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Japan?s Retail Sales Surged 1.1% in March 2008
Jun 13, 2008

The Japan’s retail sector experienced growth in March 2008 with retail sales surged by 1.1% compared to the same month last year.

According to the Trade Ministry of Japan, retail sales jumped 1.1% in the world’s second largest economy during March 2008 as compared to the corresponding month in 2007, as reported by
IndiaInfoline.

The Ministry also revealed that the retail sales have been rising since August 2008, and rise in March was eighth in the row. Large retail outlets reported a rise of 0.2% in sales due to adjustments being done for change in store count. This was the second consecutive rise in sales of large retail outlets, and hiked 1.8% on adjusted basis. In contrast, retail sales spurred 3.2% during February 2008.

The retail sales in March 2008 were primarily driven by the organized retail sector. Moreover, exposure to overseas market and rising consumer income are anticipated to boost the retail sales in future. In the month of March, Japanese people spent heavily on fuel, food and luxury items, thereby filliping the retail sales.

Besides, expenditure on lifestyle and online shopping too substantially contributed in increasing the retail sales, as people excessively used retail banking facilities like credit card. Product quality awareness, best-in-class service by Japanese retailers, and willingness to try out new products too supported the retail sales.

Apart from natives, foreign tourists too led to the growth in the retail sales, as their number was higher than March 2007. Growth in the number of tourists pushed the sales of food, clothes, petrol and other essential commodities, leading to a boom in the Japanese retail market. Simultaneously, rising stock prices and higher salaries offered by employers to attract workers too prompted people to buy retail products.

Though the retail sales in Japan during March went up, yet it is facing some potential challenges, including price rise of food items and fuel, taking inflation graph to the decade’s highest level.

According to a Research Analyst at
RNCOS, “The March retail sales were greatly supported by the strong economic and financial conditions in the country. But inflation is the biggest issue that could halt growth of the retail sector. Hence, retail companies need to work out plans, for instance offering attractive and lucrative discounts, and free gift schemes, to attract customers.”

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