Osaka – Sunday, May 23, 2010
A recent popular morning TV news programme in Japan reported on a new social issue of “Shopping Refugee”. This is as a result of aging society, nuclear family and strategy/M&A of retailers (supermarkets). Possible new products and services could help shopping refugees if they can afford such new products and services.
1. What are “shopping refugees”?
Shopping refugees are those people who are forced to do shopping at large supermarkets that are far to go on foot instead of local shopping areas which are only a few minutes walk. Most shopping refugees are elders living alone (i.e. not with their children) in not scarcely-populated regions but in comparatively large cities of local region.
2. What is the traditional shopping style vs. new shopping styles of younger generation in Japan?
1) Traditional shopping style of today’s elders
Japanese people used to shop almost daily at nearby shops of groceries, greengrocers, fish and meat shop etc. and/or local small supermarket in local shopping areas on foot. Typical housewives used to do all her housework in the day and decide what to cook for dinner (evening meal) and go shopping on foot then cook. Elders today are used to this shopping style.
2) New shopping styles of younger generation
There are varieties of styles, with diverse lifestyle of younger generation. Some people shop in traditional style, similarly to how their mother and grand mothers used to. Some others position shopping as their leisure and shop during day time. Some others, especially people who work, shop at late evening. And some others mostly shop at weekends, buying foods for an entire upcoming week.
Depending on where they shop, some people walk to the supermarket, some go by bus and some drive to shop.
3. What are the factors for then change in shopping styles and emergence of shopping refugees?
1) Large retailers/supermarkets and their M&A
In line with economic growth of Japan, large supermarkets such as Daiei, Aeon, Jusco and Saty emerged and expanded their business aggressively nationwide. This completely changed the retailing industry map in Japan and also the places where majority of the population do shopping.
Such large supermarkets first opened their shops in city centre such as shopping mall in the front of the stations then to shopping area of residential area which housewives still could go on foot. A few such supermarkets now are open until late at night (e.g. 22:00 and even 24:00 for some) to meet their customer needs of today. Then, many large ones opened in suburbs which the transportation would be car.
Together with low birthrate meaning decrease in total population, retailing industry became saturated, leading to restructuring and M&A of the industry and each retailers. This has resulted in closing of supermarkets in shopping area in cities higher proportion of large ones in suburbs.
2) Nuclear family
In line with economic growth, more people stopped living with their parents (elders) after marriage and nuclear family became pervasive. There are many reasons and backgrounds to this, such as less jobs are available local regions, more people working companies that operates nationwide and/or worldwide meaning more people are re-located, change in values and attitudes in majority of Japanese people to name just a few.
3) Aging society
Attributing to low birth rate, Japan has become one of the countries suffering from severe aging society. And together with pervasive nuclear family mentioned above, this resulted in many elders living alone, forced to look after themselves, including daily shopping.
4) Car society
In line with economic growth, car became popular, and going shopping by car became popular for some families, both in large cities where there are good public transportation and local regions where car is the only transportation for families.
5) Working women and mothers
With economic growth then recession of the last 2 decades, and introduction of “Equal Opportunities for Both Men and Women” started in 1985, females started to continue working after marriage and even after having children, although proportion still remains low compared to western countries. Many such working mothers were forced to do shopping at weekends for successful time management, and even full time housewives became more flexible in their shopping style.
4. What is the case of Takaoka City in Toyama Prefecture introduced in the TV programme?
1) Shopping refugees
Examples of shopping refugees introduced in the TV programme were all elders living alone or with her husband but not living with their children. They used to enjoy shopping everyday to nearby shopping area within five minutes walk from their house.
However, with recent closing of the shops they used to go for shopping everyday, they now need to go shopping by bus to supermarkets which are 1.5km to 2.0km from their house. This is a burden for them, in terms of both physically (catching bus and getting on and off the bus) and financially (bus fee).
This was not mentioned in the TV programme but the author assume that the shopping refugees would also miss the communication they had everyday with the local shop owners and staff members during shopping. The local shopping area had been one of the important local community and shopping refugees would no longer benefit of such community and daily warm interaction.
2) Change in Takaoka shopping environment
First, large retailer of Daiei opened in the front of the station, then Saty, another larger retailer opened its supermarket in more residential area, attracting big pie of the shopping population.
