Made in Japan’ not so big in Japan

Made in Japan’ not so big in Japan

Wednesday, November 20, 2013 – 03:02

au Boon Lai, Japan Correspondent In Tokyo, The Straits Times

Mr Makoto Miyazaki swears by the made-in-Japan office furniture he sells at a store in Tokyo’s suburban ward of Taito. “They are better than the China-made ones as they are more solidly built,” he said. But despite his spirited attempts at explaining to customers why they should pay about 30 to 50 per cent more for a Japan-made cabinet, it is those that were made in China that fly off the shelves, leading to a three-month wait in some cases.It would not cheer Mr Miyazaki, who is in his 40s, to know he is not alone in facing this problem – a growing number of Japanese consumers are looking beyond products made here at home, separate surveys have shown.

Price was the overriding factor in buying decisions for 61 per cent of about 7,000 who responded to a survey by the Consumer Affairs Agency of Japan published in July.

Mr Nobuyuki Ota, executive managing director at Matsuya, a major department store in Tokyo, has a different take on the issue.

The problem, he said, is that sales staff are not doing enough to explain the merits of Japan-made goods to shoppers. “Sales staff generally just apologise… for the higher prices of goods in the department store when they should be explaining why the goods are better,” he said in an interview.

Retailers need to train their staff to emphasise the strong selling points of Japan-made goods, such as the better materials used, to show why they command higher prices, he added.

But the trend has been a few years in the making. The Ministry of Economy, Trade and Industry (Meti) warned in 2010 of the waning appeal of the kokusan, or locally made, labels in commanding higher prices.

Consumers who once bought only made-in-Japan appliances and products were not as particular any more, the ministry said in a report. Even food buyers, long seen as inured to the higher prices of Japanese-grown produce, are switching allegiance.

A survey by the Japan Meat Information Service Centre late last year revealed that more than 40 per cent of the respondents said affordability was key in buying chicken and pork, twice as many as the 20 per cent who placed Japan-produced meats first.

Concerns over the unending problems that followed the March 2011 earthquake and tsunami at the Fukushima nuclear plants have contributed to greater acceptance of foreign food imports, according to the survey.

But in an indication that consumers remain wary over China-made frozen dumplings that made many Japanese sick in 2007 and 2008, American and Brazilian meats gained greater acceptance.

Management consultancy McKinsey & Company traces the change in preferences to the 2008 financial crisis, when Japan went into recession and consumers started cutting back on expenses.

Housewife Yuriko Kohara, 32, however, thinks it goes back even further, to the recession after the 1997 Asian financial crisis, when Japanese casual wear chain Uniqlo started making waves with its cheaper China-made clothes.

Since it opened its first urban store in Tokyo in 1998, the chain has grown to almost 800 stores in Japan.

Many Japanese manufacturers also have factories overseas. But a more potent threat to kokusan products are the inroads into Japan made by overseas brands.

In an update on the home appliances market published in May, Meti noted that Japan-made products are losing their market share to brands such as China’s Haier and South Korea’s LG, whose appliances are well designed and are priced competitively.

Consumer behaviour analyst Koji Matsushita of Chuo University believes that the Internet has contributed to the trend.

Each month, more than 45 million visitors throng the kakaku.com website to compare prices and check out the ranking and their peers’ reviews of products ranging from computers and appliances to clothes, cars and food, before buying online or visiting the stores.

The ranking lists lend further credence to signs that price has become a priority.

Topping the laptop sales compiled by the website, for instance, is a China-made Lenovo, which, at less than 38,000 yen (S$473), is the cheapest of those on sale.

Even Mr Miyazaki, when asked if his support for made-in-Japan products applies to all his own purchases, ruefully admits that kokusan products are “a little on the expensive side”.