On May 25, Yamada Denki Co., the largest home electronics retailer in Japan, announced that it would be closing 46 outlets. Given that the stores had been losing money for at least a year and Yamada operates more than 1,000, the announcement wasn't surprising, though the swiftness of its actions was. The targeted stores were shuttered a week later.
NHK visited a store in Tokyo's Koto Ward three days after the announcement and found hundreds of banners advertising a closing sale with Yamada's already low prices slashed by up to 50 percent. One employee told the reporter that he had only learned about the store's closing less than a week earlier, and expressed anxiety over where he would be transferred. A woman who lived nearby said it would be an inconvenience since the store not only sold electronics at a discount, but also inexpensive food and sundries.
Why the big hurry? Like all retailers in Japan, Yamada expected some fall-off in sales following last year's consumption tax hike, but it didn't expect it to be as steep at 12 percent compared to the previous year. More significantly, Yamada's business profits declined by 42 percent, and not just due to the effect of the tax hike or last summer's unstable weather, which was seen to have stunted consumption. Yamada acknowledged that the country's population is shrinking, especially among its target demographic, and that it had to review its policy, which since the early '90s was based on one thing only: expansion.