■Future outlook
2. Initiatives for medium- to long-term growth in the fiscal year ending 2025/2
For medium- to long-term growth, Jason ＜3080＞ is promoting corporate value improvement by developing thorough low-cost management and various management strategies, centering on the advancement of in-house IT and digital technology. The three main measures for the 2025/2 fiscal year are 1) promotion of scrap and build in stores, 2) expansion of handling JV products and PB products, and 3) creation of an efficient management and organizational system. Regarding 1), in addition to promoting low-cost store openings centered on empty properties, the plan is to thoroughly manage profits for each individual store, consider leaving low-profit stores, and also collect a wide range of M&A information that contributes to store expansion. Regarding 2), it is planned to continue to counter high prices by appealing for low prices centered on JV products, improve profit margins through SPA (manufacturing and retail business) and new PB product development, etc., and build a system to further increase production of “Shoninzawa natural water.” Regarding 3), it is planned to advance management systems by utilizing project management systems, promote labor saving in store operations, and create management systems that can handle OEM production and M&A.
In terms of comparison with other companies in the same industry, Daikokuten Bussan, a discount store headquartered in Okayama, which has strengths in low-cost management similar to the company, had sales of 270.5 billion yen, operating income of 8.9 billion yen, and an operating profit margin of 3.3% for the 2024/5 fiscal year. The scale of sales varies, but for the discount store industry, we believe that an operating margin of about 5% is the level we should aim for, and as M&A progresses and small to medium discount stores are eliminated, operations that are conscious of profit margins and aim for 5% at an early stage are required from an investor's point of view. Since it is difficult to anticipate a significant increase in gross margin ratio, the main focus should be placed on how to make sales and administration costs more efficient, and measures such as further promoting in-house production of each process such as manufacturing, sales, and delivery, and aiming for further expansion of sales per store by making everything from the company's logistics facilities to warehouse management in-house, how to reduce the number of personnel per store and proceed with operations efficiently, and considering the 24-hour operation of stores There seems to be room for further consideration.
(Written by FISCO Visiting Analyst Hiroki Nagaoka)