Japan Buyer s Interview

Transcription

1 We want to partner with companies that will honestly understand our principles and approach Ito-Yokado Co., Ltd. has currently 176 stores in Japan with revenue of JPY1.4 trillion. As a general supermarket, it serves communities as a center for people's everyday lives, and has won enormous confidence from consumers throughout Japan. We recently had an interview with Ms. Yuki Fujita, Manager in the Overseas Marketing Section, Food Merchandising Division of Ito-Yokado. Fujita had two years of experience of sales in stores before working in direct imports since She has been responsible for vegetable-related products in the areas of agricultural and marine products, and is now in a position, as manager, to see the whole range of products. She also has the title of "wine advisor". Q: What do you do to find new import products? The first thing is to gather information at Foodex and the other shows. We also go regularly to Anuga and other major shows. There are staff posted overseas in Seattle, Paris, Shanghai, Hong Kong, and Qingdao. We also have contracted employees in Taiwan, and we collect information from them. The third thing is direct sales approaches from production regions. Q: What are your criteria for product selection? For foods, the first thing is the balance of flavor, freshness and price, but we also give the same level of emphasis to safety and confidence in the food. Ito-Yokado strives to ensure the safety of the fresh vegetables and prepared food raw materials that we import directly. Examples include bamboos shoots and yakitori skewered meat. For imported fresh vegetables, buying is conditional on being able to confirm locations and methods of production. We perform pesticide residue testing locally, in the producer country, as well as periodically in storage warehouses in Japan. For imported raw materials for prepared foods, we are building a traceability system that manages production regions and distribution history. For example, for processed foods such as yakitori using 1

2 Chinese-produced chicken, we specify the source poultry farms and check the feed and the drugs used at each farm. We are also building a system that will allow us to manage "when was it raised, on what poultry farm, and what truck was it carried on" for each product, in single lot units. Our locally-posted staff and buyers periodically check production conditions on site at each poultry farm. What is important in choosing products is that we want to partner with companies that will honestly understand our principles and approach, as I described it earlier. Q: What attributes of counterpart companies do you see as most important? The company has to be sincere. Our criterion for judging whether a company is sincere is to watch, when a problem occurs, whether they have an honest attitude, without concealment, and how sincerely they tackle the problem. Mistakes do happen, there's no way around it, so we watch for a sincere response when they do. We investigate in advance whether a supplier has any record of exporting to Japan, what kinds of Japanese company it has worked with, and so on. In some cases, we conduct a credit check on the company. Problems can arise during negotiations, but we tackle those by considering how to deepen mutual understanding. Q: What kinds of imports do you handle at present? Processed meat products (both frozen and chilled), such as yakitori and chilled pork, processed agricultural products (both frozen and chilled), such as frozen corn, bamboo shoots, and menma (fermented bamboo shoots), marine products (frozen) such as shrimp and scallops, and processed foods such as pasta and vermicelli. Thailand is our main source country, followed by China, and then America, Vietnam, Taiwan, South Korea and others. If we do not have any staff posted in the country, we cannot immediately be on the spot when a problem occurs, so we are cautious about what countries we do business in. The balance between Ito-Yokado's direct imports and business through trading partners is that direct imports are around 1.5% at present. Direct imports are tough because we have to manage everything. Therefore, the products we import directly are those we are strongly interested in as a company, which have value for us even if we run risks, and will yield profits. They must be delicious, safe, and trustworthy, and also profitable. In the case of direct imports, we frequently visit processing factories to make checks for quality control. 2

3 Q: What are your best-selling items and popular products, including those imports? The majority of our direct imports are of ingredients for prepared foods. We raise their processing level overseas, import in bulk, perform final processing in the kitchens of our stores, and provide our customers with freshly-prepared foods. We import nearly 1,500 tons of yakitori per year, and it is one of our core items. Raw materials such as bamboo shoots and shrimp for prepared foods are widely applicable, and are used in diverse forms, such as salads, boiled foods, bento lunch boxes, and the like. Q: Why do those sell well, and what are the trends in consumption? Our analysis is that they sell well because all our foods, including fresh produce, taste good, they are safe and dependable, and are provided to customers at affordable prices. Q: How do you normally decide transaction terms? Our main payment method is L/C. We may use money transfers and D/P for some transactions. Transaction terms are CFR. Q: What are the biggest problems and barriers to bilateral imports? What problems occur with your import sources? Under-developed infrastructure is one problem. For example, there are variations in diligence in factory sanitation management, and it is a tough job to make suppliers understand what is expected in Japan. Next, there is language. There are limits to how far English will be usable. Third, there are geographical disadvantages, such as the lack of posted staff. It takes time to get anything done. In my experience so far, it is easy to get things done if the company president is serious. The size of the company is important, but I think a lot of small and medium companies perform well too. 3

4 Q: And what are the problems on the Japanese side? In the world market, I get the feeling that Japan misses out on good deals. I mean, compared to the high quality that Japan demands, we have to set low prices because of the slump in domestic consumption. The world maintains the minimum level of quality and buys at high prices. As a result, suppliers gravitate to the latter. Q: Are there any countries that currently interest you, or items you want to handle? We have almost no South American products now. Economic partnership agreements are progressing, so we want to make the most of such advantages and handle processed livestock, agricultural and marine produce. We would also like to handle highly-processed frozen foods, using the infrastructure of North American and European countries. Q: Finally, can you give us a profile or a PR description of your company? A supermarket that supports its customers' diets needs to go beyond a rich lineup at reasonable prices, and apply thorough quality control to make sure the food is safe and can be used with peace of mind. Ito-Yokado exhaustively checks the raw materials, freshness and other qualities of all the foods on the shelves, at every stage from purchasing to stocking in the stores and while they are on sale. When we make contracts with suppliers, we confirm that all raw materials and additives used comply with our quality standards, by demanding submission of testing and analysis certificates for each individual product. When we start dealing with a new product, we demand submission of a trading application, we make on-site inspections of source factories when necessary (including those overseas), and confirm the quality control situation. Japanese consumers are said to be the strictest in the world, and their needs are diversifying with the times. In addition to supplying safe and dependable products, by building traceability systems, selling products that take food allergies into account, and products that consider health and the environment, we also strive to develop and line up products that will 4

5 satisfy our customers' diverse wishes. We are keen to team up with the kind of companies which can become our partners, whether they are in Japan or overseas. 5