail Review 2019-20 Part II: A Sector by Sector Review of Winners and Losers

<a href="https://www.smartkarma.com/entities/lawson-inc" target="_blank" data-smartkarma-citation="entities:1040:1" rel="noopener">Lawson Inc (2651 JP)</a>  has begun the rollout of a completely updated private brand, along with new ranges of regional gourmet foods. The move brings Lawson back into the race against Seven &amp; I's preeminent private brand, Seven Premium and adds to other new initiatives like its new partnership with Muji and Lawson Bank which should provide new sources of income and higher margins in the next two years.

Lawson Inc (2651 JP)  has begun the rollout of a completely updated private brand, along with new ranges of regional gourmet foods. The move brings Lawson back into the race against Seven &amp; I's preeminent private brand, Seven Premium and adds to other new initiatives like its new partnership with Muji and Lawson Bank which should provide new sources of income and higher margins in the next two years.

The convenience store sector is today the single largest channel in Japanese retailing. Combining both merchandise and digital services, e-commerce generates more revenues overall, but for merchandise alone, the ‘conbini’ or ‘CVS’ sector is still ¥2 trillion larger.It is also the most concentrated of any in retailing, with just three major companies and, depending on how you look at it, the most profitable. There is every chance that the dynamic nature of convenience retailing, along with its close integration with Japanese work practices and society as a whole, will provide room for further growth in the medium-term, but the current growth rate is about to slow.FY2019 marks the first reduction in new store opening plans among the top three chains for more than a decade, and investment is now shifting to existing stores and new ideas to ensure continued customer interest.

The convenience store sector is today the single largest channel in Japanese retailing. Combining both merchandise and digital services, e-commerce generates more revenues overall, but for merchandise alone, the ‘conbini’ or ‘CVS’ sector is still ¥2 trillion larger.It is also the most concentrated of any in retailing, with just three major companies and, depending on how you look at it, the most profitable. There is every chance that the dynamic nature of convenience retailing, along with its close integration with Japanese work practices and society as a whole, will provide room for further growth in the medium-term, but the current growth rate is about to slow.FY2019 marks the first reduction in new store opening plans among the top three chains for more than a decade, and investment is now shifting to existing stores and new ideas to ensure continued customer interest.

Convenience Stores: Saturation but Still Growth for Some

The consumption tax was raised from 8% to 10% at the beginning of October, five years after the government reluctantly raised it from 5% to 8%.This time around, the lower, 2 point increase, backed by experience gained in 2014 and a much more confident retail industry as a whole, should all contribute to a smoother transition for the majority.Many businesses are expecting a relatively short and shallow spending downturn in the weeks to come.

The consumption tax was raised from 8% to 10% at the beginning of October, five years after the government reluctantly raised it from 5% to 8%.This time around, the lower, 2 point increase, backed by experience gained in 2014 and a much more confident retail industry as a whole, should all contribute to a smoother transition for the majority.Many businesses are expecting a relatively short and shallow spending downturn in the weeks to come.

Japan: Higher Consumption Tax Slides Smoothly into Place

Japan

MINISTOP CO., LTD. operates convenience stores primarily in the Kanto and the Chubu areas of Japan.  The Company sells fast foods, daily dishes, processed foods, home necessities, and magazines.  Ministop is affiliated with Aeon Co., Ltd.

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Ministop Co Ltd (9946 JP)

Japan Retail Review 2019-20 Part II: A Sector by Sector Review of Winners and Losers

At least until the Covid-19 crisis hit Japan in January, the majority of retailers were gearing up to announce yet another really good year of...

Michael Causton

Lawson Relaunches Private Brand

Lawson Inc (2651 JP) has begun the rollout of a completely updated private brand, along with new ranges of regional gourmet foods. The move brings...

Michael Causton

Convenience Stores: Saturation but Still Growth for Some

The convenience store sector is today the single largest channel in Japanese retailing. Combining both merchandise and digital services, e-commerce...

Michael Causton

Japan: Higher Consumption Tax Slides Smoothly into Place

The consumption tax was raised from 8% to 10% at the beginning of October, five years after the government reluctantly raised it from 5% to 8%.This...

Michael Causton

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Convenience Stores: Diversification and a Fight for Share as Familymart Delists

If you are looking for a full in-depth review and analysis of Japan's convenience stores sector and how things will shape up now that Familymart is...

Michael Causton

Japan Retail Review 2019-20 Part II: A Sector by Sector Review of Winners and Losers

At least until the Covid-19 crisis hit Japan in January, the majority of retailers were gearing up to announce yet another really good year of...

Michael Causton

Lawson Relaunches Private Brand

Lawson Inc (2651 JP) has begun the rollout of a completely updated private brand, along with new ranges of regional gourmet foods. The move brings...

Michael Causton

Convenience Stores: Saturation but Still Growth for Some

The convenience store sector is today the single largest channel in Japanese retailing. Combining both merchandise and digital services, e-commerce...

Michael Causton

Japan: Higher Consumption Tax Slides Smoothly into Place

The consumption tax was raised from 8% to 10% at the beginning of October, five years after the government reluctantly raised it from 5% to 8%.This...

Michael Causton