Risks from Economic Conditions, Consumer Trends and Shifts in Retail Competition

「At the same time, we recognize the need to continue closely monitoring downside risks to the economy, including persistently high energy prices due to the situation in the Middle East, the impact of rising prices on consumption, and volatility in financial and foreign-exchange markets.」

「At the same time, uncertainty is increasing due to the impact of US trade policy and heightened geopolitical risks. We recognize the need to continue closely monitoring the outlook for domestic and overseas economies and downward pressure on consumer sentiment from rising prices.」

「During the first quarter of the current consolidated fiscal year, the Japanese economy showed a gradual recovery. Personal consumption also showed signs of recovery, supported by strong inbound spending and improvements in employment and income conditions. At the same time, we recognize the need to continue closely monitoring the risk of downward pressure on personal consumption from the outlook for domestic and overseas economies amid interest-rate and foreign-exchange fluctuations and from prolonged inflation.」

「The Company recognises the need to continue monitoring downside risks to personal consumption arising from the outlook for domestic and overseas economies amid interest-rate and exchange-rate movements, as well as the prolonged rise in prices.」

「Meanwhile, the Company recognises the need to continue monitoring downside risks to personal consumption, including the cooling of consumer sentiment caused by surging resource prices and rising prices.」

「Meanwhile, if other countries fall into recession and asset prices, including stock prices, plunge, Japan could also be affected, potentially leading to a further stagnation in consumption and having a significant impact on the Group's business performance.」

「However, the Company recognises the need to continue monitoring downside risks to consumption from developments in COVID-19, including the eighth wave, sharp exchange-rate fluctuations and rising prices.」

「In the retail industry, concerns had emerged about the negative effects of COVID-19 and rising prices on personal consumption. However, signs of recovery appeared after priority preventive measures were lifted in late March, as no restrictions on movement were imposed during the holiday season and revenge spending emerged. Nevertheless, the Company recognises the need to continue monitoring downside risks to consumption from developments in COVID-19, sharp exchange-rate fluctuations and rising prices.」

「Although positive signs have emerged, the Company needs to continue monitoring downside risks to consumption, including the unresolved outlook for the end of COVID-19, heightened geopolitical risks, the effects of sharp exchange-rate fluctuations arising from these factors, and the cooling of consumer sentiment due to rising prices.」

「Meanwhile, Russia's invasion of Ukraine has had various effects on the Group. Surging fuel and grain prices resulting from the invasion have spread to other goods, causing a worldwide rise in prices.」

「Although personal consumption turned positive year on year, it remained mixed because of the effects of restrictions on the movement of people during the spread of COVID-19.」

「In the retail industry, approximately one year after the outbreak of COVID-19, business performance had been on a recovery trend from March to mid-April 2021. However, following the application of priority preventive measures and the issuance of a third state of emergency, stores have continued to face a situation since mid-April in which they have had to shorten business hours and refrain from operating sales areas for nonessential goods. Although consumption is expected to recover as measures such as vaccination progress, the risk of downside effects from the spread of infection continues to require close attention, and consumption trends remain uncertain.」

「Although personal consumption gradually recovered from the decline at the beginning of the fiscal year, it remained weak, also affected by the reissuance of a state of emergency toward the end of the fiscal year.」

「Real GDP growth in July–September 2020 declined 5.7% year on year, according to the Cabinet Office's second preliminary report. Although it recovered from April–June 2020, which recorded the largest postwar contraction, conditions remained severe. Private final consumption expenditure also declined 7.3% year on year in July–September. Although this too recovered from April–June, difficult conditions continued.」

「Japan's gross domestic product (GDP) for April–June 2020 declined at an annualised rate of 28.1% from the previous quarter, according to the Cabinet Office's second preliminary report, marking the steepest decline since 1980, when the current benchmark was introduced. Household final consumption expenditure also fell 11.3% year on year in April–June, its steepest decline on record.」

「Personal consumption also fell sharply as many consumers refrained from making nonessential outings, and the Company expects the consumption downturn could continue for an extended period.」

