A number of foreign-capital retailers have set up shop in Japan since
the bubble's collapse about a decade ago. Although French cosmetics
retailer Sephora and British drug store chain Boots have subsequently
changed their minds, the Japanese players are increasingly fretting over
what impact Walmart, the world's largest retail chain, will have in
Japan and increasingly stepping up their efforts to understand the
Euro-American competition.
  
Japanese study missions going overseas have held exchanges of views with
manufacturers, logistics people, and retailers. A wide range of
predictions have been made and debated on what the foreign-capital
retailers might do at each stage of the supply chain; the
foreign-capital firms' methods have been studied and translated for the
Japanese market, or conversely used as examples of what not to do in
developing distinctive business models; and tremendous time has been
spent trying to analyze and counter what the foreign-capital retailers
are likely to do given their current situation.
  
Quite rightly, most of this has focused upon identifying and analyzing
logistics costs, rethinking established Japanese business practices, and
otherwise moving proactively to fix the problems that have historically
afflicted the industry as a whole. Indeed, the entrenched companies have
demonstrated remarkable strength in not cowering before the foreign
onslaught but quickly restructuring to meet it head-on.