Slices of Japanese business, politics and life
The president of Aeon bristles at the suggestion that he’s partly the reason for deflation in Japan, as the country’s No.2 retailer and its rivals slash prices to snag yen-pinching shoppers.
“It’s stupid. They don’t know anything,” Motoya Okada told a group of reporters, when asked about a recent magazine article that criticised Aeon, budget fashion chain Uniqlo and other retailers for a price war that, the story argues, only hurts the economy by squeezing profits and wages.
“Japanese people are getting poorer and poorer. Unless their incomes rise, there’s nothing they can do about it,” said Okada, whose company has been marking down prices sharply to reinvigorate sales at its Jusco supermarkets and other general merchandising stores — all-in-one stores that sell everything from food to clothing to electronics.
Expressing frustration with accusations that he’s partly responsible for deflation, Okada reminisced about the good old days of barbecued eel, a traditional Japanese delicacy.
Japanese retailers reported mostly dismal first-half earnings results, with the industry stuck in a slump as shoppers remain reluctant to open their wallets even as the economy emerges from recession.
Japan is back in deflation, and price falls look like gathering pace as shoppers’ bargain-hunting leads stores to cut prices further to weather the worst retail slump in decades.
Retailers large and small reported hard falls in quarterly profits last week, and the few bright spots were focused on those drawing in thrifty shoppers with their cheap but well-made goods.