Japan's Retailers Targeting Foreign Tourist Spending

Above, Ginza's Mitsukoshi department store is considering increasing tax-refund counters. Photo by Armand Vaquer.

There's good news for foreign tourists visiting Japan. Department stores and large shopping complexes are "ramping up" their efforts to entice foreign tourists to spend their yen at their stores.

Tax-free spending by foreign tourists have surged this past year.

According to the Nikkei Asian Review:

The number of foreign visitors to Japan topped 10 million in 2013 for the first time. The amount of money they spent in Japan grew by 30% from the previous year.

To capitalize on tax-exempt shopping by travelers from abroad, who are not affected by the consumption tax hike in April, large retailers are taking steps to improve their shopping experience, such as increasing the number of tax refund counters and currency exchange machines. 

The government, for its part, is expanding policy support to attract more foreign tourists to Japan. The number of products on which foreign visitors do not have to pay consumption tax will be increased this fall, with foodstuffs and cosmetics to be added to the list.

The article cites the "gloomy future of the domestic consumer market" of the country's aging and shrinking population. So they are turning to the foreign tourist market to come to the rescue. There has been a noticeable drop in consumer spending when the consumption tax was hiked to 8% last month.

Some of the biggest retailers, like Matsuya Ginza and their rival, Mitsukoshi, are competing for tourist yen by remodeling their food & drink departments (plus adding more sake brands as sake is a popular foreign tourist souvenir) and adding more tax-refund counters.

To read the full article, go here.