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Japan: After The Earthquake & Tsunami

In a special report, Home Living speaks to furniture stores in the coastal areas of Sendai city, Miyagi refecture, the area most severely affected by the Great East Japan Earthquake.

The 8.9-magnitude earthquake, which was centred near the east coast of Japan, killed hundreds of people, caused the formation of 30-foot walls of water that swept across rice fields, engulfed entire towns, dragged houses onto highways, and tossed cars and boats like toys. Some waves reached 10 kilometres inland in Miyagi Prefecture on Japan’s east coast.

The quake and following tsunamis caused serious damage in the coastal cities of Natori city, site of Sendai Airport, and Iwanuma city. In Natori city, as of April 26, 890 were confirmed dead, 231 were missing, and 1,187 were evacuated. In Iwanuma city, 172 were confirmed dead, 14 were missing, and 483 were evacuated. The Sendai-East highway, our kilometres from the coast, played a pivotal role. The east side of the highway was completely destroyed by the tsunami while the west side suffered slight damage because, though barely, the highway held back the waves.

The extent of the damage and current customer needs of the stores differ significantly depending on their distance from the coast. The situations of tsunami-hit stores cannot be described in just a few words, such as ‘disaster victims’ and ‘reconstruction needs.’ One thing we can say is that all the stores are making utmost efforts to meet the needs of their customers.

BUSINESS AS USUAL
A street known as ‘Furniture Town Honcho’ is located near the Miyagi prefectural government office, on the west side of JR Sendai station. Thanks to firm ground around the station, most furniture stores in the area suffered little structural damage and opened soon after lifelines were restored. Product damage was also not as serious as elsewhere, consisting mostly of broken glassware and ceramic ware, and toppled furniture such as kitchen cupboards and chests of drawers.

Most stores in the area now operate as usual, but have shortened opening hours because of customer traffic. After departmental stores close for the day, customers disappear from the shopping street, and the whole town is plunged into darkness due to sweeping municipal power saving programs.

On the other hand, some people say the shopping area near Sendai Station attracts more customers than before because the suburban large shopping malls have been closed since the disaster.

Norihito Watanabe, manager of the Gallery Modern Space furniture store, said: “The furniture business always runs at a slow pace. No matter how difficult things are, our customers come back to buy quality furniture.” Fortunately, most people in the area suffered only slight damage to their homes, so they are now replacing furniture and household items. Price is not a concern, with consumers willing to spend. According to Mr Watanabe, most people ask for solid, quake-resistant furniture, and want accessories that stop furniture from toppling. Supplies of these products are starting to run out.

Alongside replacement demand, repair demand has increased in the devastated regions. Six furniture stores in Furniture Town Honcho —Furniture Hiroshi, Yunome Furniture, Furniture Hashimoto, Watanabe Furniture, Gallery Modern Space, and Daimaru — jointly advertised a free furniture repair service in the March issue of a local newspaper. They received up to 10 repair orders a day; and Furniture Hashimoto and Daimaru had over 30 products incoming for repair.

“Just after the disaster, we had no gasoline, so we visited customers on bicycles, carrying repair tools on our back. In any situation, we want to do our best to continue servicing customers,” said Akihiko Oya, manager of Daimaru. All furniture stores along furniture street display a common message at the entrance — ‘Look up and move on’, to inspire all who see it.

The Tokyo Interior Sendai-Minami store, located three kilometres west of the highway, closes on weekdays for clean-up and opens on weekends. Due to structural damage to the exterior wall, ceiling, and window frames, half the floor remains closed. When we visited the store, damaged merchandise were being sold at a discount.

STRUCTURAL & PRODUCT DAMAGE
Soumaya in Iwanuma city is located two kilometres west of the Sendai-East highway. The store’s interior and exterior walls and window frames were heavily damaged. Unfortunately, damaged products included many high-end items such as bridal furniture and Buddhist altars. All of the chests of drawers, curio cabinets, and mirrors on the second floor were damaged when they toppled. But despite the seriousness of the situation, the shop reopened two weeks after the disaster, and now all floors are restored and the shop is operating as usual.

Many customers want old furniture repaired as well as new products. Low to mid-range kitchen cupboards sell well. With the aftershocks, people are still frightened that the next big earthquake and tsunami upheaval could come today, tomorrow, anytime.

