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Japan supermarket sales show first rise in 26 months in February

March 25, 2008
By Ken Worsley


In January, we saw Japan’s supermarket sales fall for the 25th consecutive month and wondered when this site would finally be able to report a rise in sales. It has finally happened: According to data released by the Japan Chain Stores Association, supermarket sales in Japan were up 1.9% in February on a year-on-year basis.

It’s way too soon to say we have an uptrend, as supermarket sales have still fallen in 46 of the past 48 months. We are also suspicious that rising prices might have more to do with the increase than a pickup in consumer spending, though we will have to wait until the end of this week to see the data on household spending for February.

Here’s a breakdown of sales by category in February:

  • Food: +3.7%, 64.8% of total revenue
  • Household Products: nil, 19.0% of total revenue
  • Clothing: -3.1%, 10.5% of total revenue
  • Miscellaneous Items: -1.4%, 5.3% of total revenue
  • Services: -6.1%, 0.4% of total revenue

What do these numbers tell us? We’ve been noting for some time now that supermarkets have actually been doing well on the sales of food. In other words, core business has not been so bad. Sales of household products, clothing and services, however, have been dragging the overall figures down month after month.

Food sales increased from 59.4% of total revenue in January to 64.8% in February. In December, food sales were at 59.25 of overall revenue. A year ago, clothing represented 11.1% of sales, while two years ago it stood at 11.2%. In February 2005, that figure was at 11.4%.

Selling more food as a proportion of the whole thus seems to bring about better overall sales. We are forced to wonder if food sales are increasing due to the price increases or because supermarkets are making an effort to focus on core operations.

There were a total of 427,884 employees on payroll at the nation’s supermarkets in February, down from 441,651 in January and 467,866 in December. The number of full-time workers, about which 2/3 of are men, fell slightly, from 128,737 in January to 127,767 in February. The number of part-timers slipped from 312,914 in January to 300,117 in February.

Filed Under Economic Reports, Retail, Supermarkets 

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Comments

5 Responses to “Japan supermarket sales show first rise in 26 months in February”

  1. David on March 26th, 2008 11:21 am

    It is good to see the increase of 1.9%, until you factor in that because of the leap year February had about a 3.5% increase in the number of days compared to last year. Or did the data take that into account somehow?

  2. Ken Worsley on March 26th, 2008 4:47 pm

    David, here’s what I see:

    The 1.9% increase is what was reported “post adjustment”, which means that sales at new shops (those that have existed for less than a year), have been tossed out.

    Before adjustment, total sales actually show a drop of 2.39%, from about 1.025 trillion yen to 1.001 trillion yen.

    There are also 106 fewer shops in the February 2008 numbers.

    Here is a breakdown of the total figures, which includes newly opened shops. If we go through and adjust for the extra day, it looks something like this:

    February 2008: 100,089,091万円 total (1,000,890,910,000 yen total)
    /8656 shops: 115,629,726 yen per shop
    February 2008/29: 34,513,479,655 yen per day
    /8656 shops: 3,987,232 yen per shop per day

    February 2007: 102,543,036万円 total (1,025,430,360,000 yen total)
    /8762 shops: 117,031,540 yen per shop
    February 2007/28: 36,622,512,857 yen per day
    /8762 shops: 4,179,698 yen per shop per day

    In other words, even adjusting for the extra day and the 106 fewer shops, we see lower total sales in February 2008 - when the “newly opened shops” are left in the totals.

  3. David on March 28th, 2008 2:11 pm

    Ken,

    Thanks for the detailed analysis. It more clearly shows what I was implying - that even though the headlines said it was an increase it was still, in reality, a decrease in sales.

  4. (Un)steadily as She Goes in Japan | Technophobiac Finance Blog on April 2nd, 2008 11:17 am

    […] This point seem to be anecdotally confirmed if we turn Ken Worsley and his ardent watching of Japanese supermarket sales. As Ken succinctly puts it … What do these [the] numbers tell us? We’ve been noting for […]

  5. (Un)steady as She Goes in Japan | Technophobiac Finance Blog on April 2nd, 2008 4:09 pm

    […] This point seem to be anecdotally confirmed if we turn to Ken Worsley and his ardent watching of Japanese supermarket sales. As Ken succinctly puts it … What do these [the] numbers tell us? We’ve been noting for […]

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