Talk about a crazy idea: A big-box American retailer seeks to enter a market where customers value precision and sophistication in their shopping experience. For consumers accustomed to bespoke service and refined packaging, the chain lets shoppers find their own way around its warehouse-like spaces and expects them to bring their own bags. In a country where savvy urban consumers tend to live in cramped homes located inside tightly compressed retail zones, the company sets itself up in suburban areas away from mass transit, offering bulk items that have a hard time making it through the front door, let alone into a standard-size refrigerator.
And yet, Costco's foray into Japan has been an unqualified success. Starting with a single shop in Shizuoka in 1999, the chain has spread to 18 cities from up in Sapporo to down in Kita-Kyushu. During the past year and a half, it has added locations in Tsukuba, Hiroshima and Kobe.
"It's like a theme park that offers a unique space for adults," says Chihiro Hayashida, one of Costco's most prominent enthusiasts in Japan. "They sell good-quality items at a low price, which makes for great value."