Strategies

Last updated on May 16, 2016

Building New Department Store Business Model

J. Front Retailing is building a new department store business model to strengthen market response capabilities and realize a structural switch to low-cost operation.

The new department store model is a department store renewal program to create attractive and profitable stores that entice customers to visit. Specifically, we are working on (1) expanding target customer base, (2) widening the product range, and in particular, the price range, (3) developing specialty zones, and (4) increasing management efficiency, as well as maintaining and strengthening the middle to high-end product offerings in which department stores have traditionally been strong, while clarifying and thoroughly implementing store strategy in each store, in a bid to adapt to major market changes including the consumer shift to more casual lifestyles and more frugal and price-sensitive behavior.

Daimaru Tokyo store
Daimaru Tokyo store

On October 5, 2012, Daimaru Tokyo store, which represents the new model, increased its floor space by 1.4 times to 46,000 square meters and celebrated its phase II expansion and grand opening. On the occasion of its full opening in the second phase, adopting the achievements and know-how gained from our past efforts including store planning and operations, and, as a store located at Tokyo station, targeting various customers ranging from female office workers and businessmen around the store, business travelers and tourists to residents nearby and in the suburb who purposely visit the store by train or car, the store has a wide lineup of luxury brands and select shops that are new to the store and brands and shops that attract many customers, including Tokyu Hands and ICI Ishii Sports, with the store concept of “department store with assortment of ‘current’ Tokyo,” while further strengthening already strong food products, mainly boxed lunches and sweets, both in quality and quantity. Thus the store became distinctively strong in gift items, souvenirs and traveling gear.

Matsuzakaya Nagoya store has undergone major renovations for two years since spring 2012. In the first phase in fiscal 2012, we renewed the first and second floors, which serve as the face of the department store. In the south wing, the Ufufu Girls zone was created on the second floor and selected women’s fashion items were brought together and Chubu region’s first H&M shop, which is one of the biggest in Japan, was newly opened on the first floor. In the main building, cosmetics, women’s furnishings and accessories sections on the first floor were refurbished and special selections on the second floor were reorganized by adding new brands. In the second phase in fiscal 2013, the first and second basement food floors were fully renovated to cap the renovations. Aiming to develop Nagoya’s number-one food zone, we introduced many Japan’s or Nagoya’s first popular shops while creating a specialty zone named Table Plus. And phase III renovation from spring 2015 to spring 2016 includes the redesigning of women’s shoes and bags departments, the introduction of Yodobashi Camera as a new category and the creation of larger men’s floors named Matsuzakaya Genta in the north wing. These phase I to III major renovations have attracted more customer traffic and a wider range of customers.

Matsuzakaya Nagoya store
Matsuzakaya Nagoya store

We will adopt these achievements in other Daimaru and Matsuzakaya stores to make them more competitive in each area.

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