Summary of Research Findings

According to the "Results of FY2022 E-Commerce Market Survey" compiled by the Ministry of Economy, Trade and Industry (METI), the size of the domestic B2C ecommerce market, including the merchandising, service, and digital sectors, was estimated to be valued at 22,744.9 billion yen in 2022, which was equivalent to 109.9% of the previous year’s size. The merchandising sector amounted to 13,999.7 billion yen, equivalent to 105.4% of the previous year’s size. This amount indicated that the ecommerce ratio for merchandising reached 9.13%, marking a 0.35-point year-over-year increase and showing a further increase in the use of ecommerce among consumers. Although the growth rate slowed down from the previous year, these trends contributed to the market's growth.

As in previous years, Amazon Japan drove the online retail market. Its sales for FY2022 exceeded 3 trillion yen, maintaining double-digit growth year over year. Companies providing food subscription services and online supermarkets also experienced favorable sales in their online retail businesses. According to METI’s data*, the ecommerce ratio for the “Food, Beverage, and Liquor” category was 4.16% in 2022, an increase of 0.39 percentage points from the previous year. This was much lower than that of other commodities. However, B2C ecommerce sales of these items achieved 2.7505 trillion yen in the same year, which was equivalent to 109.2% of the previous year's sales. This growth achieved the largest size in the merchandising sector of online retail. The Food ecommerce sector grew mainly through online supermarkets, which could expect an increase in users and could be promising for growth.

*Source: Results of FY2022 E-Commerce Market Survey Compiled by Ministry of Economy, Trade and Industry

Noteworthy Topics

Enhanced Measures for Last Mile Delivery, and Increased Collaborations among Logistics Companies

Last mile delivery refers to the last journey of the whole delivery process to the final destinations, i.e., from the final logistics base to the home of a consumer or close to it. Ecommerce market players have striven to differentiate from other competitors in last mile delivery logistics services by offering free delivery fees or the same-day delivery. There also are moves to enhance last mile delivery by placing the bases even closer to user locations to shorten the delivery distance. However, last mile delivery has some issues, such as CO2 emission increase and re-delivery problem powering already significant driver shortage, in association with soaring manpower costs, aging drivers, and challenging working environment. Logistics vendors, therefore, are suffering from providing or maintaining conventional quality services. Triggered by the 2024 logistics issue, the Consumer Affairs Agency encourages ecommerce companies to reconsider displaying free-delivery charges aiming to reduce the burden in the logistics industry. Year by year, parcels delivered to consumers proliferate. Added with surging access to ecommerce and diversified lifestyles since the pandemic have urged consumers to demand receiving services and products at the timing suitable to their lifestyles. To solve the issues, new attempts have been addressed, such as further increase in delivery box installations, services to accept parcels or lockers at convenience stores or at railway stations, enhancement of contactless delivery, delivery by means of drones or delivery robots, etc. In October 2022, the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) has allowed “kei cars” or light automobiles to be used in the light motor truck transportation business that has conventionally used minitrucks or minivans for the transportation.  

While various challenges burden the logistics industry with shortage of drivers and the 2024 logistics issue, enhancement to get together among multiple logistics businesses for effective use of operational resources, i.e., manpower and locations, thereby to press ahead with better logistics services in the form of collaboration. So far, Japan Post and Sagawa Express, and Japan Post Group and Yamato Group have formed cooperative relationships. It should be noted how such collaborations change the positioning in the delivery business, especially among major logistics companies.

Research Outline