Retail landscape in Japan
Store retailing remains the trusted retail method in Japan. Even though the number of retail stores has been on a steady decline in recent decades, brick-and-mortar stores remain the main points of sale for non-durables like daily goods and foodstuff in Japan. At the center of the retail market are convenience stores, commonly referred to as konbini. While the small corner shops are limited in their range of products and sales floor area, the dense store network caters to the busy lifestyle in the country, allowing for spontaneous and fast shopping trips on the way.On the other side of the spectrum are large retail establishments such as shopping malls, department stores, and large specialty retailers, which predominantly specialize in the distribution of non-food products. However, with large e-commerce enterprises such as Rakuten and Yahoo broadening the product and service availability in their respective marketplaces, traditional retailers are struggling to defend their market share against the convenience of shopping around the clock.
Domestic competition
While the high disposable income of consumers offers an attractive market with high potential, foreign retailers are struggling to enter the Japanese market. Successful domestic brands are enjoying the trust of consumers and the efficiency of tightly woven supplier networks, which are hard to grasp and incorporate for foreign entrants. Large global businesses like Walmart and Tesco have reported their failed attempts to penetrate the rigid retail structure, pulling out of the markets after unsuccessfully appealing to Japanese consumers.Among businesses successful in garnering consumers’ attention, however, online platforms are gaining traction. Online shops of overseas consumer brands have been riding trends to reach out to domestic shoppers, mixing up non-food markets like the beauty segment through cross-border e-commerce. Furthermore, the online marketplace Amazon has successfully expanded to the Japanese market, providing domestic and overseas businesses a platform to enhance their reach.
