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2014年10月 7日 (火)

ダイエー消滅 新たな流通革命につながるか

The Yomiuri Shimbun
Daiei’s demise must be followed by next distribution revolution
ダイエー消滅 新たな流通革命につながるか

The trade name of Daiei Inc., a pioneer in supermarket operations that revolutionized Japan’s distribution industry, is disappearing for good.

Its parent company, Aeon Co., has announced that it will make a full acquisition of Daiei, whose outlets will consequently be operated under the Aeon brand by the end of 2018.

Launched in Osaka in 1957 by the late Isao Nakauchi, Daiei won the support of consumers with its discount sales, which were made possible through bulk purchasing under its strategy of selling “quality products at ultralow prices.”

Riding the tide of Japan’s high economic growth, Daiei achieved remarkable growth thanks to its strategy of aggressively expanding its outlets.

In 1972, its sales surpassed those of the Mitsukoshi department store chain to become Japan’s largest retailer, reaching the ¥1 trillion mark for the first time in 1980.

Daiei succeeded in cutting purchasing costs by bypassing wholesalers and buying products directly from makers. It also boldly challenged the business practice of makers setting uniform retail prices. Daiei thus achieved a revolution in the distribution sector by winning the right to set retail prices on the back of its astonishing sales records. The great contribution it has made should be applauded.

Things appeared to be going smoothly for Daiei until the firm suffered financial problems in the wake of a fiasco in hotel operations, which it entered during the bubble economy period of the late 1980s. In a strategic blunder that dealt the company a serious blow, Daiei sold one of its rapidly growing subsidiaries, the Lawson convenience store chain, losing vital revenue from the promising convenience store business.

Challenges in Internet age

After embarking on a tortuous path that included resorting to financial support from the governmental Industrial Revitalization Corporation of Japan, Daiei became an Aeon subsidiary in 2013.

After the full acquisition is completed, Aeon aims to streamline operations by integrating Daiei and Aeon supermarkets. Merely changing the signboard from Daiei to Aeon, however, will not win customers.

The distribution industry has shifted from the age of supermarkets to a golden era of convenience stores. In addition, online sales have dramatically increased.

Goods and services purchased on the Internet by households have increased about fivefold over the past 10 years. The sales made on websites operated by Rakuten Inc. have already surpassed those of major department store and supermarket chains.

It is hoped that another distribution revolution will emerge to create new business models that meet consumers’ needs by using realignments that transcend industries as leverage.

It is worrying, however, that new supermarkets and convenience stores are being opened mostly in Tokyo and its vicinity, where stable earnings are projected. As things stand, it is feared that the trend will further fuel cutthroat competition over limited shares.

In contrast to urban areas, rural communities, where supermarkets and convenience stores are few and far between, have seen a steep increase in the number of people who have difficulty visiting such outlets, including elderly residents who do not drive.

The revival of the retail industry hinges on how it can adequately respond to such changes in the social structure as depopulation, a graying society and a gap between urban and rural areas.

(From The Yomiuri Shimbun, Oct. 6, 2014)Speech


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