Then, Aeon opened a huge supermarket with large car parks in suburb, which attracted shoppers that used to go to Daiei and Saty, so Daiei closed its supermarket. Saty was acquired by Aeon. Opening of Aeon’s huge supermarket led to closing the traditional shops in the shopping area of that shopping refugees used to go as well.
5. What are possible solutions to save shopping refugees?
1) New delivery service
Delivering supermarket products for shopping refugees can be a possible solution. According to the TV programme, a NPO started to help shopping refugees by delivering what they bought from Aeon.
From this, the author sees a great business opportunity for Aeon. They could start a new delivery service for their customers including shopping refugees and other customer segments who need such services.
Also, the author thinks that similar service can be provided by others such as gasoline stations that are having difficulties for survival, convenience stores, and delivery service companies including JP Service as their new business.
Another possibility of provider of this kind of service is a versatile service provider. A self-employed business owner near the author’s house provide varieties of services requested by his customers as long as he can provide (such as repairing things, doing housework, taking dog for a walk, MC of wedding and other ceremonies to name just a few) and he also will do shopping on behalf of his customer per request.
2) New product
New product meeting shopping refugees is another possible solution. For example, ingredients for breakfast, lunch and evening meal can be a new product as a substitute and delivered everyday to the shopping refugees and other households per request. This new business has actually been proposed and started, first targeting busy working mothers, which can be targeted to shopping refugees.
6. What are the author’s thoughts to conclude?
Changes in shopping environment are unavoidable, and together with many other factors, shopping refugees are unavoidable but can be a great business opportunity for many companies and business owners, by creating new businesses (products and services). However, whether such new businesses truly solve problems of the shopping refugees depends on their financial affordability and whether they can continue to enjoy interaction with the local community.
2010年5月23日日曜日
2010年5月15日土曜日
Financial Performance of Japanese Companies Continues to Recover
Osaka – Saturday, May 15, 2010
Nikkei, Japanese newspaper specialized in business/economy, reported on May 13, 2010, that financial performance of Japanese listed companies has been continuously recovering in total. This information also went on air in most major TV news on Friday 14. Consolidated profit for fiscal year ending March 2010 was +25% vs. previous year, which was increase in profit after 2 fiscal year, largely attributing to cost reduction. The largest contributors were consumer electronics and automobile, which improved by 3.7 billion yen in total vs. previous year.
Outlook for fiscal year ending March 2011 is of further improvement; +38% for profit vs. fiscal year ending March 2010. This is largely because revenue is expected to increase after 3 fiscal years with demand increase of emerging countries, marking phase change from recovery driven by restructure to recovery driven by demand increase. However, there are risks such as high yen and price increase in resources.
1. How did Nikkei come to the conclusion?
Nikkei collected and analyzed financial data of 767 listed companies (excluding financial and new companies) that had been announced by May 12, covering 50% in number and 80% of profit, of total companies.
2. How much the financial performance of Japanese companies recover?
In total, sales for fiscal year ending March 2010 decreased by 12% vs. previous year but turned to black with drastic cost reduction by each company after the worldwide economy crisis broke out in the autumn of 2008. Quick economy recovery of emerging countries such as China and India also contributed to their financial performance recovery. As a result, profit was better by 13% than estimation as of February 2010, meaning that financial performance of Japanese companies are ongoing with speed above expectation.
Looking by industry, 19 out of 32 recovered. The total amount of profit recovered was 2 trillion yen for consumer electronics and 1.7 trillion yen for automobile. These two industries covered up deterioration of steel, maritime trade and trading companies, and in total recovery of almost 2.4 billion yen. As for some specific companies, refer the table below.
Improvement in Financial Performance of Some Major Companies
(Source: Nikkei, translated by the author)
Company Name / Amount (billion yen)
Hitachi / 353.4
Panasonic / 353.3
Toshiba / 304.2
Toyota / 851.8
Nissan / 380.4
Honda / 174.4
3. What contributed to the recovery?
The biggest contributor was restructuring including fixed and variable cost reduction. Honda reduced sales cost by over 420 billion yen, resulting in double in profit even though the revenue decreased by 14%. A vice president of Honda commented that the biggest reason for revenue recovery is the fact that they made much effort in cost reduction. Cost reduction of Toyota totaled 1 trillion yen (negative effects of the worldwide recalls were within their expectation) and 880 billion yen for Panasonic.
