Japan Convenience Store Sales:

 Article Source: https://mainichi.jp/english/articles/20230120/p2g/00m/0bu/052000c

Article:

TOKYO (Kyodo) -- Convenience store sales in Japan rose 3.7 percent from a year earlier to a record 11.2 trillion yen ($87.2 billion) in 2022, helped by the first increase in customer visits in four years amid eased COVID-19 restrictions, an industry body said Friday.

The same-store sales of seven major convenience store operators grew for the second consecutive year, thanks to robust sales of items such as boxed lunches, rice balls, frozen food products and soft drinks, according to the Japan Franchise Association.

The number of customer visits was up 0.9 percent at 15.8 billion, though the figure was still short of the pre-pandemic level in 2019.

Ideas:

Probably the increase in sales at convenience stores is more related to inflation related to the increase in prices at restaurants, supermarkets and so on.

I don't think you can equate an increase in international tourists as a reason for the increase in convenience store sales.

But the first paragraph is a little unclear as what does "the first increase in customer visits in four years" but it might be foreign visitors but not sure.

The number of customer visits is still impressive at 15.8 billion which means they might have been multiple visits by some customers.

Article:

Together with the higher number of shoppers, sales growth was driven by a record average spending per customer of 711.50 yen, an increase of 2.8 percent.

An official at the association said that the record sales reflect consumer behavior of seeking to buy before prices rise for more products.

Sales were boosted as buying daily necessities in bulk at one location, which became popular under the coronavirus restrictions, has become a long-term trend, according to the association.

Ideas:

Convenience stores have become an important component for the buying of daily necessities as maybe inflation is forcing some customers to seek out lower prices at convenience stores compared to other retail outlets.

Convenience stores used to be just for convenience or limited time shopping but it seems now they are a major shopping location for many trying to find more convenience and lower prices.

And as convenience stores improve their stores offerings they might be on-par now with other retail outlets related to the buying of daily necessities and even other products.

But of course they will never replace the traditional supermarket but has never been an convenience stores strategy to completely replace supermarkets, but they have done a very good job of creating niche markets.

Article:

The gain in sales was also contributed to by the National Travel Discount program, started by the government in October to help revamp domestic tourism, the association said, adding that convenience stores have developed and offered new products that cater to the increased turnout.

In December alone, sales were up 3.9 percent from the same month in 2021 at 1 trillion yen on high demand for Christmas-related food items such as cakes and chicken.

The number of the overall convenience stores in Japan stood at 55,838 at the end of 2022, falling for the first time since the end of 2019.

Ideas:

As tourists/customers move around Japan, they of course are looking for time-saver opportunities and diverse products that might not be offered in traditional supermarkets.

But at some point, as with any market situation, there might come a point that the convenience store market becomes saturated or too many for the Japanese domestic market.

But the decrease in number of stores might not be related to saturation but more about the pandemic or a combination of factors.

It will be interesting to see what just 2023 brings related to more sales or less sales more stores or less stores.

Have a nice day and be safe!