Daiso 100-yen-style shops start to blossom in Mideast

by Miya Tanaka

MANAMA (Kyodo) Ever since Bahrain resident Nader Mohammad heard from a friend about a “very good” shop that opened in the tiny Mideast state in 2005, he has become a fan of the Japanese variety store where almost every product is the same price.

“There are things which I don’t find in other shops. . . . I was happy to hear about a second shop opening near my house,” the 34-year-old Bahraini soldier said as he perused a selection of household items in The Daiso — the Bahrain branch of Japan’s leading “one-coin” store chain Daiso Industries Co.

Major Japanese trading firms first put down roots in the region and were followed by construction companies as development projects grew. Now small and midsize companies, including 100 yen shops and conveyor-belt sushi eateries, are making their entrance, according to Miho Shibata at the Japan External Trade Organization’s Overseas Research Department.

Known throughout Japan for selling a wide range of merchandise, each priced at 105 yen, Daiso has been stepping up its presence in the Middle East lately.

Under a franchise agreement with a local joint venture company, The Daiso — Japan’s #1 Value Store, opened in Dubai in 2004 as the first Daiso shop in the Middle East. As of May, Daiso had 15 shops across the United Arab Emirates, Qatar, Bahrain, Kuwait and Oman. About 10 more shops are to open by the end of the year, including in Saudi Arabia.

Sales at most of the shops in the Middle East have increased, but it has not been easy because of prices: its products are less of a bargain than they are back home.

“In Japan, 100 yen shops have an image as discount stores . . . but here the biggest problem is that our products are more expensive because they are imported from Japan,” said Tomoaki Fujimura, Daiso’s overseas store leader, currently visiting the Bahrain shop.

In the Bahrain store, most products sell for 600 fils, or about 180 yen. But considering that a canned beverage in Bahrain costs the equivalent of 30 yen, Daiso’s products are priced a little high for Bahrain, Fujimura said.

Offsetting this drawback is the “large selection” Daiso can offer, said Yuwa Watanabe, an official at Daiso headquarters in Hiroshima Prefecture, although he said it took a while for the local shops to understand the concept.

“Dropping products that don’t sell well is a common practice in retailing, but we don’t do that in order to maintain a level of variety that no other Middle East shops can offer. Plus, thanks to Sony and Toyota, Japanese products have an established image of high quality, which has also given us a boost,” he said.

In Japan, where Daiso outlets draw consumers who are looking to buy quality goods at rock-bottom prices, stores offer a staggering 90,000 items, ranging from kitchen utensils and cosmetics to stationery and interior goods. About 90 percent of these products are sold under the Daiso brand name.

Partly due to Islamic religious constraints, not all Daiso products find their way onto the shelves in the Middle East. For example, an interior item featuring Buddhist imagery cannot be sold in Kuwait because Islam bans idol worship, Fujimura said.

Around half the Japan product line is sold in shops in Dubai, and some 30,000 items are on sale in the 1,200-sq.-meter shop in Bahrain.

Customers range from the oil-rich who buy up everything on a shelf to expatriate workers who enjoy Daiso’s reasonable — though by no means bargain — prices, Fujimura said.

“It’s not cheap, but very nice,” said Nada Jamal, a 13-year-old Bahraini who was visiting the Bahrain shop with her father for the first time and eyeing up the cosmetics corner. “When Daddy comes, I’ll say I want this.”

Daiso is also trying to increase customer satisfaction by introducing Japanese-style displays and customer treatment, Fujimura said.

“We can’t simply rely on the good image of Japanese brands. So we attach importance to offering excellent displays and good service,” he said, adding shop clerks are taught to guide customers all the way to the products they are seeking — a practice often seen in shops in Japan but rare in Bahrain unless in exchange for a tip.

But sometimes attempts to provide “Japanese-style” services have backfired, said Fujimura, who has been visiting other Daiso shops in the Middle East to give them the benefit of his knowhow.

“We have tried saying ‘Irasshaimase’ (Welcome) when customers visit the shops, but this annoys some people. And in Kuwait, where there is fairly strict adherence to Islamic principles, I made a man angry when I was explaining to his wife how to use our products. I think he thought I was ogling her or something,” he said.

Popular products include refreshing foot patches for tired feet, laundry nets, gardening tools and cosmetics, Fujimura said.

As many of the products still carry their original Japanese labels, customers often ask the shop clerks what they are.

Mahesh Dewani, 37, from India and hired by the Dubai-based joint venture company Daiso (Japan) Value Store LLC, said the most difficult aspect of the job was familiarizing himself with the products, a task made more difficult by the language barrier.

“Now I have all the things in mind,” he smiled, but added that when he joined Daiso in 2004, he knew nothing about the company or what was expected of him.