Restoring the Top Line by Reviewing Core Promotional Initiatives and Strengthening Store Competitiveness

「Gross profit fell below plan owing to higher prices for materials and other items affected by petroleum products such as naphtha, stronger pricing and promotional measures in response to intensifying competition, and customer numbers and items purchased per customer falling below expectations.」

「For products, we sought to optimize the selling prices of approximately 100 high-demand processed and daily foods, while expanding the range of Topvalu and Topvalu Best Price, private brands of the AEON Group, to strengthen price competitiveness.」

「The performance of our group during the current interim consolidated accounting period showed higher consolidated revenue and earnings year on year, supported by the recovery in existing-store customer traffic and a significant contribution from the performance of the integrated いなげや business.」

「At マルエツ, operating revenue increased as customer traffic and average spend per customer exceeded the levels in the same period of the previous year. Although metrics including gross profit improved and ordinary profit increased year on year, net profit declined year on year because of the impact of a change in the tax rate for the pro forma standard taxation system.」

「At カスミ, while continuing sales initiatives for the Scan&Go Card and ignica Points, for which it focused on increasing usage last fiscal year, we lowered the in-store prices of frequently purchased products and focused on increasing the number of items purchased per customer.」

「During the current consolidated fiscal year, customer traffic and average spend per customer recovered at マルエツ and マックスバリュ関東, and improvements in operating revenue, gross profit and other metrics resulted in higher revenue and earnings.」

「In addition, カスミ began issuing a new card in July, shifting from price-focused promotions through flyers to providing carefully tailored value offers based on each customer’s preferences and needs, while seeking to provide a digital experience and services to customers who pay in cash. Because the program required some time to gain traction initially, operating revenue was 99.8% of the level in the same quarter of the previous year, but operating revenue and gross profit have entered a recovery trend after membership exceeded 1 million.」

「In addition, カスミ began issuing a new card in July, shifting from price-focused promotions through flyers to providing carefully tailored value offers based on each customer’s preferences and needs, while seeking to provide a digital experience and services to customers who pay in cash. Because the program required some time to gain traction initially, operating revenue was 99.9% of the level in the same quarter of the previous year, but it has entered a recovery trend as membership approached 1 million, bringing operating revenue and gross profit closer to the expected levels.」

「During the first quarter of the current consolidated cumulative period, the unit price per item purchased rose under the impact of price increases for various products, while the number of items purchased per customer declined. Although average spending per customer fell below the level in the same quarter of the previous year, sales exceeded the year-earlier level because of the recovery in existing-store customer traffic.」

「Under these circumstances, our group has worked to strengthen its response to customer needs by restraining selling prices through various measures and offering high-value-added products in response to price increases. These measures have put customer traffic on a recovery trend, but the overall pressure for price increases reduced the number of items purchased per customer, leaving challenges in securing the expected sales and gross profit.」

「In selling, general and administrative expenses, we reviewed labor costs and promotions, including flyers, through productivity improvement initiatives involving the introduction of full self-checkout and the expanded rollout of Scan&Go Ignica (a scan-and-go service).」

「Against the backdrop of the weaker yen, a trend toward price increases, rising energy costs and a decline in consumer sentiment following the easing of COVID-19 restrictions, we strengthened sales promotions to overcome these challenges. As a result, more customers visited our stores than in the previous year.」

「At existing stores, customer traffic was 100.3% of the level in the same quarter of the previous year, while average spend per customer was 96.4%. Customer traffic exceeded the previous year, partly because customers responded positively to various sales promotion measures, including the use of digital tools.」

「In sales operations, we promoted the continued use of the Senior Passport and Childcare Support Card, which enable eligible customers to purchase their preferred products at attractive prices.」

「In addition, to restore the top line, we are reviewing standard promotions and strengthening store competitiveness, while expanding each company’s card membership and rolling out the USMH official mobile app, which enables smartphone payments without going through the checkout, as part of efforts to strengthen relationships with customers. We also opened a total of 4 new stores in November and December and are working to expand the top line alongside efforts to revitalize stores.」

「In addition, to restore the top line, we are reviewing standard promotions and strengthening store competitiveness, while expanding each company’s card membership and rolling out the USMH official mobile app, which enables smartphone payments without going through the checkout, as part of efforts to strengthen relationships with customers. We also opened a total of 4 new stores in November and December and are working to expand the top line alongside efforts to revitalize stores.」

「In addition, to restore the top line, we are reviewing standard promotions and strengthening store competitiveness.」