What: The Japanese retail market has tremendously evolved in the past 40 years.

Why it is important: Retailers know more than anyone else that past grandeur is not a safety belt for the future. Sogo has gone through its second major issue in less than 40 years.

Shopping mirrors societal shifts and nowhere is this clearer than in Japan’s department stores, which have evolved alongside the nation's capitalism. Tracing its roots back to 1673 with Echigoya, the journey of Japanese department stores is intertwined with the nation’s economic history. These stores, once symbolic of Japan's economic prowess, faced severe challenges during economic downturns, with significant events such as Sogo Co.’s major bankruptcy in 2000, and Sogo & Seibu Co.’s recent sale to a US fund after a historic worker strike. Such moves highlight the evolving business landscape in Japan, where even long-cherished institutions are being sold to foreign entities.

Although the industry experienced restructuring and a focus on domestic over international expansion, the iconic nature of some stores remains. Currently, there's a transition from premium department stores to discount electronics and online shopping, with younger generations favoring online platforms like Shein. However, flagship stores in major cities are surprisingly thriving, indicating a wealth shift to major urban centers. As Japan's societal norms and economic structures evolve, so will its iconic department stores.

How Sogo reflects the evolution of Japan