The Internationalization of Retailing and Business Corporate Ethics: Mainly through Japanese convenient stores format



In recent years, many retailers of America, West Europe and Japan have increasingly operated internationally. And retail internationalization has gained much prominence in managerial practice and academic discussion. For example, Wal-Mart (America), Tesco (United Kingdom), Carrefour (France) and so on, which operate GMS (general merchandise store) format stores, moreover Ikea (Sweden) and Laura Ashley (United Kingdom) and so on, which operate specialty format stores, have extended internationally. Ultimately, we are having much opportunity to see and use these foreign stores. During initial phases in 1990s, these retail companies have mainly extended in emerging markets, but in recent years they were also introduced in developed markets, which has led new competition phase.

Considering this internalization trend, this paper focuses on Japanese convenience store companies and their internalization strategy. The selection of Japanese convenience store companies for this study was related to their notoriety among Japanese retail industry and their proactive international extension mainly in the Asian regions.

At present, four Japanese convenient companies, Seven Eleven, FamilyMart, Lawson, and MiniStop has entered international markets and operated proactively. Primarily, convenient store offer “the convenience” regarding to times, proximity of stores to home and selection of goods. As the elements enabling to offer these conveniences to customer, earlier studies have pointed two elements of the strength of Japanese convenient stores. The first one is the development of information technology (IT), which fosters the communication between the franchisor and the franchisee. The second element is the development of the system of the distribution of goods enabled by the collaboration between the wholesaler and manufacturer.

In fact, the development of IT enables the constant stream of sales and inventory date to flow between each store (franchisee) and headquarters (franchisor). For example, Seven Eleven has reformed the IT system five times between 1978 and 1997. POS (point of sales), interactive POS, and EOB (electric order book) has been constructed, and this has enabled the efficient merchandise development in headquarters and helped each store to receive the detail data of sales trend. In addition, the development of the system of the distribution of goods has enhanced the accuracy of orders’ information. However, the collaboration between the wholesaler and manufacturer is a requisite element, which was successfully constructed by Japanese convenience store companies. In fact, they have been trying to develop these systems for business expansion in the international markets.

However, as retailing industry is not classified as global industry but as multi-domestic industry, retailing companies is closely related to local retail trade area, local society, local economic and local culture. In addition, considering that retailing industry is a basic industry, which means the basic function of each country’s economy, unless foreign retailing companies must, thus, carefully consider not only local consumer’s benefit but also the effect of local traditional retailing stores, development of employment environment. This paper has made an attempt to explore the way of retailing company’s (especially Japanese convenience store companies) operation in foreign markets by considering business corporate ethics. And the necessity and importance of business corporate ethics for international retailing companies was examined.


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