The 2020 Supermarket Annual Statistical Survey Report was released by the National Supermarket Association of Japan (NSAJ) last month based on a survey conducted on its members. NSAJ comprises over 200 members from all throughout the country, including Kinokuniya, Meidi-ya, Ito-Yokado and many more.
Based on the report, the majority of supermarkets participating in the survey will opt to increase their food products range and decrease non-foods moving forward, with processed and prepared foods leading this decision.
“50.6% of survey participants said they would opt to ‘increase the number of SKUs in the future’ for processed and prepared foods, followed by fruits and vegetables at 36.2%, meat and meat products at 35.4%, and seafood and seafood products at 35.1%,” said the report.
“[Along these lines], processed and prepared food products in participating supermarkets grew by the highest rate this year at 23.2%, followed by meat and meat products at 13.3%, seafood and seafood at 14.5%, and fruits and vegetables at 12.5%.
“[This was all positive growth as opposed to] non-food products which saw an 11.5% decrease - 20% of participants have said they intend to ‘reduce the number of SKUs’ of non-food products in the future.”
The home cooking trend in Japan is still in full swing, and this is expected to continue boosting the sales of fresh food products too. According to NSAJ, the fruits and vegetables sector is expected to continue seeing strong performance, calculated based on the diffusion index (DI) economic performance indicator, which is used to estimate market performance.
“The home cooking trend has continued to go from strength to strength, with potatoes and onions [particularly in demand],” said NSAJ in its Economic Trends Survey September/October 2020.
“The category saw a DI of 16, which is considered to be a strong performance – [other contributors to this include] vegetables for salads performing well in warmer areas, mushrooms, bananas, kiwifruits, grapes and so on.
“The meat and meat products category saw a DI of 12.7, also considered a good performance. This was also aided by high demand for foods for home cooking and reduced eating out – we saw that high-end products such as steak and yakiniku moved very quickly on weekends [and as the weather got colder] there was an increase in sales of ribs and chicken as hot pots became more popular.
“[A similar trend was seen for] seafood – sashimi such as tuna and salmon are doing particularly well as they can attract consumers easily price-wise due to lower market prices. [The category] saw a lower DI of 7.1, only moderately good, due to the poor supply of saury fish, [one of the most prominent autumn dishes in Japan], but some supermarkets are attempting to secure sales using other options such as autumn (chum) salmon, yellowtail, and Hamachi.”
Supermarket checkout plans
NSAJ also highlighted that the majority of Japanese supermarkets (64%) now have self-payment cash registers installed on the premises to enable easier cashing out by consumers, and many intend to either install or add machines in the near future.
“Some 88.2% of big supermarkets (those with over 50 stores) already have self-payment cash registers installed, and even 47.4% of smaller names (with one to three stores) have these too,” said the association.
Overall 13.1% of all surveyed companies want to install new machines, whereas 29.4% want to increase these numbers. Big supermarkets are still taking the lead in expanding usage at 53.3%, and understandably the smaller names are taking the lead in installing new machines (16.9%).
In addition, many companies are looking to install QR code payment as a transaction method moving forward. Japan is primarily a cash-based society – according to Deloitte Japan, about 80% of transactions are done via cash, and the QR code payment system is basically still in its infancy.
The Japanese government is looking to double the use of local cashless payments from 20% in 2016 to 40% in 2027 – given this and fears of cash as a COVID-19 spreading medium, it makes sense that many supermarkets are looking for options to support cashless.
“QR code payments topped the list of new payment methods that supermarkets intend to introduce in the future, at 28.6%,” said NSAJ.
“This was alongside an overall 43.7% of respondents saying that they ‘want to increase modes of payments other than cash’, with big companies leading this list at 57.6%.”