How to make Japan retail market entry a success How to make Japan retail market entry a success? 4 key success factors for profitable and sustainable retail expansion FUKUTOKUSHA K.K.
#1 Create “Magic” with the 1st Store Locate the brand’s 1st store in TOKYO in prime location e.g. Ginza or Shinjuku, facing the street For the brand to spread word-of-mouth across Japan and rise awareness most efficiently Such a location requires high rent, so the store must make super-high sales from super-high customer transaction, therefore… (continue to next slide)
#1 Create “Magic” with the 1st Store PR the brand through Japanese media BEFORE 1st store opens to give brand a highly fashionable image Make Japanese consumers feel hunger for the brand and have them eagerly wait for the brand Then, consumers will line up in “Gyouretsu” Make sure cameras will wait for 1st store opening and the photos will be disseminated across media
#2 Build Bond with “Developers” Almost all shopping complexes in Japan are built by major “Developers” e.g. AEON or railway companies Building good relationship with “Developers” is a must to achieve successful store expansion If a brand succeed in achieving profitability with the store in prime location, shopping center tenancy offers will be awarded by “Developers” to the brand But don’t rush; hierarchy exists among “Developers”— prioritize business with higher hierarchy “Developers”
#3 Be Prepared for the Fast Expansion Every successful retail company experiences fast market expansion stage When the time comes, flood of new store opening opportunities come all at once Securing human resources and finance become very critical at that stage Build relationship with labor market and finance market before the fast expansion stage starts, in order not to miss the chance for growth
#4 Be Prepared with New Store Concepts When a brand grows and penetrates in Japan market, new store concepts become necessary to grow further for two reasons; “Developers” start requesting new “news” as a tenancy condition to revive media attention “Small” size store type become necessary to secure real estate location for further expansion Small physical store size Small sales but profitable
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