TOKYO — Retail sales in Japan were mixed in August as department stores continued to suffer from a lack of international shoppers and a heat wave, while some retailers began a slow recovery. However, the largest single-quarter drop in GDP ever recorded signaled that the economy overall remains in a poor state.
Japan’s Cabinet Office said Tuesday that the country’s real gross domestic product for the April-through-June quarter was even worse than had been expected, dropping by 28.1 percent on an annualized basis. This marked the worst negative growth in the country’s recorded history. During the financial crisis of 2009, the lowest point came in the January through March quarter, when real GDP fell by 17.8 percent.
Fast Retailing reported same-store sales among its Uniqlo stores in Japan increased by 29.8 percent on the year last month. Customer numbers were up by 26 percent, and the average purchase per customer grew by 3 percent.
“Same-store sales increased sharply year-on-year in August as the record-setting summer heatwave generated strong sales of Airism products, UT T-shirts, and other core summer ranges, and our products designed to satisfy stay-at-home demand and our Airism masks proved popular,” Fast Retailing said.
As of the end of August, six Uniqlo stores in Japan remained temporarily closed and 91 others were operating with reduced hours due to the coronavirus pandemic. Those stores were not excluded from the same-store sales calculations.
Fast Retailing permanently closed two of its Uniqlo stores in Japan last month and had no new openings, bringing the total number of stores in the country to 764.
Isetan Mitsukoshi Holdings said that same-store sales from its five stores in the Tokyo metropolitan area were down by 29.1 percent in August versus a hear ago. The Mitsukoshi store in Tokyo’s Ginza district, which was a popular shopping area for foreign tourists before the onset of the pandemic, saw its sales drop by 47.8 percent, the largest decline by any of the retailer’s individual department stores.
Takashimaya, another department store operator, said that August sales from its 13 stores in Japan contracted by 18.8 percent compared with the same month last year. Only two individual stores saw their sales increase, and they are not located in major city centers. In Tokyo, Takashimaya Shinjuku’s sales decreased by 27.9 percent, while the store in the Nihonbashi district experienced a drop of 13.6 percent.
“In addition to a drastic decline in tax-free sales, the effects of a heatwave and the continuing trend of people refraining from going out resulted in not being able to meet the sales levels of last year,” Takashimaya said. “On the other hand, we did see movement of items meant to make people’s time spent at home more comfortable, as well as of luxury brand goods.”
H2O Retailing Corp., which operates the Hankyu and Hanshin chains of department stores, said that sales from those stores in Japan were down by 15 percent on the year last month. Same-store sales declined by 26.9 percent. Sales to international travelers to Japan dropped by 87 percent, however the company’s e-commerce sales nearly tripled compared with August of last year.
“Because of the tendency to stay at home due to a sudden rise in the number of people infected by the novel coronavirus starting from the end of July, as well as the effects of the intense heat, even after summer vacation started we saw a drastic reduction in the number of customers to our stores, particularly in the city centers,” H2O noted.
J. Front Retailing said that sales from its 16 Daimaru and Matsuzakaya department stores in Japan declined by 29.4 percent year on year in August. Each of the individual stores saw a decrease in sales, with the largest coming from those in city centers. Sales from the Daimaru store in Osaka’s Shinsaibashi district were down by 53.2 percent, while sales from the Daimaru Tokyo store declined by 48.5 percent.
“Sales of volume fashions and food products in particular suffered,” J. Front added.