Variety engineering in the changing competitive environment of Japanese retail distribution

Abstract

The authors propose to define the revolution occurring in Japanese retail distribution from a systems-theoretic perspective, and to identify factors leading to the success of certain types of retailers and the decline of others. It is proposed that large general merchandising stores and national supermarkets are meeting the increased variety of the environment brought on by the bursting of the Japanese economic bubble, increased price consciousness of consumers, government deregulations and appreciation of the yen. These retailers are redefining their functions to enhance their internal variety, leading to greater efficiency and lower consumer prices. In contrast, traditional retail outlets, such as department stores and small individually-owned stores, have not been able to review their operations within the context of the changing environment and are trapped within their traditional business paradigms and reference models. As a result, they are facing decline. © 1998 John Wiley & Sons, Ltd.