Bloomberg News

Green Curtain Sales Surge as Tokyo Faces Power Shortage

June 15, 2011

(Updates with closing share price in eighth paragraph)

June 15 (Bloomberg) -- “Green curtain” gardening kits sales are surging, shoppers are buying clothes designed to help them stay cool and a pizzeria owner is losing weight as Tokyo residents brace for a summer with less air conditioning.

Sales of gear to grow goya vines that provide shade for buildings have jumped ninefold this year at Rakuten Inc., Japan’s biggest online retailer. Hitachi Ltd., the country’s second-biggest private employer, is draping factories with the bitter gourd plants and handing out seeds to employees for use at home, a step electronic components maker Kyocera Corp. is also taking.

“Our office will be like a steam sauna this summer,” said Yasuo Kawada, a 59-year-old employee at a Tokyo-based office equipment maker. “We can’t open windows. Coping will be tough.”

Fast Retailing Co.’s Uniqlo casual clothing sales are surging after Tokyo’s power monopoly asked companies to set thermostats to 28 degrees Celsius (82 degrees Fahrenheit) and reduce power use 15 percent. The increase in purchases of goods to stay cool comes as eastern Japan has been left short of power capacity by the March 11 earthquake and tsunami that knocked out a nuclear plant.

Some investors may have underestimated the extent to which Japanese consumers are willing to alter their lifestyles, according to Graham Elliott, chief executive officer of MF Global FXA Securities Ltd.

“The main impact will be with companies like Fast Retailing, with positive impact on convenience stores and some electrical sales,” he said.

Cool Clothes

Fast Retailing said the government’s “Super Cool Biz” campaign to cut office air conditioning by easing dress codes is already pushing up sales of clothes that wick away sweat. Toray Industries Inc. helped develop the cooling fabrics.

“Wearing our clothes actually keeps you cooler than when you’re naked,” Fast Retailing Chief Operating Officer Naoki Otoma said. The company’s stock has lost 4.1 percent since the earthquake, compared with an 11 percent slide for the broader Topix index.

The clothing retailer, Asia’s biggest, expects sales of chino pants to double and of polo shirts to jump 50 percent this year, Otoma said. Fast Retailing said 97 percent of employers in the Greater Tokyo area intend to conserve energy this summer, based on its survey of 400 workers.

Power Shortage

Elliott attributes the change in purchasing habits partly to “the way the nation responds almost unilaterally in a crisis.” The relaxed office dress codes aimed at cutting air-conditioning, begun in 2005 and accelerated this year as “Super Cool Biz” helped “start the trend toward more environmentally sensitive thinking,” he said.

The crippled Fukushima Dai-Ichi plant northeast of Tokyo and mandatory maintenance mean only 14 of the nation’s 54 nuclear reactors may be operating in August, according to Bloomberg calculations. Temperatures may rise to as high as 40 degrees Celsius (104 Fahrenheit) that month.

The changes in habits are spreading beyond apparel choices and gardening.

“I will lose weight to help stay cooler,” and cut back on air-conditioning use, said Takehiro Katayose, 35, who runs a Tokyo pizzeria and plans to cut his body fat to 15 percent from about 17 percent. “I will also cut my hair shorter. I’m doing what I can do, even though it may have little impact.”

Lace Curtains

Sales of home appliances in April rose 19.7 percent from the previous year to 175.3 billion yen, led by a 79.6 percent rise in sales of energy-saving air conditioners, Japan’s Electrical Manufacturer’s Association said May 25. Sales of fans rose 145 percent to 454,000 units, and refrigerators rose 19 percent to 370,000 units.

Aeon Co., the country’s second-biggest retailer, aims to raise sales of electric fans by 50 percent. It plans to increase by 20 percent the sales of lace curtains that it said block 80 percent of ultra-violet rays.

The operator of the Jusco supermarket chain will also offer credit worth 200 yen to customers who bring in power bills showing they’ve reduced use of electricity by at least 15 percent in July, Aeon said May 23.

Shiseido Co., Japan’s biggest cosmetics maker, has boosted shipments of the mint-scented Sea Breeze lotion by 30 percent from the end of February to mid May, spokeswoman Megumi Kinukawa said.

‘Little Efforts’

McDonald’s Holdings Co. (Japan) recommends its employees go on leave from Aug. 1 to Aug. 5 to allow it to shut most of its headquarters, spokesman Kazuyuki Hagiwara said.

Seven & I, Japan’s biggest retailer, plans to spend 10 billion yen on measures to cut electricity use by 25 percent at its 6,000 7-Eleven convenience stores in Tokyo and surrounding areas. The steps include installing light- emitting diode lights at 5,000 stores and solar panels at 1,000 outlets.

“It’s hard to imagine we can resolve this power-supply problem anytime soon,” said Toshihiro Nagahama, chief economist at Dai-ichi Life Research Institute Inc. in Tokyo. “Still, little efforts multiplied a millionfold can help mitigate the impact.”

--With assistance from Shunichi Ozasa and Mike Firn in Tokyo. Editors: Dave McCombs, Frank Longid

To contact the reporters on this story: Naoko Fujimura in Tokyo at nfujimura@bloomberg.net; Anna Mukai in Tokyo at amukai1@bloomberg.net

To contact the editor responsible for this story: Frank Longid at flongid@bloomberg.net; Kae Inoue at kinoue@bloomberg.net


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