U.S. retail-chain Wal-mart Stores will revise their "everyday low price" strategy at Seiyu supermarket in Japan. Seiyu's year-end loss in 2004 was 12.3 billion yen. The U.S. style low price selling did not appeal to Japanese consumers.
Wal-Mart bought a 6.1% share of the Seiyu company in 2002. At that time, Seiyu had lost money in 3 out of the previous 5 years. Wal-Mart introduced their "everyday low price" selling method to Seiyu, with lineup such as 900 yen fleece wear or jeans imported directly from China. Sales did not grow as expected, since consumers wanted a more varied range of products rather than just cheap prices. "We will adjust our bias to low priced items, and resume selling name-brand goods our customers like to see," says CEO Masao Kiuchi. Seiyu will go back to their previous way of marketing through inserted fliers showing the daily specials, quite the opposite of Wal-Mart way.
(The Nikkei)
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