Market share of electric appliance retailer

Japanese electric appliance market ups and downs!?

The market size of electric appliance retailers(stores) in Japan is about 5.3 trillion yen(about 53 billion dollars) according to the report of Nikkei Marketing Journal in 2017. This market was growing steadily from 2005 to 2010, but had ups and downs after 2011. This market's size increased in 2013 because of economy recovery, but it decreased in 2014 because of rasing the consumption tax. This market remained flat or decreased slightly for 10 years.

Japanese electric appliance retailers also face Amazon's expanding. They are selling electric appliances in own HP, but cannot stop Amazon because of its low price and assortment. Therefore, there has been progress in restructuring since 2000s. Bic Camera Inc. bought Kojima Co. in 2012, and it became the second largest electric appliance retailers in Japan. Yamada-Denki Co. which is the largest electric appliance retailers in Japan bought Best Denki in the same same year to comfront Bic Camera.

In addition, Japanese electric appliance retailers expand other industry related to electric appliances. Yamada-Denki bought SXL which was middle sized home buidler in 2011 and Housetech which was a housing equipment manufacturer in 2012. It opened furniture shop named "Interior Reform Yamada" in Gunma prefecture. In addition, it expanded financial services industry, and began handling of housing loan and remodeling loan in 2017.

Japanese electric appliance stores are classified into two types, urban-type store and suburban-type store. The former can draw many customers easily because of its location, the latter can have abundant assortment and wide parking. Yamada-Denki became the largest electric appliance retailers by opening suburban-type store. On the other hand, Bic Camera Inc. grew its sales and profit by opening urban-type store.

Yamada-Denki was established in 1978 by Noboru Yamada who worked at Victor(JVC). It achieved one trillion yen sales in 2005, and is the first electric appliance retailer which has one trillion yen sales. Its sales doubled only for five years in 2010. It has been growing by opening suburban-type stores, but it began to open a new stores named "LABI" near the stations, Shinjyuku, Ikebukuro, Shibuya and more. It has 935 directly maneged stores and about 11,000 franchise chain stores now.

Bic Camera started as discount camera shop in 1980 by Ryuji Arai. It expanded to sell various electric appliance several years later. It sells not only electric appliance but also alcoholic drinks, golf club, furnitures, bicycle, toys and more now. Bic Camera is well known for being proactive in tying up other industry company. It opened Bicqlo Shinjyuku in 2012 with Fast Retailing Co. which has UNIQLO. It opened Rakuten Bic in 2018 with Rakuten Inc. which is Japanese EC company.

The sales of Japanese electric appliance stores may decrease in the future because of Japanese aging society. However, some of them increase their sales by catching foreign travelrs in recent years. Yodobashi Camera in Akihabara has souvenir floor for foreign travelers. Their sales and profit will increase with diversifying their business and that.

Yamada-Denki(TYO:9831), Bic Camera(TYO:3048) and Edion(TYO:2730) are listed on the Tokyo Stock Exchange. Foreign investors can invest in only Yamada-Denki on NYSE by ADR(American Depositary Receipt). They can invest above three companies through many ETFs, iShares MSCI Japan ETF(EWJ), Wisdomtree Japan Hedged ETF(DXJ) and more. Many Japanese companies increase their sales and profit with weak yen. If investors want to hedge an impact of fluctuations in foregn exchange rates, they should invest currency hedged ETFs, Deutsche X-trackers MSCI Japan Currency-Hedged Equity Fund(DBJP) and iShares Currency Hedged MSCI Japan ETF(HEWJ).