Isetan Mitsukoshi replacing CEO
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Japanese department store chain Isetan Mitsukoshi Holdings has appointed a new CEO as retailers battle to recover from a sharp fall in shopping spend by tourists.
In a filing with the Tokyo Stock Exchange, Isetan Mitsukoshi says senior managing executive officer Toshihiko Sugie will become CEO on April 1, replacing Hiroshi Ohnishi, who had been in the role since 2012.
Isetan Mitsukoshi says it made the change “to further improve corporate value by installing fresh management”.
Japanese department store sales fell to less than ¥6 trillion (US$52.70 billion) last year from a 1991 peak of ¥9.7 trillion, with retailers hit by weak economic growth, changing consumer tastes and e-commerce competition.
There was a brief boom when tourists, especially Chinese, were buying expensive items such as jewellery and watches. This has come to an end despite tourism numbers growing by 21.8 per cent to a record 25 million last year, according to the Japan National Tourism Organization. More than 70 per cent of tourists came from China, Hong Kong, South Korea and Taiwan.
Isetan Mitsukoshi says its duty-free sales fell 19 per cent to ¥36.7 billion over the nine months through December.
Questions & Answers
Q.What is the primary reason Isetan Mitsukoshi gave for changing its CEO?
What is the primary reason Isetan Mitsukoshi gave for changing its CEO?
Isetan Mitsukoshi stated the change was made to further improve corporate value. This aims to install fresh management and address current retail challenges, such as the fall in tourist spending and economic growth issues.
Q.How much did Japanese department store sales fall to last year from their peak?
How much did Japanese department store sales fall to last year from their peak?
Last year, Japanese department store sales fell to less than ¥6 trillion. This is a significant drop from their 1991 peak of ¥9.7 trillion, reflecting broader challenges in the retail sector.
Q.Why has the brief boom in tourist spending at department stores ended?
Why has the brief boom in tourist spending at department stores ended?
The brief boom in tourist spending has ended, despite a record increase in overall tourism numbers. This suggests tourists are no longer buying expensive items like jewellery and watches as they once did.
Q.What was the decline in Isetan Mitsukoshi's duty-free sales over the nine months through December?
What was the decline in Isetan Mitsukoshi's duty-free sales over the nine months through December?
Isetan Mitsukoshi's duty-free sales fell by 19 per cent over the nine months through December. This amounted to ¥36.7 billion, highlighting the impact of reduced tourist spending on luxury items.
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