Recent Retail Trend in Japan Japan Retailers Association

日本小売業の最新動向 Recent Retail Trend in Japan 日本小売業協会 国際担当部長 近江　淳 Japan Retailers Association Director General Manager International Affairs Division Jun Omi

ABOUT JRA 　 The Japan Retailers Association (JRA) was founded in May 1978, promoted by the Japan Department Stores Association, Japan Chain Stores Association and other organizations involved in retail, centered on the Japan Chamber of Commerce and Industry and with the objective of healthy development of the retail industry in Japan and to contribute to the lives of the nation's people.

The JRA carries out activities together with numerous organizations • • • • Japan Department Stores Association Japan Chain Stores Association Japan Supermarket Association New Supermarket Association of Japan Specialty Store Association Japan Foodservice Association Japan Franchise Chain Association Japan Voluntary Chain Association Japan Council of Shopping Centers Japan Independent Stores Association Japanese Consumers' Co-operative Union Federation of Specialty Store Association in Japan The Japan Chamber of Commerce and Industry The Tokyo Chamber of Commerce and Industry

ABOUT FAPRA The Federation of Asia-pacific Retailers Associations (FAPRA) was founded in 1989. Its has implemented its activities and developed itself with the aim of discussing issues shared in the region, promote information exchange and friendship, thereby contributing to the development of commerce, the improvement of retailers’ status and the improvement of citizens’ lives in the region.

Member OF FAPRA 17 countries & area ・Japan 　　　　　　 ・ Korea ・Chinese Taipei　 ・ China ・ Hong Kong　　　・ Thailand ・ Philippine　　　 ・ Fiji ・ Malaysia ・ Mongolian ・ Singapore ・ Indonesia ・ New Zealand ・ Australia ・ India ・Turkey ・ Vietnam

Photos of APRCE in Singapore October 11 -13

History of last APRCE 1983　The 1 st APRCE held in Tokyo, Japan 1985　The 2 nd APRCE held in Seoul, Korea 1987 The 1 st APRCE held in Hong Kong 1989 The 4 th APRCE held in Singapore 1991 The 5 th APRCE held in Bangkok, Thailand 1993 The 6 th APRCE held in Manila, Philippine 1995 The 7 th APRCE held in Kuala Lumpur, Malaysia 1997 The 8 th APRCE held in Adelaide, Australia 1999 The 9 th APRCE held in Taipei 2001 The 10 th APRCE held in Jakarta, Indonesia 2003 The 11 th APRCE held in Christchurch, New Zealand 2005 The 12 th APRCE held in Beijing, China 2007 The 13 th APRCE held in Tokyo, Japan 2009 The 14 th APRCE held in Seoul, Korea 2011 The 15 th APRCE held in Singapore 2013 The 16 th APRCE is held in Istanbul, Turkish

1982年以来 29年の歴史を持つアジア最大の小売業の祭典 　　　　　　 The 16 th Asia-Pacific Retailers Convention & Exhibition Venue：Turkey Istanbul Date ：September 23 -26, 2013

LOGO of the Istanbul Conference 16 th APRCE ISTANBUL 2013 Asia-Pacific Retailers Convention & Exhibition

Recent Retail in Japan ･Total retail sales in Japan over previous years ･Market size in Japan ･GDP & GDP per capita ･Ratio of Modern trade in Japan ･Global Retailers in Japanese market

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Population, size of consumption & per capita Country or Area Population (100 M) Size of market(b $) Consumption per capita($) Japan 1. 3 2839 21838. 4$ China 13. 3 1613 1213. 1$ India 11. 9 683 574. 6$ Asean 5. 8 857 1478. 1$ USA 3. 0 10010 33367. 1$ South America 3. 9 1742 4467. 7$ EU 5. 0 10516 21032. 8$ Africa 9. 5 912 960. 126$

Trend of GDP in Japan

Trend of Population(2000～ 2010) Japan, China, India & other continent 14

Shrinking Domestic Retail Market in Japan Shrinking domestic market due to rapid aged society, shrinking population, & stagflation Percentage of Over 65 yrs old

Reduction of Small Store & Total units Store unit　　　　　Source: Ministry of International Trade & Industry (MITI) 2006 Bubble bursting in 1991

Bigger stores & shopping centers ITO-YOKADO

Total retail sales in Japan over previous years

Reconstruction from great earthquake in Eastern JAPAN

Entry & Withdrawal of global retailers in Japan black-entry, red-withdrawal 1980　Channel/Louis Vuitton/Gucci 1991　Toysras/Prada　 1995　GAP 1998　Boots/ZARA 1999　Costco/Sephora 2000　Carrefour 2001　Metro 2002 Wal-Mart 2003　Tesco 2009　Forever 21/Abercrombie-Fitch 　　　 20

Structure of Retail industry Japan USA 5. 46 M 1. 3 M 1. 65 M 6% 25% 65% 88% 150 b$ 440 b$ 1350 b$ 2660 b$ 20 M 30 M 12 M 150 M 13000$ 81000$ 104000$ 161000$ 1. 71 4. 11 6. 13 7. 17 Number of store per 1000 people 11. 13 4. 25 9. 29 5. 86 Number of store per 1 k㎡ 3. 56 0. 57 3. 12 21 0. 17 　 　 India Number of stores 　 12 M Ratio of modern trade Sum of year Sales Number of employer 　 Per capita sales(1 store) Number of employer at each store China　　

Ratio of Globalization sales amount of global retailers in Japan Total sales amount Global Retailers % Less than 2. 0%

Consumption per capita in the world （2008：unit /$） 23

Change of consumption target : commodity to non-commodity Recently, the consumer’s expenditure composition tends to shift; from commodity to non-commodity. When assuming such a trend continue toward 2010, commodity consumption ratio in 2010 might decrease by 2. 2 points than that in 2004. All Rights Reserved, Copyright ©㈱富士通総研 2008 24

