Market Trends in Fresh Produce Distribution, Food Retail and Information Services

「In the fresh-produce distribution industry in which our group operates, labor shortages are becoming increasingly serious across the entire supply chain, from production sites to retail stores, while active investment in DX and moves toward corporate integration and restructuring are gaining momentum. Among mass retailers, primarily supermarkets, reducing the labor required for operations and strengthening product appeal have become urgent priorities, and demand is rising for system implementations aimed at improving store operating efficiency, including AI-based sales-floor proposals and automated planogram creation. Drugstores are also expanding their food offerings and rolling out the "drugstore and food" format to increase customer visit frequency and capture demand for bulk purchases. In domestic agriculture and on the production side, damage caused by extreme weather, including record-high temperatures, as well as outbreaks of pests, diseases and wildlife damage, is contributing to the increasing normalization of risks involving lower agricultural production and unstable supply.」

「In the fresh produce distribution industry, labor shortages are becoming increasingly severe across the entire supply chain, from production sites to retail stores, while companies are stepping up investment in DX and moves toward business integration and restructuring are gaining momentum. Retail mass merchandisers, particularly supermarkets, urgently need to reduce labor requirements in their operations and strengthen their product offerings, driving increased demand for systems and other measures to improve store operating efficiency. Drugstores are also expanding their food offerings, developing “drug and food” formats aimed at increasing customer visit frequency and capturing demand for bulk purchases.」

「Active investment in DX (digital transformation) and moves toward corporate integration and restructuring are gaining momentum against a backdrop of social issues including population decline, accelerating changes in the business environment.」

「In retail, companies are responding to consumers' cost-consciousness amid prolonged inflation and pursuing business expansion through various means, including rolling out PB (private-label) products and using retail media. They are also investing in demand forecasting and automated ordering systems using AI technology and developing various sales formats, such as mobile sales and EC sales, to improve store operating efficiency and address consumers' diverse needs.」

「In the fresh-produce distribution industry in which our group operates, active investment in DX (digital transformation) and moves toward corporate integration and restructuring are gaining momentum against a backdrop of social issues including population decline, and the business environment is changing significantly.」

「Mass retailers, primarily supermarkets, are responding to consumers' cost-consciousness amid prolonged inflation and pursuing business expansion through various means, including developing PB (private-label) products, cutting prices on products with strong price appeal, and rolling out high-value-added PB products. They are also investing in demand forecasting and automated ordering systems using AI technology, cashierless automated payment systems, and new sales formats such as mobile sales, EC sales and smart stores, thereby improving store operating efficiency and addressing consumers' diverse needs.」

「The environment surrounding fresh-produce distribution, the main business area in which our group operates, is being affected by sluggish consumption, population decline and the food security crisis, while initiatives in the DX (digital transformation) field are becoming increasingly active in response to structural industry issues. In retail, companies are promoting digitalization and efficiency improvements, including cashless payments, in response to rising store operating costs such as utilities and labor costs. At the same time, since the COVID-19 pandemic, they have been pursuing both streamlining and customer satisfaction while exploring improvements to services such as EC (electronic commerce) and delivery in response to increasingly diverse consumer needs arising from changes in lifestyles.」

「Although the earnings environment is becoming increasingly challenging due to further increases in costs such as utilities, materials, and employee recruitment and training, digitalization and efficiency improvements, including the introduction of cashless payments and self-checkout systems, are beginning to take hold. As the company explores new store operating models, such as mobile supermarkets, home delivery and next-generation online supermarkets, it is pursuing both streamlining and higher customer satisfaction.」

「In the fresh-produce distribution industry in which our group operates, the business environment is changing significantly. Against a backdrop of social structural changes, including population decline, and the need to address structural issues such as improving productivity, companies have a strong appetite for investment, particularly in digital investment and DX (digital transformation) initiatives. Among mass retailers, primarily supermarkets, the competitive environment is becoming increasingly challenging as the food e-commerce market expands and companies from other industries strengthen their handling of fresh produce.」

「Retail mass merchants, primarily supermarkets, are operating in a difficult environment as various selling, general and administrative expenses rise, including utility and materials costs and the costs of securing and training personnel. As competition intensifies due to entrants from other industries selling fresh products, they are pursuing both higher customer satisfaction and improved profitability.」

「Retail mass merchants, primarily supermarkets, are facing increases in all selling, general and administrative expenses, including higher utility and materials costs. While promoting digitalization and efficiency through measures such as cashless payments and self-checkout to improve store operating efficiency and optimize product procurement, they are also exploring new store operating formats such as mobile supermarkets and home delivery.」

「As a global initiative toward achieving a sustainable society, the fresh-produce distribution industry also faces issues such as decarbonization and food-loss reduction, and it will be necessary to strengthen business development with greater consideration for the environment.」

「In fresh-produce distribution, where our Group primarily operates, investment in digital transformation (DX) is active in response to social structural changes such as population decline. As the e-commerce market and online supermarkets expand, competition among related businesses, including home-delivery operators, is also intensifying. Digital technologies such as cashless payments are beginning to take hold, and the environment surrounding the industry is changing rapidly.」

「The environment surrounding fresh-produce distribution, where our Group primarily operates, is characterized by strong investment appetite in digital transformation (DX), driven by social structural changes such as population decline and the need to respond to the spread of infectious diseases. Competition is intensifying among e-commerce and home-delivery operators in the supply chain.」

「Meanwhile, the business environment surrounding the supermarket industry has been difficult for some time. Supermarkets are expected to pursue strategies aimed at maintaining sustainable and highly competitive advantages by strengthening their focus on local communities and providing detailed, community-based services centered on product strength.」

