All bad news from the retailing front

While the government is trying to put up a brave front by insisting that the recession has bottomed out—and is offering eco point incentives to encourage people to replace their TVs, home appliances and cars—consumers aren’t taking the bait.

Just how bad have business conditions become? Shukan Gendai (July 25) investigated department stores, hotels, and designer brand boutiques in Japan’s three largest metropolitan areas and found nothing encouraging to report whatsoever.

An executive at a Tokyo department store says the number of shoppers is unchanged over the past several years. “But there’s a big difference in their spending patterns,” he notes. “I don’t see any sign of a sales recovery. For example, last year the average outlay for ‘ochugen’ summer gifts was 3,000 yen. This year it’s in the 2,000-yen range.”

Tokyo’s luxury-class hotels, with occupancy rates hovering around the halfway point at the average, are offering special discounts on overnight package deals, with a few, like the Westin and Hotel Okura, dropping their rates by as much as 61% under certain conditions, such as late-evening check-in.

The food and beverage industry has also been taking it on the chin.

“Designer brand firms like Armani and Bvlgari have opened high-class restaurants in Ginza, but their situation right how is awful,” says Minoru Murakami, director of a trade publication. “When I visited them on a weeknight, there were only one or two couples in the whole place. The atmosphere was bleak; the diners were watched constantly by ‘attentive’ staff, which ruined the ambiance.”

Like department stores, it appears, the shops dealing in pricey designer brands find that their stores still attract plenty of browsers, but few buyers. Sales this year are projected to fall below the 1 trillion yen mark, roughly one-half the all-time peak in 1996.

“Even affluent shoppers are questioning the logic of paying the asking price in brand shops and department stores,” says the editor of a trade magazine. “They are much more guarded now and more feel the way to go is to scrounge for bargains at factory outlet stores and special sales.”

While the article mainly covers the slump in demand for high-ticket items, Shukan Gendai is unable to resist a brief peek at more plebian male-oriented diversions.

“These days we’re lucky if we get two groups of customers in the course of one evening,” says a “mama” at a club in Osaka’s Kitashinchi entertainment district. “We’d reduce the number of hostesses, but if many customers were to come in all at once, we couldn’t provide them with good service. It’s a real problem.”

The boss of a chain of sex shops in Nagoya says demand is down by 30 to 40% from last year. “Before, customers who went drinking at an ‘izakaya’ or cabaret club would drop in to one of our ‘health’ (massage parlors) afterwards,” he sighs. “Now some girls only minister to a single customer a day. They’ve been leaving us, one by one.”

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14 Comments

DeepAir65 at 11:06 AM JST - 14th July

“Now some girls only minister to a single customer a day. They’ve been leaving us, one by one.”

some good news then for a change - hopefully they can lead a more productive life
Beelzebub at 11:11 AM JST - 14th July

some good news then for a change - hopefully they can lead a more productive life

Hmmm. But who do you think were patronizing the designer brand shops and restaurants?
Gaijinocchio at 11:42 AM JST - 14th July

three largest metropolitan areas and found nothing encouraging to report whatsoever.

The bubble popped a long time ago people. It's too bad the lost years are continuing into a global recession, but you know who could've made things better by not neglecting domestic markets? The J-gov.

Do you know who didn't make things better? The J-gov.
womanforwomen at 11:55 AM JST - 14th July

“These days we’re lucky if we get two groups of customers in the course of one evening,” says a “mama” at a club in Osaka’s Kitashinchi entertainment district. “We’d reduce the number of hostesses, but if many customers were to come in all at once, we couldn’t provide them with good service. It’s a real problem

Yes, 'mama' time you change your line of business to something else. 'cos it is not going to get better for your business for a long while now. All those papas who were visiting you are spending 'quality' time with their kids.
tkoind2 at 03:54 PM JST - 14th July

Beelzebub has a very valid point. The people I have met in Japan with flash clothing, top end designer this and that, expensive jewelry etc... are mostly hostesses. Some with flash from their patrons, but most from buying stuff with their salaries. But life must be getting hard for them.

One clear sign has been this hostess bar that is near one of my favorite cafe spots. Before when passing by the girls and their scalper guys would ignore anyone foreign passing by. Now you can barely shake them off. I have found an alternate route to avoid them. So they must be desperate.
Monoflow at 03:57 PM JST - 14th July

The crisis is not too bad, finally people tend to go back to the roots instead spending all of their money for useless stuff. Sorry for the people lost their job, but if the world will ticking right, there will be enough work for everyone...
as_the_crow_flies at 11:39 AM JST - 15th July

WEll, considering what the article tells us people were spending on - high-end restaurants, designer stuff, massages, hostesses, I'd say it's good news. People are finally seeing sense and not wasting money on useless fluff.
stirfry at 07:03 PM JST - 15th July

hardly a newsflash
noborito at 10:40 PM JST - 15th July

Service sucks. That's why. Went to a store today. A store I have spent thousands of yen at over the years. Some new part-timer told me, after I requested to try on a polo shirt, that I wasn't permitted because I was not wearing a t-shirt. She proceeded to say that it is how now a days and sweat will soil the shirt. So because I didn't have on a t-shirt I couldn't try on the shirt. So, basically I could buy things from the Internet 1/2 price or even more. Simply put, I walked out and purchased what I wanted online. If I don't like it I will ship it back to America. Buy American. (Or your respected countries goods.) Why spend money for terrible service.
Beelzebub at 10:50 PM JST - 15th July

Gosh, noborito, I'm glad you weren't trying on a swimsuit.
goingtoshopping at 11:59 PM JST - 15th July

I just saw on AlJazeera that Uniquo is posting record profits, making the richest man in Japan, well, even richer. So not ALL bad...
koneko22 at 01:58 PM JST - 16th July

Shop at the Salvation Army Thrift Stores....your friendly neighborhood front yard sale.... or the 100 Yen Stores...better yet...start a "consignment store"....try the American economy...IOU's from your state's government...banks no longer accept them...$$$hits has hit the fan...
realist at 08:04 AM JST - 17th July

Japan is in bad shape - spiritually, socially and economically. Sadly, I feel that things can only get worse here, due to the failed educational and social system.
Ah_so at 06:47 AM JST - 23rd July

But all good news for the cheap end retailers, like Uniqlo or Hard Off, where you can get good quality 2nd hand stuff at a huge discount.