Japan’s Department Store Sales Recover, But Trail Other Retail Growth

Department store sales in 2023 increased 8.8% year on year to ¥5.42 trillion, according to the Japan Department Stores Association, marking the third consecutive year of growth. Sales are nearly back to the level just prior to the pandemic at just 5.8% lower than the total in 2019. Sales in 2024 from overseas tourists tripled over the previous year, reaching a record high of ¥348.4 billion.

Statistics from the association show that sales within the department store sector rose steadily throughout Japan’s period of high postwar growth in the 1950s and 1960s and then reached a peak in 1991, at the end of the bubble economy.

The composition of items sold at department stores has changed over time. Clothing accounted for over 40% of all sales in 1965 and 1991, while food sales were less than 20% of the total. However, by 2023, food was in the lead at 27.4%, followed by clothing at 26.9%. Another important segment in 2023 consists of general merchandise. This category, which includes jewelry, artwork, and cosmetics, is said to be popular among free-spending customers, whether wealthy Japanese or overseas tourists.

Despite its year-on-year increase in sales, department stores have undergone a remarkable decline compared to other retail categories. Statistics from the JDSA and the Ministry of Economy, Trade, and Industry comparing sales by retail category between 2013 and 2023 show that sales at department stores fell by 15%, as compared to increases of 17% and 22%, respectively, for supermarkets and convenience stores. Meanwhile, e-commerce sales shot up by 59% over the same decade.

(Translated from Japanese. Banner photo © Pixta.)