May 26, 2017

Discover the office market! A profitable channel for hungry food companies

Japan’s retail sales have suffered from anaemia for some years with meagre spurts of growth followed by sudden declines. Inflation has been much talked about but hard to spot, meaning intensive price competition and profit margin squeeze for manufacturers. Some canny companies have however been looking further afield into new channels and routes to market. As anyone who visits Japan soon realises, the country is awash with offices, warehouses and factories; according to official economic statistics there are over 5.5 million such establishments, employing over 57 million people. Whilst there has been much publicity recently about “karoshi” or overwork, the vast majority of folk slave away loyally, often well over 50 or more hours a week. A captive market for entrepreneurially minded food companies. Selling to offices is not new. Yakult was the pioneer with its famous squads of ladies, pushing bik
April 23, 2017

Amazon Fresh. A different kettle of fish?

Amazon finally launched its fresh food delivery service in Japan last week. The business has a dedicated operations and commercial team using tailor-made warehousing in the company’s existing logistics facilities. Amazon Japan is the No 2 online business here after Rakuten with revenue north of US$10b. Not a mean achievement given it only opened shop in 2000. I found the Fresh site layout was standard Amazon fare; flat product images, with brief but uninspiring summaries on product and range assortment. Compared to some other Japanese online supermarket chains which tout specific regional or exclusive produce, for me it lacked engagement. It’s early days and one imagines the offering will be changing very regularly. The key USP is delivery time and speed as the site makes a heavy emphasis on when they need the product. Home delivery services are of course not new in Japan, today most major supermarket and CVS chains offer them. 68% Japanese consumers buy something online every mont
April 4, 2016

When will Organic cut the mustard in Japan?

Most visitors to Japanese supermarkets dazzle at the endless array of uniformly merchandised produce with not so much as a lettuce leaf out of place. For a country obsessed with food safety, quality and cleanliness, not to mention a general abhorrence of GMO, it’s surprising that “organic” remains far behind compared to the US, Europe and indeed other leading Asian markets.   Even more surprising because five years after Fukushima much of the country has lost faith in nuclear, there’s a groundswell in favour of simplicity, purity and back to nature.   Why then has Organic food household penetration yet to break 1% and average spend stutters at a paltry JPY1000 per year?   Change may be afoot. Recently more retailers are ranging organic food and there is an emerging network of online evangelists.   However for organic to really blossom, several ingredients ar
March 5, 2016

Ironclad secrets to strengthen Japan’s Washoku business

Japanese food is booming! Exports soared 21% in 2015 to US$521m. Today there are over 55,000 sushi, teppanyaki, ramen and shabu-shabu restaurants outside Japan, double 2006.    “Washoku” a word meaning Japanese food, is one of the top 3 global food “brands” along side Chinese and Italian according to a recent survey published by Jetro, a Government agency. Bureaucrats in Tokyo have ambitions to formalise Washoku along the lines of French Champagne or Devon Cream.    However behind the headlines, the reality is that Japan’s food export business remains a drop the ocean. Yes there are armies of Japanese food and beverage companies, but most have yet to venture overseas.    The most popular Japanese exports are expensive cuts of fish and mammoth sized apples; value add packaged products have been far less successful at penetrating global markets.     Don’t shout
October 8, 2015

Japan’s Otsuka makes bold preemptive strike of Spain’s Bicentury

Drug, OTC and Functional Food maker Otsuka Pharmaceutical has just bought over Spain’s Bicentury, a diet food business famous for its Sarialis brand. The purchase price has not been disclosed. Whilst not a major acquisition, sales of Bicentury are Euro35m, it is significant as Europe has not been a big priority. Over 80% of Otsuka’s global sales are in Japan and the USA. Equally important it signals the company’s ambitions in consumer focused nutraceutical businesses. Otsuka pharmaceutical is one of Japan’s larger pharma companies with an eclectic range of businesses. For many it is best known for its clever marketing of isotonic drink Pocari Sweat,  Nature’s Made supplements and soy cereal brand SoyJoy. Bicentury was a pioneer in the cereal bar business launching Sarialis in 1992 long before SoyJoy was conceived. Like many large Japanese companies, Otsuka

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