“Not only furniture but many houses were lost,” said Soumaya president Kenichi Kuwahara. “We are just grateful to be alive. Many of our customers died.”

iyagino ward in the eastern part of Sendai city suffered a quake whose magnitude registered upward of six on March 11. The area near Sendai Port was severely damaged by tsunami. Karimoku’s furniture showroom remains closed due to heavy structural damage. We could see from the main entrance that the interior wall had collapsed. Tokyo Interior Sendai Port, located one kilometre west of the coast, was flooded to above knee height when tidal waters surged through the area. The store remains closed due to serious structural damage — collapsed exterior walls and broken windows at the main entrance.

Yunome Furniture’s warehouse store was severely damaged; especially the second floor and storehouse, and some parts of the first floor remain under blue plastic sheets. Despite the situation, shoppers filled the store during our visit. Store manager Kenichiro Yunome said that they have more customers on weekends. There is certainly strong furniture demand in this area.

Shiogama city is one of the worst tsunami-hit areas with heavy property damage; the humansuffering tolls come to 21 dead, one missing, and 481 displaced as of April 26. JR Sengoku Line, which connects Sendai and Ishinomaki cities, now runs with reduced train service to Higashi-Shiogama station. The Shiogama Furniture Centre, located near JR Honshiogama station, has operations as usual but all neighbouring stores have been closed since the disaster. The trace of the tsunami surge is marked on the store wall and shows that the largest wave at above knee height.

The store building was hardly damaged, but most products were damaged by the initial tremor. The president of the Shiogama Furniture Centre, Shoichi Nagai, said, “After we restored fallen products to an upright position, they toppled again in the aftershocks. We would restore them and they would be toppled again. This continued several times.” The floor was still littered with broken products. Product damage was mostly caused by the quake; luckily, warehoused items were safe, so the store could reopen soon after the disaster. While coping with increasing repair demand, the store is willing to address all customer needs by obtaining products directly from manufacturers.

TSUNAMI-HIT FURNITURE
STORES RECOVERY
We visited furniture stores in Miyagi Prefecture on April 22 and 23. The difference in the extent of damage is large among the cities of Sendai, Shiogama, Ishinomaki, Natori, and Iwanuma. In Sendai city, as of April 26, some 622 were confirmed dead, 210 were missing, and 2,257 were evacuated. Tsunamis caused severe damage across a wide range of coastal areas. People housed in temporary shelters are still frightened by aftershocks. In downtown Sendai, nothing different at first, but a closer inspection reveals large cracks in the walls of buildings and an acute shortage of products on the shelves of convenience stores.

The Tohoku Shinkansen Line resumed service between Sendai and Fukushima stations on April 25; but as of May 10, the JR Joban Line, which connects Tokyo and Miyagi Prefecture, remains out of service between Yotsukura and Watari stations. The aftermath of the quake has not yet fully played out. Under such circumstances, most furniture stores in the downtown area operate as usual and all furniture stores share a commitment to provide as much support and service to customers as possible.

Furniture Hashimoto had many products ready for shipping at the storefront. Most people who had moved from a tsunami-hit area to the downtown area want to buy reasonably priced products for their temporary housing. To meet demand, the store delivers products in its own truck. The store reopened three days after the disaster.

President of Furniture Hashimoto, Hideki Umehara, acknowledged they have many products incoming for repair. “We are hoping that reconstruction demand will increase in the future as things are starting to settle down,” he said, “so that our customers, even those who were affected, will come back at a later date to buy quality furniture.”

Real Style Sendai, near the large shopping street in downtown Sendai, is tenanted in on old but wellbuilt building whose soundness helped minimise quake damage to products. Since the disaster, the shop has received more and more orders for custom-made built-in furniture in consideration of its earthquake resistance. Some shoppers even ask for detachable built-in products in anticipation of moving to another residence in the future.

“Our business has returned to normal, but due to the aftershocks, most people have no incentive to buy furniture,” said company president Toshiyuki Goto. Under such circumstances, the company has launched a 10 percent rebate campaign that will run until the end of September, aiming to assist the reconstruction of Sendai city. “It’s not beneficial for us to be the only store that is profitable,” said Mr Goto. “We hope the rebate plan will encourage spending at other furniture stores or restaurants or whatever else.”

With the whole town — indeed, the whole region — moving toward recovery, we can expect to see an upturn in the sales of local stores. Real Style Sendai is positively looking toward the future of the city.

SALES UP
The furniture and home furnishing sales of general merchandising stores in March amounted to approximately ¥34.63 billion (US$440 million), up one percent (unadjusted, including new stores) and down 8.8 percent (adjusted) from the same month in 2010.

