Reuse and Recycling Business
For Business Expansion
We have achieved stable progress in the purchase of used PCs and large home appliances as we had expected, through efforts such as promoting replacement purchases of PCs in collaboration with business partners and ensuring customer convenience by purchasing used large home appliances at the time of delivering new ones.
As new services, we started to purchase cooking ranges, cleaners, and rice cookers. These items are not covered by our delivery service. Therefore, we reviewed and improved point-of-purchase ads and inserts to announce the new system and encourage customers to bring their used itemsEnvironmental Business when they visit our stores to purchase new ones.
Customers seem to become increasingly selective when purchasing things, in consideration of their current lifestyles. If we can continuously provide goods with truly necessary functions at a reasonable price range, the market dealing with products for reuse has a potential to further expand. Anticipating such market environment, we will endeavor to enhance convenience to facilitate customers' use of the Yamada Denki Group's purchasing services and to increase the number of used items we purchase and the number of products for reuse we provide, thereby contributing to mitigating environmental impact through the reduction of CO2 emissions.
Efforts for Enhancing Production Effi ciency
We commenced the operation of the Shiga Reuse and Recycle Center in October 2015. Until then, there was only one production site, but now we have two sites, one in the eastern part and the other in the western part of Japan. Having two production sites: one in the east and one in the west, has reduced distribution costs and increased production capacity, and has made it possible for us to supply products for reuse that we produced from used products we had purchased in shorter time. Additionally, we are trying to acquire higher repair skills as a new initiative so that we can produce and supply more products for reuse.
Steady Expansion of Business Performance
The number of newly opened outlet & reuse stores was two, and the total sales increased by 1.5 times and the number of reused products we sold also increased by 1.5 times. This is the second year since we started the reuse and recycling business, but the existing stores have maintained steady performance. We have purchased approximately 10,000 units per month and the number reached approximately 130,000 units for the whole year and washing machines, refrigerators, and televisions accounted for the majority thereof. We will further increase purchases and expand the range of products to secure inventory of products for reuse. For example, we have so far purchased only working products, but will start purchasing disabled products as well, which our special staff with high skills will repair into usable products by replacing components.
Number of Customers on a Steady Rise
Customers seeking products for reuse are mainly unmarried, centered on students. In 2016, products for reuse also sold well for business purposes, such as for company housing, dormitories, and business offices. Strategically, we increased the display of leading products (TVs, refrigerators, and washing machines) and also increased the lineup and started the sale of cooking ranges at all stores from the end of 2016.
Outlet stores have continued to attract a broader range of customers and the number of customers is increasing. Second-hand clothes were initially sold at only fi ve stores but Kadoma outlet store and Kaizuka outlet store also started to purchase and sell secondhand clothes, and the overall sales and profi ts are improving.
Opening of Stores in New Areas
In 2017, we will review our sales strategies and raise the percentage of products for reuse to increase the earning rate. When opening a new outlet & reuse store, it is very important to ascertain trade areas. Now, we are going to open new stores in large urban areas where we have had no stores. We plan to increase the number of stores to around 23 from 19 at present (as of March 2017).