Walmart has faced its share of struggles in Japan but it’s forging ahead with a Japanese digital flagship store in partnership with Rakuten that will fulfill orders via air from U.S. inventory.
Dubbed the Walmart Rakuten Ichiba Store, the online shop lives on the Rakuten Ichiba “internet shopping mall” and will initially offer a select assortment of roughly 1,200 products in categories including clothing, toys and items for the outdoors. This new online outlet is the fruit of a strategic alliance the companies forged early in 2018. More than 99 million people in Japan hold Rakuten memberships.
Walmart considered local preferences when deciding to bundle shipping, taxes and duties into each product, part of what it calls a “no surprises policy” designed to ensure no additional costs when orders reach their destination. That’s because instead of holding inventory in Japan, Walmart said it will air-ship orders from the U.S.
The company will update and expand the range of products on offer from its international assortment as it learns about what Japanese customers are interested in buying. The company said its troubled supermarket-heavy subsidiary Seiyu GK, which was reportedly up for sale earlier this year, will manage customer service for orders placed on the Rakuten Ichiba store.
“Through the opening of the Walmart Rakuten Ichiba Store, we hope to make Rakuten Ichiba an even more attractive destination for online shoppers in Japan,” Shunsuke Yazawa, executive officer and VP of the marketplace business at Rakuten, Inc. said.
Walmart has big ambitions for its international business, as evidenced by its $500 million investment with Chinese e-comm powerhouse JD.com in the JD-Daojia logistics effort, and its $16 billion investment in Indian startup Flipkart for 77 percent ownership.
In Japan, however, Walmart has faced adversity, acquiring Seiyu GK’s group of shopping centers, supermarkets and department stores in 2008 after taking a minority stake in 2003. Recently, Walmart closed 100 Seiyu stores, according to a CNBC report. Over the summer, Japanese rival retailer Don Quijote said it would consider purchasing the Seiyu Group if Walmart wanted to offload it—which it did, according to a report from the Nikkei Asian Review. Walmart denied the rumors.
Walmart’s Rakuten partnership could provide a solid footing to reboot its efforts in a country of more than 126 million people.