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Nikkei: “Devastation” awaits department stores in 2010

The Nikkei certainly isn’t mincing words when it comes to describing the state of Japan’s department store industry. In an article entitled “More Devastation Awaits Dept Stores In ‘10,” the paper made its case for why the department store industry might see a record number of closures over the coming year.

The Nikkei points out that after five department stores had been shutting down each year, that number rose to nine in 2009 and ten are already scheduled to close this year. The current all-time high is 15 closures in 2000. That was the year in which department store giant Sogo collapsed. Read more

Mutantfrog: The history of department stores in Kyoto

For an absolutely awesome writeup on the history of department stores in Kyoto, check out Roy Berman’s recent post “The history of department stores in Kyoto, and Kyoto in the history of the department store” at the Mutantfrog Travelogue.

McDonald’s betting on coffee for profit growth?

On Monday, McDonald’s Japan reported that its pretax profit had jumped 25% in the January-September period compared to a year ago, despite a 10% drop in same-store sales, which can be explained by the conversion of many shops to franchises during this period. Overall sales were actually up 3.3%, again hitting an all-time high. Existing store sales were up 1.7% although the number of customers actually showed a 0.6% decline.

In an effort to get more customers in its shops, McDonald’s gave away free coffee on a few dates during the third quarter. Although the number of customers at existing stores showed a decline, this figure is also mitigated by the transformation of centrally owned shops to franchises. Read more

A tale of two businesses: NTT and McDonald’s release results

Earlier today, NTT announced that its net profit had fallen 20.5% in the first quarter (April-June) of 2010, to a total of about 139.6 billion yen. At the ame time, operating income fell 12.4% to 325.8 billion yen.

Without question, NTT is operating in a hostile, competitive environment, especially with regards to its mobile unit, NTT DoCoMo. Last week, DoCoMo announced that first quarter profit had slid 15.1% to 147.4 billion yen. It is now obvious that DoCoMo is becoming a burden on the NTT group. In March 2008, DoCoMo’s share of Japan’s mobile phone market fell below 50% for the first time since 1998, as rivals AU and Softbank have chipped away at their customer base. How did DoCoMo fight back? They offered free calls between family members, released a line of new handsets and rolled out a new logo. Read more

Ikea to cut prices in Japan: A furniture price war?

Two months after rival furniture retailer Nitori’s announcement that it would cut prices on 400 items by 15 to 40 percent, Ikea announced on Monday that it plans to cut prices on 1,450 items by an average of 25%.

Nitori is Japan’s largest furniture retailer, and it has reported stunning figures for its most recent quarter, with sales up 15% to 76.7 billion yen in the March-May quarter. Nitori initially predicted a 2% rise in sales for the year through February 2010, though that has been revised upward to a projected 14% increase. Read more

Tuesday morning headlines: Food producers moving into China, TV sales and the Aso Cabinet

The Nikkei’s Tuesday morning edition is reporting more moves by Japanese food producers into the Chinese market. First, Maruha Nichiro intends to begin farming trout in the Philippines later this year and shipping the fish live to China. The firm is hoping for sales of around 1 billion yen within a few years. On the beer front, Kirin is now selling its brew to watering holes in Shanghai, and is hoping to sell 150,000 cases of 12 500ml bottles this year. Finally, House Foods and Ichibanya aim to increase the number of their joint-owned curry shops in China from the current 13 to to 41 by the end of March 2012. Read more

Uniqlo keeps rolling: May same-store sales up 18.3%

According to a press release issued today, Uniqlo saw same-store sales in Japan climb 18.3% in May against a year ago. Uniqlo has now seen same-store results increase for seven consecutive months.

While sales were up 18.3%, the number of visitors increased 18.7%, which means the average sale actually declines 0.3% in May. According to the press release, total sales including direct sales increased by 25.7% in May. Read more

Swine flu a convenient scapegoat? Should the media look in the mirror?

An article published yesterday at the Japan Times opens by telling us that the H1N1 swine flue virus is hurting industries such as tourism and retail, especially in Western Japan. Of course, economists fear that the impact of swine flu will only make a bad situation worse.

Near the top of the article, however, we get this quote:

The outbreak “could pour cold water on the Japanese economy at a time when it just started to bottom out and was about to recover,” said Toshihiro Nagahama, chief economist at Dai-ichi Life Research Institute Inc.

Emphasis mine. The writers of the article never comment on whether or not this assertion is true, and no figures are provided to back it up. We’re simply supposed to accept the assertion that the economy has “bottomed out” at face value? While it’s certainly hard to imagine seeing anything resembling the previous quarter’s GDP figures coming up again sometime soon, and exports and production figures are looking better, that doesn’t necessarily mean things have bottomed out. Read more

Family Mart to enter the Vietnamese market

Just two weeks ago, Seven-Eleven announced that it would be entering the Indonesian market. On the heels of that news, Family Mart announced today that it has plans to enter the Vietnamese market. Family Mart will be forming a joint venture with Vietnam’s Phu Thai Distribution and Investment Group as well as Itochu. Apparently, Family Mart’s first shop will be opened in Ho Chi Minh, and the firm aims to open 300 locations in Vietnam over the next five years.

Seven-Eleven to set up shop in Indonesia

A few days ago the Nikkei reported that Seven-Eleven Inc. has reached a licensing agreement with Modern International Group, an Indonesian firm that will bring Japan’s largest convenience store brand to Indonesia as early as this fall. While the Nikkei notes that strict regulations often make it difficult for firms to set up shop in Indonesia, plans are for the first locations to open in Jakarta and be followed by stores in Bandung and Surabaya.

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