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Elderly at record spurs japan stores chase $1.4 trillion by wgre ethbtn
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Elderly at record spurs japan stores chase $1.4 trillion |
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Business,Business News,Business Opportunities
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May 10, 2012 Unicharm Corp. (8113) s sales of adult diapers in Japan exceededthose for babies for the first time last year. At Daiei Inc. (8263)supermarkets, customers can feel Japan aging -- literally: It hasmade shopping carts lighter.
Companies are rushing to grab a bigger chunk of the estimated 109trillion yen ($1.4 trillion) that consumers over 60 spent in theyear ended March 31 in Japan. The number of Japanese over 65 hit arecord 23.3 percent of the population in October. We perceive this change as a golden opportunity for growth, Shohei Murai, executive vice president of supermarket operator AeonCo. (8267), told reporters in March.
In the 80s and 90s, Aeonset families that were the massive majority in terms of populationas its main target. Now the elderly are going to be the engine ofconsumption. Aeon, Asia s largest retailer, is putting medical clinics in someof its locations. Japan s fertility rate is 1.39 for women, compared with 1.93 inthe U.S., according to the Ministry of Health, Labour and Welfare.Japan s population, which peaked in 2005, is poised to shrink to125.2 million in 2014 from 126.5 million last year, according todata compiled by Bloomberg. Model Case The country is becoming a test case of how a modern retail economycan switch from focusing on traditional, younger customers.
It could be a model case, said Naoki Fujiwara, chief fundmanager at Shinkin Asset Management Co. They are remodelingstores and changing products portfolios. It may take time, buttheir efforts will be successful not only in Japan, but alsooverseas. Unicharm, Japan s largest diaper maker, said it s counting onjust that.
The Tokyo-based company said the lessons it s learningin Japan will help its expansion in China, where the population ator above 65 rose to 8.87 percent of the total as of Nov. 1, 2010,up 1.91 percentage points from the 2000 census. China introduced aone-child policy in 1979 to curb population growth. China will necessarily face the aging society at a faster pacethan Japan because of the one-child policy, said Unicharm ChiefExecutive Officer Takahisa Takahara in April. We have theresponsibility to take Japan s standards and spread it intoAsia.
Value Conscious Japanese retailers have no choice. People over 60 spent more thanany other age group in the year ended March and accounted for 44percent of Japan s consumption, according to calculations fromAeon, based in Chiba, near Tokyo. As the aging society proceeds, elderly people are re- evaluatingsuch retailers like convenience stores that sell small packagedfoods said Fujiwara. The elderly people buy things that havevalue even if the price is high.
They are the group which has thatfinancial power. Keizo Okuyama, 93, who lives in Tokyo with his sister, on a recentvisit to an Aeon store said he spends about 1,000 yen to 1,500 yenat the outlet every day. He likes the small food packages Japaneseretailers offer to attract elderly customers living alone or insmall families. I have pension from serving the military in addition to regularpension, he said.
I have more money than others. Adapting to Needs Such shoppers are forcing retailers to retool their businesses.Daiei, based in Tokyo, is slowing escalators to two- third of thespeed of regular ones and employing lighter shopping carts usingaluminum at some stores, said Daiei spokesman Aichiro Yamaguchi. We will reinforce our efforts on elderly people as a measure toexpand our sales, he said. Japan had 29.8 million people over 65 as of October, according tothe Ministry of Internal Affairs and Communications.
Seven-Eleven convenience store operator Seven & I Holdings Co.(3382) has a new card in Japan to offer discounts at pension time.In April, the company introduced a variation of its electricmoney card, a kind of debit card, offering a 5 percent discountto people over 65 when pensions are paid out. Aeon and Daiei havesimilar cards targeting the elderly. Seven & I has started to operate trucks that go around areaswith a shortage of retailers to sell rice balls and sandwiches toreach senior citizens. Lunch Box Delivery Convenience store chain FamilyMart Co. (8028) announced in Marchthat it will acquire lunch box delivery operator Senior Life CreateCo.
to provide services for the elderly. The two biggest retailers, Aeon and Tokyo-based Seven & I, mayhave an edge in attracting the elderly because they have the mostcash to invest in store changes, said Koji Toda, chief fund managerat Resona Bank Ltd. in Tokyo. In terms of financial muscle, companies like Seven & I andAeon are at an advantage, Toda said.
Companies have to open notjust one or two stores, but many stores to lock in customers. At Unicharm, said Takahara, who is also president, the adultdiapers business is becoming increasingly important to the company. Domestic sales of diapers for the elderly are growing by doubledigits, Takahara told reporters last month. It s an extremelyimportant business in terms of both sales and profit margin. I am Sports & Entertainment writer, reports some information about head tennis bags , hanging porch swing.
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