COVER STORY • 5 White Paper on International Economy & Trade 2008 AEON’s Path to Global Operations By Akihito TANAKA

About AEON In January 1983, then company presi- ed market research in , we dent Takuya Okada (currently honorary found traffic congestion in Bangkok AEON is a retail group comprising chairman and adviser), together with a much worse than in Tokyo. So we were 168 domestic and overseas companies senior official of the Chamber of led to search for candidate sites in the controlled by the holding company Commerce and Industry (JCCI), met suburbs instead of the city center. In AEON Co. Central to the group’s oper- with then Malaysian Prime Minister December 1985, JUSCO’s first store in ations is “JUSCO,” a general merchan- Mahathir Mohamad in Tokyo. Thailand opened on the outskirts of dise store. The AEON group also oper- Mahathir requested cooperation in mod- Bangkok. ates the “MaxValu” chain of supermar- ernizing commerce in , and The location of our third store abroad kets and the “” chain of con- Noboru Goto, who became JCCI head following those in Malaysia and Thailand venience stores. We were among the first later, asked Okada to accommodate the was in . In November 1987, to start operating shopping malls in request. we became a core tenant in a commercial Japan. Okada visited Malaysia soon afterward facility in the eastern area of Hong Kong Our mission is to constantly serve cus- and Mahathir showed him candidate Island where a new town was being built. tomers, adhering to the unwavering prin- store locations. The first site that Okada The store, with floor space of 14,000 ciple of focusing on pursuing peace, was shown was in an office district and square meters, was flooded by shoppers respecting humankind, and contributing was not entirely satisfactory, but Okada on its first day. About 3,000 people to the local community, based on our was attracted by the potential of the lined up before the opening hour, and customers as the central core. Malaysian retail market and decided to rushed in as soon as the doors opened. We are a leading retail group in Japan, establish a store there. In June 1985, With so many people crowding each with consolidated operating income in JUSCO’s very first overseas store opened floor, we had to limit the number of visi- fiscal 2007 exceeding ¥5.1 trillion yen in , the Malaysian capital. tors for the rest of the day. At that time, (roughly $50 billion). In December that year, JUSCO opened a Japanese retail companies had already set second store offering a full line of goods up outlets in Hong Kong, but amid soar- Stores in Malaysia, Thailand, Hong in the three areas of clothing, food and ing rent, many were later forced to leave Kong housing. the territory. AEON, in contrast, has During the same period, JUSCO also been successful in Hong Kong as we have In 1985, AEON (then called JUSCO) started retail operations in Thailand. In continued to put efforts into creating opened its first overseas store in Malaysia. the beginning of 1983 when we conduct- stores that focus on the needs of ordinary

Chart Overview of AEON’s overseas GMS & operations

Source : AEON

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Photos: AEON

AEON’s Dongbu store in Qingdao Artist’s sketch of AEON’s No. 1 store in Beijing local residents. tional fashion brands, household appli- ture and religion, and for the staff to We are pleased to note that in the ances and IT products. become united and work hard, always Asian countries and regions where we In 1998, a joint venture with a local aiming at customer satisfaction. Much of began business in the late 1980s, the company opened the Dongbu Shopping the management of AEON’s overseas local companies that operate the stores Centre in Qingdao, Shandong Province. subsidiaries is in the hands of local staff. have steadily grown. The Hong Kong It was ’s first full-fledged suburban The president of AEON Stores (Hong and Malaysian companies were listed on shopping center. The facility has parking Kong) Co. is an excellent local native. the local stock exchanges in 1994 and space for 800 vehicles, and continues to Currently, as the Japanese domestic 1996 respectively. draw numerous customers to this day, market is facing a decreasing population More than 20 years have passed since becoming a model case in the moderniza- society, we cannot hope to see the kind the stores were opened. Ceremonies tion of China’s retail industry. of development that we saw during the have been held to mark the various country’s period of fast economic anniversaries, and the events have been First Beijing Store to Open growth. Under these circumstances, our graced by the presence of important per- This Year goal is to make the same kind of achieve- sonages. The local companies that oper- ment overseas as in Japan by 2020. At ate AEON stores have clearly earned a In Beijing, where I currently live, a the moment, the proportion of overseas solid reputation both in name and reality large AEON shopping center is to open operations to domestic business is small, in their respective countries and regions. in the suburbs later this year. but is likely to become increasingly larger Considering the future development of in the future. When we look back at the Stores in China motorization, the shopping center’s park- history of the retail industry, we see that ing space will have capacity for 8,000 chain stores in Japan have adopted In July 1996, a general merchandise vehicles. Many companies, not only advanced retailing technology from store (GMS) was set up in the city of from China but from Japan, are sched- Europe and the United States, and con- Guangzhou, Guangdong Province, by uled to become tenants in this facility. tributed to improving the living standard Guangdong Jusco Teem Stores Co., a The number of AEON stores in China of Japanese consumers. joint venture between JUSCO Stores including Hong Kong is now 23. Our I believe the retail industry is also a (Hong Kong) Co., an AEON subsidiary plan is to add 80 stores by 2010, boost- regional industry, and that it is one of the operating Hong Kong stores, and a local ing the total number to about 100. industry’s social responsibilities to partner company. The store was located enhance the livelihood and culture of in the first basement of a large commer- AEON’s Future of Overseas people in a foreign country where we cial complex (a grand mall), Guangzhou Operations operate. We will continue to expand our Teem Plaza, being developed in Tianhe business, always keeping close to our Ward, a business and commercial center. The retail industry is a people-based hearts the principle that everything we do The store provided a full line of clothing, industry. I have learned through my must be for the customer. food and housing products, and adopted experience abroad that people are indeed a self-service method. Of all goods, near- our assets. When starting business in a Akihito Tanaka is Chief Representative for ly 100% were locally procured, and new country, it is most important to China, AEON Co. He once served as executive mainly comprised daily household neces- respect the country’s national traits and vice president in charge of the company’s sities as well as a wide range of interna- customs, learn about differences in cul- shopping center development business.

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