What can you tell us about the domestic business?
We are striving to reinforce our revenue base through the renovation of existing malls, and by focusing on the development of distinctive malls tailored to local characteristics.
To achieve sustainable growth and stable revenue in the domestic business, it is important to revitalize existing malls by renovating them in a planned manner. In fiscal 2015, we renovated a total of 11 malls, and sales at specialty stores in each mall maintained almost double-digit growth on a year-on-year basis after renovation.
At AEON Lake Town, one of the flagship malls of the company, renovation was conducted in two phases in April and November, and more than 500 stores, or approximately 70% of a total of 710 stores, were upgraded. In the second phase of renovation, a deck that connects “Kaze” and the outlets was constructed to improve the overall circulation inside Lake Town, which consists of three malls. At AEON MALL Chikushino, a large-scale renovation, which included floor expansion equal to 16% of the gross leasable area, was implemented in December and 182 stores, or about 90% of all 210 stores, were upgraded. As a result, sales at specialty stores in AEON Lake Town exhibited double-digit growth year on year, while AEON MALL Chikushino showed growth of 1.5 times year on year.
Looking at new mall openings in Japan, we focus on developing each individual mall with a clear concept after identifying local characteristics and market needs. At AEON MALL Tokoname which opened in December 2015, we built an outdoor park equipped with experienced-based facilities such as field athletics and a cart circuit on its vast site of approximately 202,000 m2, taking advantage of it being a seaside location next to Chubu Centrair International Airport. To meet inbound demand, we have also installed landmarks such as large lanterns in a Japanese style and beckoning cats, as well as foreign exchange machines, multilingual guide signs, and a departure board showing the flight time of planes, aiming to create a mall where foreign customers are able to comfortably enjoy their time. Gaining popularity thanks to these features, the mall is crowded with the customers it draws from a wide range of areas, including Nagoya City and other prefectures, as well as foreign customers.
At AEON MALL Shijonawate which opened in October 2015, we developed a “mall in mall” that applies our concepts to specific squares inside the large mall. As an urban mall on the outskirts of Osaka City, one of the concepts for this mall is to target adult women with highly sensitive tastes in fashion, general merchandise, and cosmetics. With these efforts, it promotes the cultivation of urban demand.