4. What is the outlook for fiscal year ending March 2011?
Sales for fiscal year ending March 2011 is estimated to go back to growth by 7% from the previous year, which is expected to contribute to further profit increase. Also, financial performance recovery is estimated to expand to 25 industries from 19. With recovery in purchase order from Asia, machinery and precision instrument also are estimated to return to black.
5. What are the 3 possible risks?
The first possible risk is high yen. This is a negative factor for export-oriented companies (most Japanese manufacturers are export-oriented); increase in cost of resources leads to cot up in wide a range of industries. For example in the case of Nippon Steel, if purchase cost of iron and steel stays at high level of April-June, it would result in 450 billion loss unless it can be reflected in pricing.
The second possible risk is negative effect from the fact that demand stimulation measures of each country aimed at driving sales of digital consumer electronics and automobiles is to come to end. For example, in Japan, incentives are given to consumers who purchase green products and services specified by the governments (e.g. automobile, consumer electronics, reforming house) which has been contributing to stimulating consumer spending but this incentive is to end soon.
The third possible risk is negative effect of weak economy of Greece on worldwide economy recovery.
6. What is the requirement for further recovery despite the possible risks?
Further improvement is possible if performance recovery effect is expanded to household and equipment investment sectors. This is because the profit outlook for 2010 is 60% of the peak, which was in 2008, meaning that there are some room for further recovery.
Nikkei, Japanese newspaper specialized in business/economy, reported on May 13, 2010, that financial performance of Japanese listed companies has been continuously recovering in total. This information also went on air in most major TV news on Friday 14. Consolidated profit for fiscal year ending March 2010 was +25% vs. previous year, which was increase in profit after 2 fiscal year, largely attributing to cost reduction. The largest contributors were consumer electronics and automobile, which improved by 3.7 billion yen in total vs. previous year.
Outlook for fiscal year ending March 2011 is of further improvement; +38% for profit vs. fiscal year ending March 2010. This is largely because revenue is expected to increase after 3 fiscal years with demand increase of emerging countries, marking phase change from recovery driven by restructure to recovery driven by demand increase. However, there are risks such as high yen and price increase in resources.
1. How did Nikkei come to the conclusion?
Nikkei collected and analyzed financial data of 767 listed companies (excluding financial and new companies) that had been announced by May 12, covering 50% in number and 80% of profit, of total companies.
2. How much the financial performance of Japanese companies recover?
In total, sales for fiscal year ending March 2010 decreased by 12% vs. previous year but turned to black with drastic cost reduction by each company after the worldwide economy crisis broke out in the autumn of 2008. Quick economy recovery of emerging countries such as China and India also contributed to their financial performance recovery. As a result, profit was better by 13% than estimation as of February 2010, meaning that financial performance of Japanese companies are ongoing with speed above expectation.
Looking by industry, 19 out of 32 recovered. The total amount of profit recovered was 2 trillion yen for consumer electronics and 1.7 trillion yen for automobile. These two industries covered up deterioration of steel, maritime trade and trading companies, and in total recovery of almost 2.4 billion yen. As for some specific companies, refer the table below.
Improvement in Financial Performance of Some Major Companies
(Source: Nikkei, translated by the author)
Company Name / Amount (billion yen)
Hitachi / 353.4
Panasonic / 353.3
Toshiba / 304.2
Toyota / 851.8
Nissan / 380.4
Honda / 174.4
3. What contributed to the recovery?
The biggest contributor was restructuring including fixed and variable cost reduction. Honda reduced sales cost by over 420 billion yen, resulting in double in profit even though the revenue decreased by 14%. A vice president of Honda commented that the biggest reason for revenue recovery is the fact that they made much effort in cost reduction. Cost reduction of Toyota totaled 1 trillion yen (negative effects of the worldwide recalls were within their expectation) and 880 billion yen for Panasonic.
4. What is the outlook for fiscal year ending March 2011?
Sales for fiscal year ending March 2011 is estimated to go back to growth by 7% from the previous year, which is expected to contribute to further profit increase. Also, financial performance recovery is estimated to expand to 25 industries from 19. With recovery in purchase order from Asia, machinery and precision instrument also are estimated to return to black.
