Death knell sounds for a few of Japan’s oldest department shops


Tokyo, September 7

After greater than three centuries in enterprise, the Onuma division retailer in northern Japanese metropolis of Yamagata started chapter proceedings this yr — considered one of many distinguished department shops throughout the nation in dire straits.

Known for fancy meals halls, luxurious gadgets, impeccable service and, of their heyday, rooftop sights to entertain households, Japan’s department shops have been in an extended gradual decline as purchasing habits change.

Now the coronavirus pandemic, simply because it has pressured US retailers akin to Lord & Taylor and Neiman Marcus out of business, is hammering nails into coffins for some — notably these in regional areas.

Last month, 146-year-old Nakago closed the doorways of its final remaining retailer in Fukushima metropolis, additionally within the north, whereas Izutsuya Co Ltd, a sequence within the southern metropolis of Kita Kyushu, shuttered considered one of its two most important shops.

“Everyone agrees it’s very disappointing, but the truth is that people haven’t been shopping at these stores lately,” mentioned Shuhei Yamashita, a retail guide who hopes to purchase the Onuma division retailer from collectors and switch it round.

This yr, with customers cautious of purchasing and tourism decimated amid the pandemic, gross sales have plunged. Industry gross sales dropped by a fifth in July from a yr earlier and policymakers worry extra retailer closures and bankruptcies are inevitable.

Even earlier than this yr’s woes, Japanese department shops have struggled to remain related, promoting gadgets akin to $10,000 kimonos and posh tableware to take care of their cachet at the same time as shopper tastes have turned in the direction of extra casual gadgets. At the identical time, customers have taken a lot of their purchasing on-line.

Both industry-wide gross sales and retailer numbers have tumbled 30% since 1999. Some of the nation’s 203 department shops have additionally drastically shrunk ground house by bringing in different tenants.

Big nationwide chains and shops in main cities haven’t been immune. Isetan Mitsukoshi Holdings Ltd, for instance, has closed a number of shops over the previous decade and mentioned in March it could shut a Mitsukoshi retailer in downtown Tokyo subsequent yr.

However, it’s the prospects for regional shops and the implications for his or her native economies — already wracked by a long time of deflation, anaemic development and an exodus of younger folks trying to find higher jobs — that are inflicting probably the most concern.

Policymakers fret retailer failures might sow seeds of disaster, exacerbating ache felt all through a neighborhood economic system to the purpose that beleaguered regional lenders won’t be able to deal with will increase in non-performing loans.

“Closures will weigh on property prices, jobs and many other aspects of an already weakening regional economy,” mentioned a authorities official with experience in regional finance, talking on situation of anonymity.

Japan’s Chief Cabinet Secretary Yoshihide Suga, the frontrunner to grow to be the nation’s new prime minister this month, has made revitalising regional economies a key coverage precedence.

But whether or not any of the federal government’s pledge of $2.2 trillion in stimulus for pandemic-hit corporations finds its strategy to department shops stays an open query with some authorities officers and politicians privately saying that the cash must be funnelled in the direction of extra viable industries.

Everything has modified

In Yamagata, the way forward for the Onuma division retailer stays unclear. Although Yamashita’s firm is eager to maintain the shop going, collectors might choose to promote to a higher-paying bidder.

Some locals appear resigned to Onuma’s failure, saying it had did not sustain with altering life together with the rise of on-line retailers and quicker transport hyperlinks to greater cities.

“Infrastructure, transportation, lifestyles, information, culture, values – everything has changed,” Takashi Inoue, president of a steel processing firm in Yamagata, wrote in a weblog as he lamented Onuma’s chapter.

For now, Yamashita’s firm helps to maintain the shop open by means of the top of September, though the meals corridor is closed and consumers are restricted to looking for offers amongst home items and garments he has gathered from numerous warehouses.

Still, Yamashita isn’t giving up hope that collectors might be satisfied by his plans to revamp the shop.

“It’s a place people once loved,” he mentioned. “It will be a shame if it becomes just another high-rise development.” Reuters



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