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

If <a href="https://www.smartkarma.com/entities/mercari-inc" target="_blank" data-smartkarma-citation="entities:27149:1" rel="noopener">Mercari Inc (4385 JP)</a> were a retailer, the CtoC platform would now be Japan’s 5th biggest vendor of apparel, symbolic of just how influential it has become and the significant role of used fashions in the wider market.
And it is not just fashion. Mercari is now handling all manner of household goods, even food. It is also increasingly influencing the sale of new goods thanks to new services for major retailers in data flow and marketing.
So big is its influence, even the Tax Office now has a Mercari department.
Not surprisingly, Mercari's success is attracting more competitors. <a href="https://www.smartkarma.com/entities/z-holdings-corp" target="_blank" data-smartkarma-citation="entities:19603:1" rel="noopener">Z Holdings (4689 JP)</a> launched PayPay Flea Market just over a year ago and is now doing what it does best: slashing fees and piling on incentives to try and grab share from the market leader.

If Mercari Inc (4385 JP) were a retailer, the CtoC platform would now be Japan’s 5th biggest vendor of apparel, symbolic of just how influential it has become and the significant role of used fashions in the wider market.
And it is not just fashion. Mercari is now handling all manner of household goods, even food. It is also increasingly influencing the sale of new goods thanks to new services for major retailers in data flow and marketing.
So big is its influence, even the Tax Office now has a Mercari department.
Not surprisingly, Mercari's success is attracting more competitors. Z Holdings (4689 JP) launched PayPay Flea Market just over a year ago and is now doing what it does best: slashing fees and piling on incentives to try and grab share from the market leader.

Mercari’s Relentless Innovation Opens Closets

Thematic (Sector/Industry)

Penetration (the share of total retail sales) of e-commerce in Japan increased sharply in the past few years but still varies significantly by category.
The following insight looks at each consumer product category and how penetration has grown in the last few years and provides estimates of trends to 2025.
Even with these relatively cautious rates of growth, penetration rates are set to expand significantly in apparel, household &amp; interior, books &amp; media, and stationery but only retailers with form in successful online marketing will benefit from this with major negative implications for the many retailers that have failed to tackle the threat from online. This includes even major retailers like <a href="https://www.smartkarma.com/entities/seven-i-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:1041:1" rel="noopener">Seven &amp; I Holdings (3382 JP)</a> which lags behind <a href="https://www.smartkarma.com/entities/aeon-co-ltd" target="_blank" data-smartkarma-citation="entities:3:1" rel="noopener">Aeon Co Ltd (8267 JP), </a><a href="https://www.smartkarma.com/entities/rakuten-inc" target="_blank" data-smartkarma-citation="entities:31:1" rel="noopener">Rakuten Inc (4755 JP)</a><a href="https://www.smartkarma.com/entities/aeon-co-ltd" target="_blank" data-smartkarma-citation="entities:3:1" rel="noopener">  and </a><a href="https://www.smartkarma.com/entities/amazon-com-inc" target="_blank" data-smartkarma-citation="entities:409:1" rel="noopener">Amazon.com Inc (AMZN US)</a> in the race to lead the battle for leadership in online food retailing.

Penetration (the share of total retail sales) of e-commerce in Japan increased sharply in the past few years but still varies significantly by category.
The following insight looks at each consumer product category and how penetration has grown in the last few years and provides estimates of trends to 2025.
Even with these relatively cautious rates of growth, penetration rates are set to expand significantly in apparel, household &amp; interior, books &amp; media, and stationery but only retailers with form in successful online marketing will benefit from this with major negative implications for the many retailers that have failed to tackle the threat from online. This includes even major retailers like Seven &amp; I Holdings (3382 JP) which lags behind Aeon Co Ltd (8267 JP), Rakuten Inc (4755 JP)  and Amazon.com Inc (AMZN US) in the race to lead the battle for leadership in online food retailing.

E-Commerce Penetration Increasing in All Retail Categories

The following is an in-depth review of the retail sector by format with a brief overview of incomes and consumption trends and metrics before that. For any investor looking at the Japanese consumer/retail space, this insight will provide a rapid overview of all the major trends.2020 was a year to remember, although not for good reasons. While the news was overwhelmingly negative given the devastation that the pandemic caused to so many lives, for Japan as a country the experience could become a catalyst to spur positive change.No matter how much we might never wish to repeat the last 12 months, those governments and companies that learn from the experience will be better positioned whenever a new pandemic emerges.Department stores, convenience stores, and most fashion chains had a horrible year as so many people stayed away from major shopping areas, but many other retailers actually had stellar years, with further upside still to come.