「In the supermarket industry, total annual supermarket sales in 2020 grew significantly year on year, reaching 106.3% on an all-store basis and 105.0% on an existing-store basis, driven by increased demand for food consumed at home. The fresh-produce segment was particularly strong, with growth of 109.2%, and this trend is expected to continue for some time.」

「In retail, supermarket consolidation and cooperation are increasing due to weak consumption and population decline, while during the COVID-19 pandemic, e-commerce and home-delivery operators expanded, intensifying competition. Wholesale markets have also experienced declining wholesale volumes since before the pandemic and are recognized as facing structural challenges, including securing workers and improving logistics efficiency.」

「In retail, supermarket consolidation and cooperation are increasing due to weak consumption and population decline, while during the COVID-19 pandemic, e-commerce and home-delivery operators expanded, intensifying competition. Wholesale markets have also experienced declining wholesale volumes since before the pandemic and face structural challenges, including securing workers and improving logistics efficiency.」

「The COVID-19 pandemic is gradually establishing a "new lifestyle" among consumers. The sales methods used in the environment surrounding fresh-produce distribution, our Group's principal business area, have also changed significantly. Services are becoming more personalized as checkout payments shift to cashless methods, enabling retailers to provide more detailed customer support. More supermarkets are also moving toward cashierless operations to maintain social distancing. In addition, efforts to increase product added value, including expanding the handling of organic agricultural products and offering highly fresh locally produced agricultural products, as well as making producers more visible to consumers, are progressing as part of efforts to differentiate from other stores.」

「The environment surrounding fresh-produce distribution, our Group's principal business area, changed as the declaration of a state of emergency to prevent the spread of COVID-19 increased demand for food consumed at home, driving food-related sales at supermarkets and drugstores. It also led to greater use of diversified food-related services, including online food sales, delivery services and takeaway services at restaurants.」

「Major supermarkets are expanding competitive private-label products, growing their businesses and building group affiliations, resulting in competition that extends across business formats.」

「Over the medium to long term, consumption of fresh products itself is expected to decline due to population decline and aging in the fresh-produce industry, our Group's principal business area. We have also increasingly heard from companies involved in agricultural product distribution and from our customers that labor shortages have affected operations for several years and are beginning to disrupt on-site operations.」

「Major supermarkets are adopting SPA models, as in the apparel industry, and expanding competitive private-label products, growing their businesses and building group affiliations. Competition is intensifying, with mid-sized supermarkets seeking to establish a counterweight to major chain stores through alliances and consolidation.」

「Labor shortages resulting from population aging and decline are driving up costs, including labor costs, while new channels for fresh-produce sales, such as drugstores and e-commerce platforms, are expanding. Against this backdrop, conventional supermarkets are experiencing significant industry consolidation.」

「The environment surrounding fresh produce distribution, our Group's principal business area, is changing dramatically.」

「However, the working-age population is declining year by year due to the declining birth rate and population aging, and labor shortages have become a prominent issue across various industries. In the fresh fruit and vegetable distribution industry, our Group's principal business area, producers, intermediate distributors, retailers and the food service industry are also finding it increasingly difficult to secure personnel. There is a strong need to improve productivity through operational efficiency and working conditions through work-style reform.」

「However, the working-age population is declining year by year due to the declining birth rate and population aging, and labor shortages have become a prominent issue across various industries. In the fresh fruit and vegetable distribution industry, our Group's principal business area, producers, intermediate distributors, retailers and the food service industry are also finding it increasingly difficult to secure personnel. There is a strong need to improve productivity through operational efficiency and working conditions through work-style reform.」

「Reforms of the National Federation of Agricultural Cooperative Associations and the development of various legal and regulatory frameworks are under way, and the distribution structure for fresh products, including industry consolidation, is expected to change significantly going forward. Distribution is also becoming more diverse, with consumers purchasing fruit and vegetables through mail-order services and at direct-from-producer outlets.」

「In the fresh fruit and vegetable distribution industry, banana import volumes, bananas being the main product of major client companies, remained above the previous year. Food sales at existing retail stores remained slightly below the previous year, while IT-related investment in the information services industry remained above the previous year.」

「In the fresh fruit and vegetable distribution industry, banana import volumes, bananas being the main product of major client companies, remained slightly above the previous year. Food sales at retail stores after adjusting for store openings and closures remained slightly below the same period of the previous year, while IT-related investment in the information services industry remained above the previous year.」

「In the fresh fruit and vegetable distribution industry, banana import volumes, bananas being the main product of major client companies, remained around the previous year's level. Food sales at retail stores after adjusting for store openings and closures remained slightly below the previous year. In the information services industry, IT-related investment remained above the previous year.」

「In the fresh fruit and vegetable distribution industry, banana import volumes, bananas being the main product of major client companies, remained slightly above the previous year. Food sales at retail stores after adjusting for store openings and closures remained slightly below the previous year, while IT-related investment in the information services industry remained slightly above the previous year.」

「In the fresh fruit and vegetable distribution industry, banana import volumes, bananas being the main product of major client companies, remained slightly below the previous year. Food sales at retail stores after adjusting for store openings and closures remained above the previous year, partly due to higher agricultural product prices, while IT-related investment in the information services industry remained above the previous year.」

「In the fresh fruit and vegetable distribution industry, food sales in the retail sector remained above the previous year, while IT-related investment in the information services industry also remained above the previous year.」

「In the fresh fruit and vegetable distribution industry, banana import volumes, bananas being the main product of major client companies, remained above the previous year. Food sales at retail stores after adjusting for store openings and closures remained at around the previous year's level, while IT-related investment in the information services industry remained above the previous year.」