5. What are the 3 possible risks?
The first possible risk is high yen. This is a negative factor for export-oriented companies (most Japanese manufacturers are export-oriented); increase in cost of resources leads to cot up in wide a range of industries. For example in the case of Nippon Steel, if purchase cost of iron and steel stays at high level of April-June, it would result in 450 billion loss unless it can be reflected in pricing.
The second possible risk is negative effect from the fact that demand stimulation measures of each country aimed at driving sales of digital consumer electronics and automobiles is to come to end. For example, in Japan, incentives are given to consumers who purchase green products and services specified by the governments (e.g. automobile, consumer electronics, reforming house) which has been contributing to stimulating consumer spending but this incentive is to end soon.
The third possible risk is negative effect of weak economy of Greece on worldwide economy recovery.
6. What is the requirement for further recovery despite the possible risks?
Further improvement is possible if performance recovery effect is expanded to household and equipment investment sectors. This is because the profit outlook for 2010 is 60% of the peak, which was in 2008, meaning that there are some room for further recovery.
2010年5月5日水曜日
Will Children’s Day in Japan be Passed On?
Osaka – Wednesday, May 5, 2010
May 5, the last day of Golden Week long holiday, is Children's Day in Japan. The national holiday is an occasion for Japanese families to celebrate the well-being of their children. May 5 was traditionally a festival for boys known as Tango no Sekku. However, this changed in 1948 when it became a day of celebration for all children.
1. What are the traditional customs associated with the day?
1) Flying carp streamers
On this day, families often fly carp streamers outside their homes to represent strength and success, and flying carp streamers are seen in many sight seeing spots. For example, tens of carp streamers are set to fly above/across the river of Oboke-Koboke in Tokushima Prefecture, which is well known for enjoyment of riding a boat down the river.
2) Dolls of famous heroes
Some families also display samurai warrior dolls of famous heroes inside their homes. The dolls symbolize strength.
Originally Japanese dolls were not children's toys to play with. In ancient times, dolls were used as effigies to rid people of misfortune and disease. It was only after the Edo period that they were made for the appreciation of annual events such as Hina Matsuri, the Girls' Festival, explained in the previous article Will Doll’s Festival Celebration Be Passed On?, and Tango No Sekku, the Boys' Festival.
After the Meiji period, dolls made of celluloid and rubber were introduced from Western countries. Barbie dolls became very popular in Japan at the end of the 60's.
Foreigners (non-Japanese people) may consider geisha dolls or those of women in kimonos to be typical Japanese dolls. They are generally quite expensive because each part of the dolls is made by hand and silk is used for their kimonos. Their faces must be painted by master craftsmen.
3) Kabuto hats
Kabuto hats, symbolize strength, similarly to dolls of famous heroes. Kabuto is a kind of helmet put on by samurai warriors. Kabuto hats are made with almost zero cost and with ease using with large paper (sometimes newspapers) by Origami methodology.
4) Bathing with iris leaves in water
Other customs associated with the day include bathing with iris leaves in the water for good health and well-being. Very often, long iris leaves are tied around the heads of boys while bathing. The origin of this custom is not clear. However, the iris leaves is called “Sobu” which is homonym of game/match/competition, and it is possible that this is the origin of the custom.
5) Rice cakes wrapped in oak leaves
The other customs associated with the day is eating rice cakes wrapped in oak leaves called kashiwamochi. This custom is originally eating chimaki, rice cakes without azuki bean inside, wrapped completely in bamboo leaf, similarly in a way samurai warriors used to take their food out. Eating kashiwamochi, which is more popular kind of rice cakes with azuki red bean inside, became the popular custom, replacing eating chimaki.
6) Measuring height
To see how children are growing with well-being, parents used to measure how tall their children are on this day by marking on a pillar inside their house. They could see the growth by comparing with the mark of the previous years. With annual health checkup at school today and there is no need to measure, this custom is no longer popular.
2. How are custom performed today?
It is quite prominent that like other traditional customs, the above customs are actually performed by less family today, which is a pity. For example, the author wanted to take photo of flying carp streamers and post it as well with this blog article because she did see a few around her house until a few years ago but she found none this year. (The photos posted are of free online photos.)