「Although employment and income conditions remained solid, personal consumption lacked strength owing in part to the prolonged downturn following the consumption tax rate increase, and both inbound and domestic consumption declined because of the effects of COVID-19, worsening toward the end of the fiscal year.」

「During the first 3 quarters of the consolidated fiscal year, the Japanese economy was unstable and lacked strength, with fluctuations in personal consumption resulting from the effects of a major typhoon, front-loaded spending ahead of the consumption tax increase and the subsequent reaction after the increase.」

「In the retail industry, positive factors included improving employment conditions, a gradual recovery in income, strong inbound consumption and a recovery in the consumer price index. However, consumers' preference for saving, driven by sluggish stock prices and higher food prices, continued, leaving overall personal consumption lacking strength.」

「In the retail industry, positive factors included improving employment and income conditions and continued strength in inbound consumption and high-value purchases by affluent consumers. However, concerns about the future associated with higher social security costs and the effects of large-scale natural disasters left overall personal consumption in a mixed pattern.」

「In the retail industry, although positive factors included improving employment conditions, a gradual recovery in income, strong inbound consumption and a recovery in high-value purchases by affluent consumers, concerns about the future associated with consumption polarisation and higher social security costs, as well as consumers' preference for saving, continued, leaving overall personal consumption in a mixed pattern.」

「In the retail industry, although concerns about the future associated with the progress of consumption polarisation and higher social security costs, as well as consumers' preference for saving, continued, overall personal consumption recovered gradually as employment conditions improved and income recovered slowly, with positive factors including strong inbound consumption and a recovery in high-value purchases by affluent consumers.」

「The declining birth rate, population ageing and longer life expectancy are the most significant environmental changes certain to occur in the future, and the era of 100-year lifespans is certain to arrive in the near future.」

「In the retail industry, concerns about the future associated with the progress of consumption polarisation and higher social security costs, as well as consumers' preference for saving, continued, and weather-related factors put downward pressure on consumption. At the same time, consumption was supported by the wealth effect of recent stock price gains and gradual improvement in employment and income, while positive factors emerged, including a recovery in inbound consumption and high-value purchases by affluent consumers, and overall personal consumption began to recover.」

「In the retail industry, although concerns about the future associated with the progress of consumption polarisation and higher social security costs, as well as consumers' preference for saving, continued, overall personal consumption began to recover as employment and income continued to improve gradually and positive factors emerged, including a recovery in inbound consumption and high-value purchases by affluent consumers.」

「In the retail industry, although consumption polarisation, concerns about the future associated with higher social security costs and consumers' preference for saving continued, overall personal consumption began to recover as employment and income continued to improve gradually and positive factors emerged, including a recovery in inbound consumption and high-value purchases by affluent consumers.」

「In addition to the declining birth rate, population ageing and population decline, the operating environment for existing businesses centred on physical stores is expected to become increasingly challenging, owing to the decline in the middle class accompanying the polarisation of income, the rise of e-commerce, the shift in consumption from goods to experiences, and the spread of new forms of consumption, including the sharing economy.」

「In the retail industry, overall personal consumption lacked strength as the polarisation of consumption progressed, uncertainty about the future, including social security, increased consumers' preference for saving, and growth in inbound consumption slowed and spending per customer declined, while the government had decided to postpone an increase in the consumption tax.」

「In the retail industry, overall personal consumption lacked strength as the polarisation of consumption progressed, consumers' preference for saving strengthened amid the decline in stock prices from the second half of the previous year and uncertainty about the future, and growth in inbound consumption slowed and spending per customer declined, while the government had decided to postpone an increase in the consumption tax.」

「In the retail industry, consumer sentiment declined rapidly and overall personal consumption lacked strength, as the polarisation of consumption progressed, stock prices fell from the second half of the previous year, uncertainty about the future increased, and price increases caused by the weaker yen and higher raw material costs increased the burden on household budgets and strengthened consumers' preference for saving.」