In the “Blessed Land” Chengdu, Ito Yokado could not escape the final outcome of closing the store

Reporter | Zhao Xiaojuan

Editor | Ya Han Xiang

On October 28, Ito Yokado, which has been operating in Chengdu’s Chunxi business district for 25 years, started its countdown to closing its store.

A “Supplier Notification Letter” printed with the official seal of “Chengdu Ito Yokado Co., Ltd.” shows that after receiving the notice from the owner, the property leasing service will be terminated, and Chengdu Ito Yokado Chunxi Store will be terminated after December 31 this year. operate.

Jiemian News called Ito Yokado Chunxi Store in this regard, and the relevant personnel said that they have not yet been notified of the closure of the store. However, according to a report from Linkshang.com, Chengdu Ito Yokado confirmed that the above news is true, and the reason for the closure of the business was that there was no agreement on the renewal of the contract with the property owner Lidu Plaza.

The contract, which is not renewed, marks the end of the Japanese retailer’s first store in China.

In fact, Ito-Yokado has closed from more than 10 stores to the last one in the Beijing market. Although it used to be an iconic business symbol and shopping destination in Chengdu, it is now unable to escape the iterative replacement of consumption trends. People on Chunxi Road have already flocked to Taikoo Li and IFS, and brands are more willing to try more new models in these places, or open their first stores in the southwest.

This kind of attempt also allows the owners of Chunxi Road to enjoy some location advantage dividends. For example, Parkson Shopping Plaza on Chunxi Road has introduced the first store of Japanese lifestyle collection store niko and… in the southwest region. For owners, this kind of more trendy brand and retail experience may activate the flow of people in the entire commercial project, and the appeal of Ito-Yokado may not be what it used to be.

From this point of view, Lido Plaza may prefer to introduce new formats to form a resonance with the surrounding business district, rather than retaining the more traditional Japanese-style retail form such as Ito-Yokado.

niko and… Chunxi Road Parkson Shopping Plaza Store

Ito-Yokado has indeed been out of touch with the times.

It is a “hundred-year-old store” from Japan – its predecessor was founded in 1920. Its founder Masahiro Ito explored the Japanese-style GMS model of “supermarket + department store” during more than 30 years of development, and opened it in Japan in 1972. Listed on the Tokyo Stock Exchange.

In 1991, Ito-Yokado acquired a 73% stake in the American Southern Company, a company owned by the convenience store brand “7-ELEVEN”. Changed its name to Seven & I Holdings (Chinese name “Seven & I Holdings Group”).

According to Deloitte’s “2022 Global Retail Power”, Seven and Yi Holdings ranked 19th with a revenue of US$52.317 billion (about 378.9 billion yuan).

Ito-Yokado entered the Chinese market in 1997. Ito-Yokado has established joint ventures in Chengdu and Beijing successively, and opened Ito-Yokado in Chengdu and Kado shopping mall in Beijing.

Chengdu Ito-Yokado is located on Chunxi Road, Chengdu. This is a typical Japanese-style GMS hypermarket, that is, the ground floor is a self-operated food life hall (fresh food supermarket), and the upper floor is a department store. Among them, there are a large number of Ito-Yokado’s own brands in the department store category.

This kind of supermarket and department store integrated, Japanese-style service features in Chengdu at that time differentiated it from retailers such as Wal-Mart and Carrefour, making Ito-Yokado Chunxi Road Store, which is positioned as a boutique store, quickly become a landmark shopping center. In 2012, the annual turnover of Ito Yokado’s four stores in Chengdu ranked first, second, third and fifth in the world, including the Chunxi Road store.

The biggest influence of Ito-Yokado on Chinese retailers lies in its advanced business philosophy and refined operation and management experience. For example, private brand development experience, store display and management details are the objects that most retailers learn and imitate.

However, with the rise of shopping malls and online shopping, the integrated retail model of supermarkets and department stores no longer attracts young people. The Chunxi Road business district in Chengdu has been diverted by Taikoo Li, IFS, etc. to divert a large number of young customers, and the Chunxi Road store is no longer available. It is the most desirable shopping place for young people.

Since the three-year epidemic, the passenger flow of hypermarkets has further declined. According to the “2021 Performance List of Chengdu’s Major Commercial Complexes and Shopping Centers” released by the Sichuan Chain Business Association, Ito Shuangnan store ranked 18th with sales of 1.47 billion yuan (15th in 2020), but Ito Chun The Xilu store did not appear on the list.

Also, unlike other retailers, Ito-Yokado’s growth in China has been extremely slow. From 1997 to 2012, Ito-Yokado had only 8 stores in Sichuan, and by 2022, only 3 stores will be added in the 10 years in between.

In 2019, Huang Yamei, the general representative of Ito-Yokado in China, said in an interview with the media that the short-term goal of Chengdu Ito-Yokado is to reach 20 stores and a sales scale of 10 billion by 2022.

But as of now, Ito-Yokado has 12 stores in China. If the Chunxi Road store is closed, there will be 11 stores left. Ito-Yokado has changed the above goals to, while cultivating the southwestern market centered on Chengdu, and strive to open 9 stores in Beijing by 2030.