Tesco Gives Up On Japan

[Mulboyne]

[floatl][/floatl]Bloomberg: Tesco Plans to Sell 129-Store Japanese Unit on Lack of Scale
Tesco Plc, Britain's largest retailer, plans to sell its 129-store Japanese unit because it cannot build a "sufficiently scalable business" there eight years after entering the market. The stores will remain open during the sale process, the Cheshunt, England-based grocer said in a statement today. Same- store sales in Japan fell 6.4 percent in the first quarter, making it Tesco's worst-performing business in the period. The division, which includes the Tsurakame, Tesco and Tesco Express formats, is Tesco's smallest international retail business and just over half the stores are profitable. The retailer has invested 100 million pounds ($163 million) there since 2004..."What we thought we'd be able to do is take our Express format and our small supermarket format and grow it in the Tokyo area," Clarke told journalists on a conference call. "Unfortunately its proven to be very difficult to shift consumers from the stores that they use into new ones," he said. "It was more about our difficulty in getting scale because you're competing with some extremely large Japanese retailers," the CEO added. The company has less than half of one percent of Tokyo's market share, where it employs just under 4,000 staff. "We are tiny," he said...more...

FG member Doctor Stop predicted this withdrawal as soon as Tesco began rolling out their convenience store format.

[Mulboyne]

The Telegraph turns to an FG for insights:

The news that Tesco is to sell off its 129-store operation in Japan comes as little surprise to Anton Lloyd-Williams, who has watched the world's third largest retailer enter and now exit the East Asian island nation...Lloyd-Williams, manager of an IT department in a Japanese polytechnic, came to the same conclusion eight years ago, just after the first store opened back in 2003 under the Tsurakame brand. He said: "We went along hoping it would be like an English Tesco and that we would be able to stock up on English items, but apart from a few things it was mainly an enlarged version of a Japanese convenience store and that, I think, was the problem. "When it arrived no one had heard of the brand and, by setting itself up as a Japanese supermarket, it just became another one of many and brought nothing new to an already developed scene." There are estimated to be 17,000 Britons in Japan, the majority living in and around Tokyo.

[xenomorph42]

The Telegraph turns to an FG for insights:

Costco was like that. In the beginning they had a lot of things we just couldn't get in this country, now Costco is more or less an oversized Japanese supermarket. I gave up once they got rid of the Apple pies, that did it for me.
In Korea, Costco manages to balance both Korean and American products, but for some reason, Japan takes everything to the extreme massively changing everything.

[IparryU]

Costco was like that. In the beginning they had a lot of things we just couldn't get in this country, now Costco is more or less an oversized Japanese supermarket. I gave up once they got rid of the Apple pies, that did it for me.
In Korea, Costco manages to balance both Korean and American products, but for some reason, Japan takes everything to the extreme massively changing everything.

that is why japanese people think that dominoze, pizza hut, adidas, 7/11, am/pm are japanese...

now imagine.. what would japland be like if 7/11 and am/pm put a lil USofA back in them?
like:
40oz of malt liquor
slurpies.... yahhhhh buddy
swishers
condoms
plastic bottles of wiskey, vodka, and jin...

[damn name]

I thought 7-11 was a Japanese-owned company?

[matsuki]

Costco was like that. In the beginning they had a lot of things we just couldn't get in this country, now Costco is more or less an oversized Japanese supermarket. I gave up once they got rid of the Apple pies, that did it for me.
In Korea, Costco manages to balance both Korean and American products, but for some reason, Japan takes everything to the extreme massively changing everything.

Costco could definitely use more US products but it still beats the pants off of regular J-supaaaaaaaaaaaazzzzz

[Netherlander]

Costco was like that. In the beginning they had a lot of things we just couldn't get in this country, now Costco is more or less an oversized Japanese supermarket. I gave up once they got rid of the Apple pies, that did it for me.

OMG! That's exactly the same thing I told my J-friend last month when I was asked why I don't go there anymore. Costco doesn't sell the delicious big apple pies anymore and they seem to mostly sell lots of Japanese stuff in bulk. What's the point. Also recently the local super market seems to have a lot of the import products too. Although it's a bit more expensive.

[Samurai_Jerk]

OMG! That's exactly the same thing I told my J-friend last month when I was asked why I don't go there anymore. Costco doesn't sell the delicious big apple pies anymore and they seem to mostly sell lots of Japanese stuff in bulk. What's the point. Also recently the local super market seems to have a lot of the import products too. Although it's a bit more expensive.

Costco is only worthwhile if you have a car and a family. Otherwise I can get everything I need in Central Tokyo.

[IparryU]

Costco is only worthwhile if you have a car and a family. Otherwise I can get everything I need in Central Tokyo.

true that...

but when i do go to costco i get the following:
skippy penut butter
tortillas (they still suck)
cholula
blt rolls
cheese pizza
a bottle of JD
boxers
socks

[Taro Toporific]

but when i do go to costco i get the following:
skippy peanut butter
tortillas (they still suck)
cholula
blt rolls
cheese pizza
a bottle of JD
boxers
socks

You forgot the TACO CHIPS in a 4-lbs pkg as well as SALSA and REFRIED BEANS by the gallon!

[Doctor Stop]

FG member Doctor Stop predicted this withdrawal as soon as Tesco began rolling out their convenience store format.

Tesco poorly filled a niche that didn't exist and therefore didn't even need to be filled. I went to one twice and didn't see any reason for myself or anyone else to go to one again. They would have saved themselves a lot of money if they had just asked me, or better yet, hired me as a consultant.

