Japan's retail landscape

Japan is the land of the rising convenience store. There were 52,725 of them in 2014 – a growth of almost 5,000 in just two years. It’s unlikely you’ll be selling much online to Japanese consumers that competes with the product range in a convenience store: 65% of the roughly £63 billion they sold last year 24 was food, and most of the remainder was small ticket non-food consumables. However, as we’ll see in the logistics and payment sections below, the existence of one convenience store per <2400 consumers is very relevant to your proposition in other ways.

Total retail sales in Japan are approximately £1 trillion per annum. The percentage of retail sales contributed by food is unusually high (Figure 8), almost two thirds (for comparison it’s about 53% in the UK).

At the highest level, Japanese retail data follows the American convention of dividing retail into Food, GM, Clothing & Apparel. The official statistics also divide into convenience stores, supermarkets, department stores and others.

Category data

Category breakdown data is shown in Figure 9. There’s a rather large block described as "others", but as we’ll see below, one thing which can be safely assumed is that this is largely made up of categories which don’t sell significantly online. What’s less clear is if there’s some leakage out of the named blocks (probably from smaller retailers) and that therefore most non-food categories might be a bit bigger than this data implies.

Within fashion/apparel, the data breaks down further as follows (Figure 10):

Although the official data irritatingly merges women’s and children’s wear, the breakdown is that £41.7 billion represents womenswear, and the remainder children/baby 22% of these sales take place in department stores and a further 52% in fashion specialists

(Interestingly the report that provides this extra detail, a non-government source, uses the phrase "cool Japan" in manner reminiscent of "cool Britannia".)

Top local retailers

The following table shows the top 20 Japanese retail groups (Figure 11).

The first thing that will immediately strike western retailers is the surprising absence of huge supermarket groups at the top of the ladder, à la Tesco, Carrefour or Kroger. Secondly, there’s the scale of convenience stores.

The third consideration, probably more important for those evaluating cross-border ecommerce opportunities, is the dominant presence of groups describing themselves as "department stores" (which often also sell food). Many of these have strong online presences, and so multi-branded competitors are likely to be stronger than in many other markets you might consider entering.

The top 50 retailers break down as follows (Figure 12):

Global retailers have a presence, but it’s rather small compared to many other countries. This may change in future – for example, Walmart has just taken a majority stake in the supermarket chain Seiyu in which it had a minority interest for many years – but it probably isn’t an issue to worry about much when planning for Japan.


  Japanese retail has a slightly unfamiliar structural feel to it. The landscape is dominated by department store groups, and supermarkets are oddly absent as biggest players.

  Allowing for non-comparable items in the statistics especially around food, and a slightly wealthier country overall (at current exchange rates), the overall market is consistent with the UK: it’s a bit larger than double the size for roughly double the population.

  Despite the strong presence of department stores, over half of fashion sales still happen in specialist retailers.

  There are an awful lot of convenience stores in Japan!





Japan's online shopping behaviours

Japan's competitive landscape

Marketing in Japan

Legal framework and regulation in Japan

Internet usage and connectivity in Japan

Payment and Logistics in Japan