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The distribution revolution

11 4 0

HIKONE, SHIGA PREF. - The domestic market for internet shopping has been growing steadily at an annual rate of nearly 10 percent, according to a survey released last year by the Ministry of Economy, Trade and Industry. In fiscal 2017, Japan’s online shopping market reached ¥16.5 trillion, accounting for 5.79 percent of total household spending. Since the ratio has already passed 10 percent in such countries as Britain, China and the United States, the size of the Japanese market is likely to double over the next several years.

Online shopping is attractive to consumers since the prices are relatively low, the goods are quickly delivered to the designated places and there are no additional cost for credit card payments. In addition, there is a large variety of merchandise for customers to choose from, and a premium member of Amazon Japan can enjoy free delivery by paying annual dues of ¥3,900.

Sellers enjoy the following benefits: A sharp saving on rent and labor costs since they don’t need a physical store; they can attract customers to fast-selling commodities based on their past purchase histories; and inventory stocking becomes unnecessary for big e-commerce companies like Rakuten Inc., which have large numbers of virtual shops operating on their platforms.

There is no doubt that the e-commerce market will expand further with the exception of fresh foodstuffs. Following the abolition in 1998 of the law regulating large-scale retail stores, many small stores on........

© The Japan Times