Food retail channelsThe distribution of food products shows one of the highest diversifications in the retail sector in Japan, ranging from specialty retailers in small neighborhoods over supermarket chains active throughout the whole country to large department stores carrying an assorted food section. In the non-store segment, direct distributors are competing with online marketplaces and catalog mail-order businesses. However, digital food and beverages sales remain the consumer goods segment with one of the highest growth potentials in Japan, facilitated by the low e-commerce penetration within the sector.
As the declining self-sufficiency of the Japanese agricultural sector is resulting in a growing reliance on imports to cover the domestic demand, food retailers are maintaining their roles as an intermediate to bridge the gap between wholesalers and consumers. With online supermarkets struggling to consolidate their positions in a market, in which store retail is preferred for buying daily necessities, channels like supermarkets have successfully braved the challenges of the slow shift to e-commerce. In particular, in the supply chain of nondurable produces are store retailers entrusted with the task of supplying even small neighborhoods with fresh meats, fishery products, and freshly harvested crops.
Holidays and food retailFood retail in Japan is heavily impacted by seasonal changes and holiday events. Even though Japanese cuisine has evolved and adapted to the rising popularity of Western foods, dishes prepared with seasonal ingredients and often associated with specific holidays remain a part of Japanese eating behavior. Linked to festive gatherings with a variety of traditional dishes, holiday seasons drive the market demand for food ingredients and ready-to-eat meals. Monthly food sales in Japan surge at the end of the year, facilitated by the food traditions related to Christmas Eve and New Year’s events. While fried chicken is a popular companion to the Christmas mood in December, opulent tiered boxes stacked in several layers and filled with a multitude of prepared dishes (osechi) are served for the New Year’s festivities. Traditionally prepared at home in the past, retailers are benefitting nowadays from the interest in ready-made boxes to cater to the busy days towards year-end.
But not only during holidays are prepared meals found on the shelves of retail stores, even during ordinary days are meals-to-go popular for their convenience. Consequently, food retailers are exploring new opportunities in the ready-to-eat segment to expand the business outside of fresh food distribution, with fast food counters being already a major contributor to convenience store sales in Japan.