The following is an in-depth review of the retail sector by format with a brief overview of incomes and consumption trends and metrics before that. For any investor looking at the Japanese consumer/retail space, this insight will provide a rapid overview of all the major trends.2020 was a year to remember, although not for good reasons. While the news was overwhelmingly negative given the devastation that the pandemic caused to so many lives, for Japan as a country the experience could become a catalyst to spur positive change.No matter how much we might never wish to repeat the last 12 months, those governments and companies that learn from the experience will be better positioned whenever a new pandemic emerges.Department stores, convenience stores, and most fashion chains had a horrible year as so many people stayed away from major shopping areas, but many other retailers actually had stellar years, with further upside still to come. 

Japan Retail Full Review 2020-2021: Some Retail Sectors Outperform in a Pandemic

Only 35 new SCs are expected to open this year, the lowest number in more than two decades and five of these will be rebuilds of other shopping facilities. At the same time, the character of new malls is changing, with dining making up 24% of new sales last year, up nine points, and merchandise tenancies accounting for only just over half. There are serious implications for the wider retail industry, particularly fashion and lifestyle specialty chains.

Only 35 new SCs are expected to open this year, the lowest number in more than two decades and five of these will be rebuilds of other shopping facilities. At the same time, the character of new malls is changing, with dining making up 24% of new sales last year, up nine points, and merchandise tenancies accounting for only just over half. There are serious implications for the wider retail industry, particularly fashion and lifestyle specialty chains.

Japan Shopping Mall Development Stalls in 2021

Last year the Japanese fashion market contracted below ¥16 trillion for the first time in more than a decade and this year is proving much, much worse.In the last big crises – the 2008 financial shock and 2011 triple disasters – demand also fell dramatically and then recovered. But this time is different: as well as a fall in demand, the Covid-19 crisis has also led to a marked fall in supply.But there is some good news. Above all, Japanese are not travelling either at home or abroad and they are also eating out less.In the seven months to July, the average working household had cumulatively saved a net ¥1.25 million, more than 11 months in both 2018 and 2019 and more than an entire year before 2018.Suddenly wallets are full, which could mean more money to spend on treats – good news for luxury but also any brand or retailing offering something fun to divert from the all bleak news.While the short-term outlook remains dark, the medium-term should see both a return to a more stable trading environment and something of a splurge too as people express their relief that it’s all over.The following is a complete review of the Japanese apparel/fashion sector including rankings of the top 100 retailers by sales, top by profit, sales growth, and store openings/closures.This insight is labelled bullish because the Japanese apparel/fashion sector will rebound from the current crisis although the long-term outlook for this sector is stagnant stability rather than significant growth. However, within this, there are significant growth stocks as detailed below.

Last year the Japanese fashion market contracted below ¥16 trillion for the first time in more than a decade and this year is proving much, much worse.In the last big crises – the 2008 financial shock and 2011 triple disasters – demand also fell dramatically and then recovered. But this time is different: as well as a fall in demand, the Covid-19 crisis has also led to a marked fall in supply.But there is some good news. Above all, Japanese are not travelling either at home or abroad and they are also eating out less.In the seven months to July, the average working household had cumulatively saved a net ¥1.25 million, more than 11 months in both 2018 and 2019 and more than an entire year before 2018.Suddenly wallets are full, which could mean more money to spend on treats – good news for luxury but also any brand or retailing offering something fun to divert from the all bleak news.While the short-term outlook remains dark, the medium-term should see both a return to a more stable trading environment and something of a splurge too as people express their relief that it’s all over.The following is a complete review of the Japanese apparel/fashion sector including rankings of the top 100 retailers by sales, top by profit, sales growth, and store openings/closures.This insight is labelled bullish because the Japanese apparel/fashion sector will rebound from the current crisis although the long-term outlook for this sector is stagnant stability rather than significant growth. However, within this, there are significant growth stocks as detailed below.

Japan Fashion Retailing Complete Review 2019-20: Pain Now but a Recovery Is Certain

Japan

Adastria Co., Ltd. operates a chain of clothing stores in Japan. The Company also operates stores in China, Taiwan, Hong Kong and Korea.

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Adastria Co Ltd (2685 JP)

Mercari’s Relentless Innovation Opens Closets

Mercari now dominates CtoC trading in Japan and is so big a Tax Office department is names after it. Competitors are circling, particularly Z...

Michael Causton

E-Commerce Penetration Increasing in All Retail Categories

A review of online market share in all key consumer categories in Japan, with forecasts for e-commerce market share to 2025 –the sharp growth will...

Michael Causton

Japan Retail Full Review 2020-2021: Some Retail Sectors Outperform in a Pandemic

An in-depth update for investors in Japan's retail and consumer space on Japan's retail sector by retail type as well as a review of the impact of...

Michael Causton

Japan Shopping Mall Development Stalls in 2021

The collapse in new shopping mall development in Japan does not just affect real estate developers but also the wider retail industry, especially...

Michael Causton

Japan Fashion Retailing Complete Review 2019-20: Pain Now but a Recovery Is Certain

The following is a complete, in-depth review of the Japanese apparel/fashion sector covering key trends, rankings of the top 100 by sales and top...

Michael Causton

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