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 long awaited lifting of restrictions on inbound tourists in October seems to have given new confidence to domestic tourists too.</li>
<li>Major airlines, hotels and railways are all reporting a significant uplift in bookings with several forecasting that figures will exceed 2019 by March next year.</li>
<li>Retailers have benefitted too, notably department stores and lifestyle retailers. Now all Japan needs is for Chinese tourists to be allowed out.</li>
</ul>


The long awaited lifting of restrictions on inbound tourists in October seems to have given new confidence to domestic tourists too.
Major airlines, hotels and railways are all reporting a significant uplift in bookings with several forecasting that figures will exceed 2019 by March next year.
Retailers have benefitted too, notably department stores and lifestyle retailers. Now all Japan needs is for Chinese tourists to be allowed out.


Japan's Retailers, Hotels, Carriers Rejoice: Domestic Tourism Surges and Inbound Traffic Rises

<ul>
<li>Department stores managed a partial rebound in 2021-22 but remain around 19% behind pre-Covid levels overall. As a result, profits remain elusive and the shake up in the industry continues. </li>
<li>On the plus side, luxury sales continue to surge and management is now more engaged than for years.</li>
<li>Although we remain negative on the sector overall, some companies will bounce back strongly as detailed in this in-depth review of the sector.</li>
</ul>


Department stores managed a partial rebound in 2021-22 but remain around 19% behind pre-Covid levels overall. As a result, profits remain elusive and the shake up in the industry continues. 
On the plus side, luxury sales continue to surge and management is now more engaged than for years.
Although we remain negative on the sector overall, some companies will bounce back strongly as detailed in this in-depth review of the sector.


Japan Department Stores: Sales Recovery but the Real Opportunity Is in Margin Growth

Equity Bottom-Up

Isetan Mitsukoshi Holdings Ltd / Equity Bottom-Up

<ul>
<li>Isetan-Mitsukoshi is dangerously dependent on a small number of wealthy customers for a lot of its revenue.</li>
<li>Wealthy VIP customers account for around half of sales at both Isetan Shinjuku and Mitsukoshi Nihonbashi department stores</li>
<li>But the wealth market is one of the few segments to continue to grow so should be a source of growth even while the rest of its market shrinks.</li>
</ul>


Isetan-Mitsukoshi is dangerously dependent on a small number of wealthy customers for a lot of its revenue.
Wealthy VIP customers account for around half of sales at both Isetan Shinjuku and Mitsukoshi Nihonbashi department stores
But the wealth market is one of the few segments to continue to grow so should be a source of growth even while the rest of its market shrinks.


50% of Sales at Isetan-Mitsukoshi Flagships from Top 5% of Customers

<ul>
<li>Subscription usage continues to rise in Japan and a new survey suggests just under 50% of teens and 20s plan to use a subscription service this year.</li>
<li>Daimaru-Matsuzakaya’s luxury and designer brand rental business has been so successful that the company had to turn away new members for a while.</li>
<li>The department store's owner, <a href="https://www.smartkarma.com/entities/j-front-retailing-co-ltd" target="_blank" data-smartkarma-citation="entities:8947:1" rel="noopener">J Front Retailing (3086 JP),</a> sees subscriptions as a third pillar to its business in the future.</li>
</ul>


Subscription usage continues to rise in Japan and a new survey suggests just under 50% of teens and 20s plan to use a subscription service this year.
Daimaru-Matsuzakaya’s luxury and designer brand rental business has been so successful that the company had to turn away new members for a while.
The department store's owner, J Front Retailing (3086 JP), sees subscriptions as a third pillar to its business in the future.


Subscriptions Provide Growth Model for J Front's Daimaru-Matsuzakaya

<ul>
<li>Takashimaya will close its store in Tachikawa early next year.</li>
<li>This can be seen as a further sign of an improving outlook for a smaller department store sector. </li>
<li>More closures will rid the sector of excess capacity and solidify positioning as a genuinely upscale format for the affluent.</li>
</ul>


Takashimaya will close its store in Tachikawa early next year.
This can be seen as a further sign of an improving outlook for a smaller department store sector. 
More closures will rid the sector of excess capacity and solidify positioning as a genuinely upscale format for the affluent.


Japan

Takashimaya Company, Limited., founded in Kyoto in 1831, operates department stores.  The Company's main stores are located in Tokyo, Osaka, and Kyoto. Takashimaya also operates department stores in Paris, France, Singapore, China, Australia, and New York, USA.  The Company retails clothing, foods, art objects, sundry goods, and household utensils.  The Company also operates restaurants.

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Takashimaya (8233 JP)

Japan's Retailers, Hotels, Carriers Rejoice: Domestic Tourism Surges and Inbound Traffic Rises

Tourism is back in Japan, both domestic and inbound. We outline some of the key beneficiaries and expectations for a return to 2019 levels by next...

Michael Causton

Japan Department Stores: Sales Recovery but the Real Opportunity Is in Margin Growth

The Japanese department store sector suffered terribly during the pandemic and is in long-term decline but key companies are rebounding strongly...

Michael Causton

50% of Sales at Isetan-Mitsukoshi Flagships from Top 5% of Customers

Isetan-Mitsukoshi is focusing on VIPs which already account for 50% of sales at its flagships but this is not enough. Drags on sales and profits...

Michael Causton

Subscriptions Provide Growth Model for J Front's Daimaru-Matsuzakaya

Subscription retailing is on the up in Japan including at the luxury end, providing a way for J Front to not only add new revenue streams but also...

Michael Causton

Takashimaya to Close Tachikawa

Takashimaya is closing a major department store shortly. This is actually good news for the firm and for the sector and should herald a new era of...

Michael Causton

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