[matsuki]

Tortilla chips
Alcohol
Drinks
Detergent
Toilet paper (why pay more and have to drag a 12 pk home twice more when you can get 36 for less in one shot?)
Tissue
Muffins (love their muffins....mmmm)
Shampoo/Conditioner/Hand and Body Soap (what's the point of paying slighly less for an odd amount "refill" when you can buy by the liter and pay less?)
Etc. Etc. Etc.

I dunno, I go there once every couple months with a friend that has a car. We split the membership fee and usually end up splitting up alot of what we buy (who needs 3 bottles of ketchup?) that doesn't really need stocking up on but is cheaper in bulk. Even if the costs were the same, it's worth having some stuff in bulk so that you're not having to carry back so much with you when you hit up your local super....and if you've ever thrown a weekend BBQ, you know Costco will have you covered in one trip.

[Doctor Stop]

I gave up once they got rid of the Apple pies, that did it for me.

I was surprised when they got rid of the apple pies too. That day I was buying a bunch of stuff for a BBQ and there were no pies.

[Coligny]

Tortilla chips
Alcohol
Drinks
Detergent
Toilet paper (why pay more and have to drag a 12 pk home twice more when you can get 36 for less in one shot?)
Tissue
Muffins (love their muffins....mmmm)
Shampoo/Conditioner/Hand and Body Soap (what's the point of paying slighly less for an odd amount "refill" when you can buy by the liter and pay less?)
Etc. Etc. Etc.

I dunno, I go there once every couple months with a friend that has a car. We split the membership fee and usually end up splitting up alot of what we buy (who needs 3 bottles of ketchup?) that doesn't really need stocking up on but is cheaper in bulk. Even if the costs were the same, it's worth having some stuff in bulk so that you're not having to carry back so much with you when you hit up your local super....and if you've ever thrown a weekend BBQ, you know Costco will have you covered in one trip.

In the bush I have Yamanaka... all the fancy import stuff... even sometimes Nutella... they sell beer in aluminum barrels... (can't remember the fancy name), sake and Weesky in 5 liters bottles... good stuff... the fancy european bubbly water (italian or french) is 98 yens per 1.2 liter bottle... UNBEATABUL... I always drive back from there with a low rider car... hopefully it's only downhill road...

[CrankyBastard]

For my needs, Costco's good for olives, cheese and wine.
Most everything else they sell can be got for pretty much the same price at ItoYokado.

[Samurai_Jerk]

For my needs, Costco's good for olives, cheese and wine.
Most everything else they sell can be got for pretty much the same price at ItoYokado.

And for me it's not even worth going for those things since it takes me more than an hour to get to the nearest Costco.

[legion]

The difference between Tesco and Walmart in Japan is advertising

(Walmart own Seiyu, Sunny and Livin)

[matsuki]

The difference between Tesco and Walmart in Japan is advertising

(Walmart own Seiyu, Sunny and Livin)

Yeah, it's always odd when you see Walmart "eco bags" and registers when you go there...

[Mulboyne]

The difference between Tesco and Walmart in Japan is advertising

(Walmart own Seiyu, Sunny and Livin)

The difference is scale. Japan is a major market but not a growth market. New entrants need to have a new concept in existing segments, find a new niche, or stake out a chunk of existing territory. Wal-Mart has taken the last route. Tesco thought that their convenience store format could work in a market full of convenience stores. Since they weren't offering any major differentiation, they realized they needed substantially more stores - probably at least ten times. That would require a big upfront investment. They aren't short of cash but their forecasts for projected returns couldn't justify it. They made their original purchase when sterling was nearly twice as strong against the yen. Yen losses are more painful and new investment more expensive, while the proceeds of a trade sale look more attractive.

[Jack]

Costco... mostly sell lots of Japanese stuff in bulk. What's the point.

The fucking moronic index is off the charts on this board. Hello people, is there anyone with anything that resembles brains in here?

"Costco sells mostly lots of Japanese stuff..." (IN JAPAN). Go figure.

[Coligny]

The fucking moronic index is off the charts on this board. Hello people, is there anyone with anything that resembles brains in here?

"Costco sells mostly lots of Japanese stuff..." (IN JAPAN). Go figure.

Once again: Fuck you Jack...

[Bucky]

[Christoff]

No aussie pies?

[Doctor Stop]

They opened a "flagship" store in Bum Fuck Machida and then closed it down in short order.

Carrefour, in the same mall, disappeared at about the same pace.

[Mulboyne]

[nikoneko]

and REFRIED BEANS by the gallon!

Do they still have these at the Costco you go to? Would kill if they had them here. I can make just about anything Mexican from scratch at this point, even tamales, but just can't get refried beans right as simple as they seem. Costco was the only place to buy them for less than \300 a can..

[Christoff]

Do they still have these at the Costco you go to? Would kill if they had them here. I can make just about anything Mexican from scratch at this point, even tamales, but just can't get refried beans right as simple as they seem. Costco was the only place to buy them for less than \300 a can..

pinto beans, water, salt, lard & emersion blender

[nikoneko]

Yeah, I either get the spices wrong and they are too bland and/or they are lumpy due to not having an emersion blender or food processor (wife won't allow because of space). Just made a batch of chile verde last night though so may try again today actually.

[Samurai_Jerk]

wife won't allow because of space.

Whenever I ready shit like this it makes me laugh.

If your wife won't allow you to spend 3 million yen on a new Harley Davidson because you don't make enough money to justify it, fair enough. If your wife won't let you buy a blender, fucking ridiculous. The fact that you would listen, even more ridiculous.

[nikoneko]

Hah I almost edited that cause I knew someone would reply about it, I agree with her, the cabinets are full and we'd use it like a few times a year. If I really thought we needed it I'd manipulate her into thinking the same, as any good husband does.