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

<ul>
<li>Create SD is one of the largest food &amp; drug hybrid retailers in Japan and dominates its home Kanagawa market. </li>
<li>The company now plans to grow sales by 49% over the next five years, adding 30-40 stores a year.</li>
<li>With the supermarket sector now entering a period of significant disruption, Create also plans to acquire local chains to accelerate expansion.</li>
</ul>


Create SD is one of the largest food &amp; drug hybrid retailers in Japan and dominates its home Kanagawa market. 
The company now plans to grow sales by 49% over the next five years, adding 30-40 stores a year.
With the supermarket sector now entering a period of significant disruption, Create also plans to acquire local chains to accelerate expansion.


Create SD Plans More M&A as Kanagawa Dominance Strengthens

Genky DrugStores Co Ltd / Equity Bottom-Up

<ul>
<li>Genky Drugstores is one of three hybrid food &amp; drug chains, all of which target the discount end of the market. </li>
<li>Unlike rivals, Genky’s blends in-house control of both store and product development, and logistics.</li>
<li>This level of control and discipline is making Genky a growing threat to competitors in central Japan.</li>
</ul>


Genky Drugstores is one of three hybrid food &amp; drug chains, all of which target the discount end of the market. 
Unlike rivals, Genky’s blends in-house control of both store and product development, and logistics.
This level of control and discipline is making Genky a growing threat to competitors in central Japan.


Genky Drugstores (9267 JP) Aims for 10% Growth

Thematic (Sector/Industry)

<ul>
<li>Core inflation rates remain stubbornly high and real wages are still falling. </li>
<li>Surveys suggest one more major round of price hikes in October but the government still thinks prices will stabilise below its 2% target by the end of the year.</li>
<li>The increases are lowering consumer confidence – bad news for most retailers, although major discount chains are making hay while the sun, well, doesn’t shine.</li>
</ul>


Core inflation rates remain stubbornly high and real wages are still falling. 
Surveys suggest one more major round of price hikes in October but the government still thinks prices will stabilise below its 2% target by the end of the year.
The increases are lowering consumer confidence – bad news for most retailers, although major discount chains are making hay while the sun, well, doesn’t shine.


Japanese Prices Rise Again; 60% of Consumers Feeling the Pinch and Looking for Better Value

Event-Driven

<ul>
<li>Aeon will almost definitely increase its stake in Tsuruha Holdings, which on its own will catalyse drugstore competitors to consider their mergeable options.</li>
<li>Tsuruha MAY merge with Welcia under Aeon and just talk of this will catalyse drugstore competitors even more.</li>
<li>But the ongoing fusion of drugstore retailing and FMCG formats like supermarkets and convenience stores, will also spur the entire FMCG sector to respond to Aeon's massive potential dominance.</li>
</ul>


Aeon will almost definitely increase its stake in Tsuruha Holdings, which on its own will catalyse drugstore competitors to consider their mergeable options.
Tsuruha MAY merge with Welcia under Aeon and just talk of this will catalyse drugstore competitors even more.
But the ongoing fusion of drugstore retailing and FMCG formats like supermarkets and convenience stores, will also spur the entire FMCG sector to respond to Aeon's massive potential dominance.


Aeon (Maybe) Gets Tsuruha, Could Trigger Wave of Mergers in the Sector (And Beyond)

<ul>
<li>The possible merger between Welcia and Tsuruha under Aeon has been talked about for years despite concerns from both drugstores, but may now happen.</li>
<li>But calling these retailers drugstores is increasingly a misnomer: FMCG-drugstores is better because they and many others in the sector, increasingly compete with FMCG retailers like supermarkets and even CVS.</li>
<li>This evolution is rapid so the merits of a deal make more sense when we view it from a sector five years in the future than how it is today.</li>
</ul>


The possible merger between Welcia and Tsuruha under Aeon has been talked about for years despite concerns from both drugstores, but may now happen.
But calling these retailers drugstores is increasingly a misnomer: FMCG-drugstores is better because they and many others in the sector, increasingly compete with FMCG retailers like supermarkets and even CVS.
This evolution is rapid so the merits of a deal make more sense when we view it from a sector five years in the future than how it is today.


Aeon, Welcia and Tsuruha: Creating an FMCG Behemoth

Japan

KUSURI NO AOKI CO., LTD. operates a drug store chain.  The Company sells medical drugs, cosmetics, toiletries, household and sundry goods, and groceries.  Some of their stores sell alcoholic beverages and frozen foods as well.

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Kusuri No Aoki (3398 JP)

Create SD Plans More M&A as Kanagawa Dominance Strengthens

Create SD, a major food & drug retailer in Japan, aims to increase sales by 49% in 5 years by adding 30-40 stores annually and acquiring local...

Michael Causton

Genky Drugstores (9267 JP) Aims for 10% Growth

Genky Drugstores' unique blend of low prices, in-house control over store, product development, and logistics is making it a growing threat to...

Michael Causton

Japanese Prices Rise Again; 60% of Consumers Feeling the Pinch and Looking for Better Value

Japanese consumer markets have three big trends: higher prices/squeezed incomes, doubling of single households and more people feeling the pinch....

Michael Causton

Aeon (Maybe) Gets Tsuruha, Could Trigger Wave of Mergers in the Sector (And Beyond)

Aeon's potential increased stake in Tsuruha Holdings and possible merger with Welcia will likely prompt drugstore competitors to consider their...

Michael Causton

Aeon, Welcia and Tsuruha: Creating an FMCG Behemoth

Merger between Welcia and Tsuruha under Aeon may happen as FMCG-drugstores increasingly compete with supermarkets and CVS, so we need to view the...

Michael Causton

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Create SD Plans More M&A as Kanagawa Dominance Strengthens

​Create SD, a major food & drug retailer in Japan, aims to increase sales by 49% in 5 years by adding 30-40 stores annually and acquiring local...

Michael Causton

Genky Drugstores (9267 JP) Aims for 10% Growth

​Genky Drugstores' unique blend of low prices, in-house control over store, product development, and logistics is making it a growing threat to...

Michael Causton

Japanese Prices Rise Again; 60% of Consumers Feeling the Pinch and Looking for Better Value

Japanese consumer markets have three big trends: higher prices/squeezed incomes, doubling of single households and more people feeling the pinch....

Michael Causton

Aeon (Maybe) Gets Tsuruha, Could Trigger Wave of Mergers in the Sector (And Beyond)

​Aeon's potential increased stake in Tsuruha Holdings and possible merger with Welcia will likely prompt drugstore competitors to consider their...

Michael Causton

Aeon, Welcia and Tsuruha: Creating an FMCG Behemoth

​Merger between Welcia and Tsuruha under Aeon may happen as FMCG-drugstores increasingly compete with supermarkets and CVS, so we need to view the...

Michael Causton

Create SD, a major food & drug retailer in Japan, aims to increase sales by 49% in 5 years by adding 30-40 stores annually and acquiring local...

Genky Drugstores' unique blend of low prices, in-house control over store, product development, and logistics is making it a growing threat to...

Aeon's potential increased stake in Tsuruha Holdings and possible merger with Welcia will likely prompt drugstore competitors to consider their...

Merger between Welcia and Tsuruha under Aeon may happen as FMCG-drugstores increasingly compete with supermarkets and CVS, so we need to view the...