Comparison of sales by primary retail format and trends ( Ｕｎｉｔ：Ｂｉｌｌｉｏｎ　Ｙｅｎ )

Reorganization of retailing group by M&A 2003　　　　2005　　　　2007 Seven & i Holdings Millennium Retailing AEON & DAIEI & edion Group & J. FRONT RETAILING UNY & IZUMIYA & Isetan Mitsukoshi Holdings H 2 O Retailing DCM Japan GMS Department store Electronics center All Rights Reserved, Copyright ©㈱富士通総研 2008 NOW Home center 26

Domestic Ranking : Sales of retailers in 2012 Ranking Company Sales in 2012 (M　$)1 $=100 Format １（２） Seven & I Holdings Co. , Ltd. Group（GMS、Department CVS） ２（１） Aeon Co. , Ltd. ３（４） Yamada Denki Co. , Ltd. ４（３） Mitsukoshi-Isetan Holdings ５（５） J. Front Retailing Co. , Ltd. ６（７） First-Retailing Co. LTD　 ７（６） store、 Year/ year 47863 -6. 5% Group （GM store、Drugstore、CVS・・） 46508 1. 9% Discount （Electronics） 18354 -15. 8% 12399 1. 6% 9414 -0. 9% Specialty stores 9286 11. 3% UNY Co. , Ltd. Supermarket 9076 -4. 2% ８（９） Takashimaya Co. , Ltd. Department store 8581 -1. 3% ９（８） . Daie Co. , LTD Supermarket 8093 -4. 7% Discount （Electronics） 27 7590 -15. 8% All Rights Edion Reserved, 10(10) Co. , Copyright Ltd ©㈱富士通総研 2008 Department store

TOP 3 of Department Stores(M　$)1 $=100 Rank Company 1 2 3 Mitsukoshi. Isetan J. Front Retailing Takashimaya Sales Number Share of Amount of Store Format 34 19. 9% 12399 9414 20 15. 1% 8581 24 13. 8%

TOP 3 of GMS (M　$)1 $=100 rank company 1 2 Seven & Ai Group Aeon Group 3 Uny Group Sales Number Share of amount of stores format 47836 449 25. 5% 46507 1084 24. 7% 9076 109 4. 8%

TOP 3 of Discount(Electric) (M　$)1 $=100 rank company 1 2 3 Yamada denki Edion K’s Denki Holdings Sales Number Share of amount of stores Format 640 29. 3% 18354 7590 1130 12. 1% 7260 372 11. 6%

TOP 3 of CVS(2012) (M　$) rank Company 1 2 Seven-Eleven Japan Lawson 3 Family Mart Sales Number Share of (M $) of store format 35084 15458 38. 9% 16934 11151 18. 8% 15845 9182 17. 6%

TOP 3 of drag store(2012) (M　$)1 $=100 Rank Company Sales Number Share of Amount of Store Format 4346 1073 11. 5% 1 Matsumoto. Kiyoshi Holdings 2 Sun Drag 3868 621 10. 2% 3 Sugi Holdings 3273 718 8. 6%

出典：百貨店の業界再創造研究報告書（日本百貨店協会） Spread of new channel : E-Commerce Sales trend of E-Retail All Rights Reserved, Copyright ©㈱富士通総研 2008 33 33

5 Key words of Japan retail Industry • • • Smaller Stores Shifting to major urban centers Price and Value Compound Development Senior Customers

The latest retail trends : “ Smaller stores ”

The latest retail trends : “shifting to major urban centers”

Structure & trend of population in Japan(unit: 1000 person)

高齢者・生産人口・子供の人口推移 Trend of Old-person･Children & Worker

The latest retail trends : “ price and value ”

Trend of real Income (unit: yen/per month)

Future Store in Japan---Denim Fitting room Shelf display Availability in stock Search for other clothes in dressing room Communicate to Cellular phone Provided for article information e－Recommendation All Rights Reserved, Copyright ©㈱富士通総研 2008 Active Type RFID 43 平成 17年度　三越フューチャーストア実証実験報告書より加筆転載

Shoes counter Approach in Japan ---RFID The customer can check a stock by oneself Be in supply or Not immediately All Rights Reserved, Copyright Stockyard ©㈱富士通総研 2008 44 平成 16年度　百貨店アパレル電子タグ実証実験報告書より加筆転載

The latest retail trends : “compound development” Establish as an annex to Convenience store with Drugstore, companies 112 store opened 9

Development of new format CVS + Drags

The latest retail trends : “senior customers”

The latest retail trends : “senior customers”

Best format for Japanese retail market “ small & 　 sophisticated supermarket ”

Structure of Distribution Industry Europe and U. S. Ｍａｎｕｆａｃｔｕｒｅ Ｄｉｓｔｒｉｂｕｔｏｒ Ｒｅｔａｉｌｅｒ Purchase・Supply Stock Delivery Marketing Manufacture Sort Stock Selling Process Delivery Sort Service Ｃ ｏ ｎ ｓ ｕ ｍ ｅ ｒ Japan Ｍａｎｕｆａｃｔｕｒｅ Ｗｈｏｌｅｓａｌｅｒ Ｒｅｔａｉｌｅｒ Purchase・Supply Stock Delivery Marketing Manufacture Process Marketing Selling Stock Sort Service Stock Ｄｉｓｔｒｉｂｕｔｏｒ All Rights Reserved, Copyright ©㈱富士通総研 2008 Stock Sort Process Delivery Service 50 Service Ｃ ｏ ｎ ｓ ｕ ｍ ｅ ｒ