Summarising March results, the Japan Chain Store Association reported total sales declined due to a sharp downturn in consumer confidence and planned power outages after the disaster. Regarding furniture sales, the association said, “Storage furniture and study desks sold well, but sofa and table sales slumped.”

Regarding bedding and home furnishing items, “Sales of futon and emergency supplies were good. Curtain sales were good but carpet sales slumped.”

APRIL SALES REMAIN CONSTANT
The furniture sales of department stores in March amounted to approximately ¥7.37 billion (US$94 million), down 2.1 percent (unadjusted) and down 1.7 percent (adjusted) from the same month the previous year.

The Japan Department Stores Association analysed March results saying: “The Great East Japan Earthquake of March 11 and following planned power outages depressed total sales mainly in the Tohoku and Kanto regions.”

However, the situation is seen getting better in April, and some stores are expecting sales growth. Total sales by mid-April remained unchanged from the previous year nationwide. The association said that department store sales were heading for recovery in April.

FURNISHING SALES SLUMPING
The home furnishing sales of home centres in March amounted to approximately ¥9.39 billion (US$119 million), down 5.8 percent from the same month the previous year, showing negative growth for the first time in six months.

In the Kanto region, bicycles, masks, emergency supplies, and DIY goods sold well due to the disaster, but gardening and interior product sales were down from results the previous month. According to the Japan DIY Industry Association said: “After the Great East Japan Earthquake, sales of emergency supplies such as batteries and flashlights sharply increased.”

PROPERTY SALES DROP
Housing starts in March totalled 63,419, down 2.4 percent from the same month the previous year. By category, owned houses totalled 22,863, up four percent from the same month last year; rental houses totalled 21,763, down 9.5 percent; and subdivisions totalled 18,104, up 4.6 percent from the same month last year.

Housing stats showed the first decline in 10 months in March. Owned houses indicated the 17th straight month of increase, and subdivisions showed the 13th straight month of increase, while rental houses showed the 6th straight month of decrease. In a statement from the Ministry of Land, Infrastructure and Transport, they said: “Although owned house and subdivisions showed positive growth on a year-on-year basis, rental houses significantly decreased, having depressed total housing starts. Rental houses with both public and private funds are on the decline.”

DOMESTIC FURNITURE SHIPPING
FIGURES UP
Total domestic wooden furniture shipments in February amounted to approximately ¥11.14 billion (US$142 million). The following four categories demonstrated an increase in both sales quantity and sales value on a year-on-year basis: kitchen cupboards (up seven percent in sales quantity and up 9.1 percent in sales value), dining chairs (up 10.1 percent in quantity and up 10.7 percent in value), tables (up 6.4 percent in quantity and up 14.7 percent in value), and other wooden furniture (up 3.5 percent in sales quantity and up 12.5 percent in sales value). Thus, among all categories, dining furniture sold well in February.

POPULARITY OF IMPORTS
Furniture imports into Japan are now favoured because of the following reasons:

• Increase in Japanese consumer and industry interested in legged furniture. These types of furniture include dining-room tables, chairs, sofas, beds, and dining-room cupboards. Since the domestic manufacturers are now more focused on production of storage furniture, more overseas manufacturers are now producing the legged furniture.
• Increased in price competitiveness.
• Increase in the number of Japanese furniture manufacturers who are forming strategic alliances with overseas counterparts to supplement existing production.
• An increasing number of Japanese furniture manufacturers purchasing Original Equipment Manufacturers (OEM) make furniture from overseas companies to remain cost competitive.

Japanese furniture consumers today pay more attention to the price of the furniture. This factor has changed the Japanese furniture market and greatly influenced the geographic composition of furniture imports. Today, about 70 percent of Japanese furniture imports are provided by Asian countries.

ABOUT THE Japan Executives Associati on of Furniture Trade & Industry
The Japan Executives Association of Furniture Trade and Industry marks its 17th anniversary this year; and the number of executive board members was increased from six to eight with the addition of new members Fumihiko Seki (President of Seki Furniture) and Ichiro Yamaguchi (President of Yamashin).

All executive members remained in their posts; Honorary Chairman, Michimasa Murauchi; Chairman, Tomonari Kato; chairperson, Tetsuro Chiba; vice-presidents, Atsumasa Kawasaki, Shigeru Ikeda, Takatoyo Yasui, and Sanzo Okada; and executive director, Akio Nitori. Junji Noguchi (president of Tokyo Bed); was elected auditor of the association, succeeding Tatsuji Fukui, who recently retired.