To the author, the customs has more importance and meaning with low birth rate, a serious social issue in Japan. I fact, it was announced May 4 that number of children has been on the decrease 29 consecutive years. It is quite possible that one reason that above customs are performed less today is the fact that there are few households now that have children.
It is under such circumstance that a special documentary TV programme went on the air on May 3, about a well-being of a family with 3 boys and 5 girls living in an island of Kagoshima prefecture, southern Japan. Since 1 boy and 1 girl had already left home to go on studying in senior high school and university in mainland, so the programme was mainly about the remaining 6 children. Nevertheless, the message of the programme was quite clear; wishing and encouraging people to raise as many healthy, well-being children as possible.
May 5, the last day of Golden Week long holiday, is Children's Day in Japan. The national holiday is an occasion for Japanese families to celebrate the well-being of their children. May 5 was traditionally a festival for boys known as Tango no Sekku. However, this changed in 1948 when it became a day of celebration for all children.
1. What are the traditional customs associated with the day?
1) Flying carp streamers
On this day, families often fly carp streamers outside their homes to represent strength and success, and flying carp streamers are seen in many sight seeing spots. For example, tens of carp streamers are set to fly above/across the river of Oboke-Koboke in Tokushima Prefecture, which is well known for enjoyment of riding a boat down the river.
2) Dolls of famous heroes
Some families also display samurai warrior dolls of famous heroes inside their homes. The dolls symbolize strength.
Originally Japanese dolls were not children's toys to play with. In ancient times, dolls were used as effigies to rid people of misfortune and disease. It was only after the Edo period that they were made for the appreciation of annual events such as Hina Matsuri, the Girls' Festival, explained in the previous article Will Doll’s Festival Celebration Be Passed On?, and Tango No Sekku, the Boys' Festival.
After the Meiji period, dolls made of celluloid and rubber were introduced from Western countries. Barbie dolls became very popular in Japan at the end of the 60's.
Foreigners (non-Japanese people) may consider geisha dolls or those of women in kimonos to be typical Japanese dolls. They are generally quite expensive because each part of the dolls is made by hand and silk is used for their kimonos. Their faces must be painted by master craftsmen.
3) Kabuto hats
Kabuto hats, symbolize strength, similarly to dolls of famous heroes. Kabuto is a kind of helmet put on by samurai warriors. Kabuto hats are made with almost zero cost and with ease using with large paper (sometimes newspapers) by Origami methodology.
4) Bathing with iris leaves in water
Other customs associated with the day include bathing with iris leaves in the water for good health and well-being. Very often, long iris leaves are tied around the heads of boys while bathing. The origin of this custom is not clear. However, the iris leaves is called “Sobu” which is homonym of game/match/competition, and it is possible that this is the origin of the custom.
5) Rice cakes wrapped in oak leaves
The other customs associated with the day is eating rice cakes wrapped in oak leaves called kashiwamochi. This custom is originally eating chimaki, rice cakes without azuki bean inside, wrapped completely in bamboo leaf, similarly in a way samurai warriors used to take their food out. Eating kashiwamochi, which is more popular kind of rice cakes with azuki red bean inside, became the popular custom, replacing eating chimaki.
6) Measuring height
To see how children are growing with well-being, parents used to measure how tall their children are on this day by marking on a pillar inside their house. They could see the growth by comparing with the mark of the previous years. With annual health checkup at school today and there is no need to measure, this custom is no longer popular.
2. How are custom performed today?
It is quite prominent that like other traditional customs, the above customs are actually performed by less family today, which is a pity. For example, the author wanted to take photo of flying carp streamers and post it as well with this blog article because she did see a few around her house until a few years ago but she found none this year. (The photos posted are of free online photos.)
To the author, the customs has more importance and meaning with low birth rate, a serious social issue in Japan. I fact, it was announced May 4 that number of children has been on the decrease 29 consecutive years. It is quite possible that one reason that above customs are performed less today is the fact that there are few households now that have children.
It is under such circumstance that a special documentary TV programme went on the air on May 3, about a well-being of a family with 3 boys and 5 girls living in an island of Kagoshima prefecture, southern Japan. Since 1 boy and 1 girl had already left home to go on studying in senior high school and university in mainland, so the programme was mainly about the remaining 6 children. Nevertheless, the message of the programme was quite clear; wishing and encouraging people to raise as many healthy, well-being children as possible.
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