Convenience Stores and the Organization of E-Commerce

Abstract

Previous chapters of this book have dealt with the interaction between the availability of new technologies and knowledge and the emergence of new retail formats in Japan. For the period of the 1990s and since, the largest development in this regard has been the internet and its possibility of offering new means of interaction between consumers and businesses. While this new technology was seen initially as a grand possibility for outsiders to enter the retail scene — and a few companies actually managed to do so — or as a dramatically new way of doing business with fast and tremendous growth prospects, many of these assumptions have since had to be reconsidered. Change has been less dramatic and established retailers have often taken a leading role in the development of the new technology. The question concerning e-commerce has thereby shifted from the replacement of bricks-and-mortar operations to possible combinations of e-commerce and existing retail operations. In Japan, it has been especially convenience store operators that have embraced the new technologies. Companies and observers alike pointed to a number of characteristics of the current business models of convenience stores that would put them in a central position in overcoming many of the problems associated with the expansion of e-commerce in Japan.

While transactions on the internet are virtual the exchange of goods and payments still require a real space. Until now, the convenience store was limited to a size of 100 square meters with an assortment of 3000 items. But, in the future, through the use of e-commerce techniques, it will become possible to handle several 10 000 items on the same 100 square meters. Also, with transactions conducted on the net it will be possible to raise sales without effect on the operation cost of stores since stores do not need to keep stocks, there is no problem of missing articles or responsibility for product loss and it does not incur additional costs for personnel.

(Homepage of FamilyMart at www.family.co.jp/inf/ec/cvs.html)