Japanese consumers have also begun to devise countermeasures to rising prices. Many companies have passed on rising raw material, labor, and transportation costs to their products and services. While raw material and labor costs remain high, Saizeriya is pursuing a strategy of streamlining store operations and increasing customer numbers while maintaining value for money. In an industry that price hikes are commonplace, companies that can make profits without raising prices may be reevaluated. Speaking of service, the convenience store format offers something wonderful. Combi’s proactive approach to developing products tailored to consumer needs has supported its growth. Convenience stores have grown steadily. However, dark clouds are beginning to gather over Tokyo’s convenience stores.
Based in Saitama Prefecture, Yaoko operates stores widely in the Tokyo metropolitan area, including Chiba Prefecture. Yaoko was cautious about opening stores in Tokyo due to high costs, such as real estate rent, making it difficult to predict business prospects. This company opened its first store in Tokyo’s 23 wards in June of this year. Yaoko is accumulating know-how and seeking to expand its presence within the wards. This new force’s strategy is to appeal to Tokyo customers with new attractions, such as low prices. It’s a strategy to capture consumers who are put off by rising prices. Intensifying price competition poses a major threat to convenience stores. If they appeal to Tokyo customers with low prices, convenience stores will be unable to survive by maintaining the status quo. If convenience stores avoid price wars, they will need to create new appeal through their products and services. However, intense competition benefits Tokyo residents.
Trial is a company expanding into Tokyo, not only from nearby Saitama but also from as far away as Kyushu. There’s a clear reason why Trial is taking on small, urban stores, centered around Tokyo. The regions where Trial has expanded are experiencing population decline. Demographics are crucial for the retail industry. Operating in densely populated areas leads to increased profits. Looking at the prefectures, only Tokyo and Chiba saw an increase in population. Trial’s expansion into Tokyo has attracted attention from various industries. Many major food manufacturers seem to be paying attention to the growth potential of Trial’s small stores. Attention is focused on what kind of chances Trial has of competing against convenience stores with overwhelming name recognition such as “7-Eleven.”
