News On Japan

How Walmart flopped in Japan, and elsewhere overseas

Nov 22 (Nikkei) - The overseas outlets of U.S. retail giant Walmart have been burdened by a jinx, the severity of which seems inversely proportional to their distance from the American mainland. In other words, the further away, the weaker their earnings.

This jinx was often mentioned by Walmart employees about 15 years ago when the world's biggest retailer retreated from Germany and South Korea. Whispers of the "jinx" resurfaced again after Walmart pulled out of Brazil in 2018 and Britain in 2020.

Walmart's foreign flops can be attributed largely to tone-deaf management, which failed to take into account local business customs, dietary habits and labor relations, among other glaring oversights.

In Japan, Walmart will sharply reduce its presence after struggling to match its operations -- primarily that of handling processed and frozen food products -- with those of the supermarket chain it acquired, Seiyu, which had traditionally been more reliant on perishables. The inability to figure out regional differences in the relatively compact country also played a big role in Walmart's failure.

When Seiyu directed procurement for regional operations to corporate headquarters in Tokyo, popular local items disappeared from shelves, resulting in customers fleeing the chain in droves.

Judith McKenna, CEO of Walmart International, put a somewhat happy spin on the chain's misfortunes in Japan, which culminated in the sale of its majority stake in Seiyu to U.S. investment company KKR and Japanese e-commerce major Rakuten. McKenna explained to Nikkei on Monday simply that Walmart had forged a business partnership with Japanese characteristics.

In other words, Walmart never managed to develop significant ties with local partners alone.

When Walmart clarified the division of duties at Seiyu, ostensibly to improve store efficiency, cooperation between workers disintegrated. During overnight restocking of shelves, for example, cardboard boxes were left in aisles as nighttime workers maintained they were not responsible for tidying up after their duties. Headquarters paid more attention to managers rather than rank-and-file employees.

Japan was the world's second-largest economy after the U.S. in 2002 when Walmart decided to invest in Seiyu. But the U.S. giant entered with neither an overall strategy nor in-store tactics to achieve much of a presence in a country faced with an aging population and declining purchasing power.

Walmart now aims to grow in China, India, South Africa and other emerging economies. The reason Walmart did not rid itself most of its Japanese business until now was partly because it has positioned the country as a steppingstone for pan-Asia aspirations. It also needed to save face. When Walmart considered leaving around 2010, the idea met with internal resistance, as a complete withdrawal would likely have made it impossible to advance into a developed economy again.

News On Japan
POPULAR NEWS

From April 1st, a new regulation took effect across Osaka Prefecture requiring all restaurants with a customer seating area larger than 30 square meters to become entirely smoke-free indoors—unless they install a designated smoking room. Establishments violating the rule face fines of up to 50,000 yen, while customers may be fined up to 30,000 yen.

The Imperial Household Agency launched an official YouTube channel on April 1st to introduce the activities of Emperor Naruhito and Empress Masako.

Japan's new fiscal year began on April 1st, with companies across the country holding entrance ceremonies to welcome new employees.

The Japanese government has released an updated damage forecast for a potential Nankai Trough megaquake, estimating that up to 298,000 people could die in the worst-case scenario. This projection reflects a slight reduction from the previous estimate of 332,000 deaths made 13 years ago.

The Japan Meteorological Agency announced on March 30th that cherry blossoms (Somei-Yoshino) in central Tokyo have reached full bloom, one day earlier than the historical average and five days earlier than last year.

MEDIA CHANNELS
         

MORE Society NEWS

A special unit dedicated to investigating "lone offenders"—individuals who commit acts of terrorism without belonging to any specific organization—has been established for the first time in Japan within the Public Security Bureau of the Tokyo Metropolitan Police Department.

Downtown, the popular comedy duo, has stepped down as official ambassadors for the Osaka-Kansai Expo, according to an announcement by the Japan Association for the 2025 World Exposition.

A tour bus carrying over 20 foreign tourists collided with a van inside the Tokiwa Tunnel on the Dōō Expressway on March 31st, sending several people to the hospital.

In August 1990, two men hiking in the Scottish Highlands captured a striking photo of a silent, diamond-shaped object hovering in the sky—later dubbed "the greatest UFO photo ever taken." A Harrier jet was seen circling the object before it suddenly shot straight up and vanished. (Abroad in Japan)

The Fukuoka Prefectural Police will introduce a new recruitment track for working adults starting next fiscal year, easing both age and physical fitness requirements as part of broader efforts to combat a worsening manpower shortage.

Children on spring break took part in a zazen meditation session at Toshoji Temple in Kiho, Mie Prefecture, on March 28th to help reset their daily routines.

A growing number of women in Japan are choosing men’s-style suits for both comfort and practicality, reflecting a broader shift toward genderless fashion. From school uniforms to police attire, traditional dress codes are evolving as functionality and diversity take center stage in work and daily life.

A temporary barrier has been installed under the iconic Glico sign in Osaka's bustling Minami district, commonly referred to as "Guri-shita," to prevent people from sitting and loitering in the area.