|To rescue Japanese retail in particular, get Chinese tourists to buy, er, fancy toilets?|
Thousand-dollar rice cookers and toilet seats that know when you enter the room. That’s what visitors to Japan from China have been buying at Laox Co., sending the Tokyo-based duty-free store chain to its first profit in 14 years and its shares up 1,400 percent through yesterday from a low in 2012. The stock gained 1.5 percent today to close at the highest since July 2009.Er, OK...if Hello Kitty toilets are what floats the boat of Chinese shoppers, so be it. However, Chinese media is not quite amused, bashing the tastes of PRC consumers heading abroad in addition to not supporting local industry. My goodness, these folks sound the same all over the world...
The Chinese-owned company has had an unlikely ally: Prime Minister Shinzo Abe. While the Abe administration has sparred with its communist counterpart over ownership of the Senkaku Islands, Japan has also been courting its neighbor’s citizens by relaxing visa rules. That has led to record tourist arrivals, and thanks to “Abenomics,” a weaker yen is putting more money in their travel wallets.
Luo Yiwen, Laox’s president, says he knows the shares have gained a lot, and that a flare-up in tensions, or another big earthquake, would hurt his business. Yet he says the exuberance isn’t that irrational. Japan is opening up and ties with China will only deepen. “Yes, our shares are rising on expectations, but they aren’t that strange,” the 51-year-old said. The stock price will soon be supported by earnings, he said. Chinese tourists are big spenders at Laox stores, accounting for as much as 70 percent of sales, according to Luo.
For hundreds of thousands of Chinese travelers visiting Japan during the Chinese New Year holiday, the top item on their souvenir lists was headed straight for their bottoms. Chinese tourists flooded Japan last week, spending an estimated $959 million in Japan’s shopping malls and department stores, according to Chinese state-run newspaper Global Times. While many splurged on luxury goods, the hot item this season was Japanese toilet seats...Go figure. If toilet sales can improve both Japanese retail sales and China-Japan relations, who am I to, ah, dump on this laudable exchange?
While the interest of Chinese consumers was a boon for Japanese businesses, the state-run Chinese media was a bit disturbed by the phenomenon.The Global Times even found it necessary to pen an editorial on the trend, chiding Chinese buyers. “That Chinese tourists swamp Japanese stores at a time when [China] is facing a sluggish domestic demand is certainly not something to be proud of,” the paper opined. China’s economic growth rate has been slowing, though it still far outpaces Japan’s.