Xymax Real Estate Institute

RESEARCH REPORT

Fact-Finding Study on Information Management ofCommercial Outlets 2018
Findings from questionnaires and interviews with commercial operators

November 29, 2018

In partnership with the laboratory of Professor Yukio Komatsu of the Department of Architecture at Waseda
University,*1 Xymax Real Estate Institute (hereinafter referred to as “Xymax REI”) conducted the “Fact-Finding
Study on Information Management of Commercial Outlets 2018.” This study consists of questionnaires andinterviews with commercial operators that operate or control multiple outlets (hereinafter referred to as“Operators”),*2 conducted at the same time as the “Fact-Finding Study on the Real Estate Strategy ofCommercial Outlets 2018,”*3 which was published by Xymax REI on the same day.
In order to formulate and implement real estate strategies of stores (i.e. how to utilize store real estate), suchas new openings, renovations, and early termination of contract, it is essential to manage various information
as a basis, including store development, sales performance, customer profiles, store assets, and taxes. This
report is a summary of the reality of information management, including how Operators actually manage
information and the challenges involved.
*1 Laboratory of Professor Yukio Komatsu, Department of Architecture, Waseda University: http://www.waseda.jp/sem-ykom/*2 Survey targets: Retailers, restaurant operators, entertainment providers, and service providers aimed at personal consumption
with net sales of 3 billion yen or more for the latest fiscal year surveyed by Tokyo Shoko Research (an overview of the survey isprovided at the end of the report).
*3 https://www.xymax.co.jp/english/news_research/?type=research(Related survey) “Fact-Finding Study on the Opening & Closing of Commercial Outlets 2017,” published on September 29, 2017https://www.xymax.co.jp/english/news_research/?type=research

Key FindingsOf major store information, the top information items whose entire data was managed digitallywere “customer information,” “trend of net sales and P/L,” and “residual value & taxes and publicdues.”

The top store information items with data of all stores consolidated at the headquarters were“trend of net sales and P/L,” “contractual information of the property,” “lease contract and store
asset ledger,” and “residual value & taxes and public dues.”

Around 60% of Operators had a department or staff dedicated to managing store information.



The top replies in terms of problems that may occur in managing store information and thefrequency of actual occurrences were “store information not updated to the latest data,” “loss ofsome store information upon change in staff due to poor handover,” and “incorrect entry of
information.”

An Operator said in the interviews that they managed store information centrally acrossdepartments to formulate real estate strategies of stores efficiently.

Fact-Finding Study on Information Management of Commercial Outlets 2018
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

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RESEARCH REPORT｜ Xymax Real Estate Institute

1. Management Status of Store Information
The industries and outlets (profile of respondent Operators) are the same as in the “Fact-Finding Study on
the Real Estate Strategy of Commercial Outlets 2018” *4 published by Xymax REI on the same day.
*4 https://www.xymax.co.jp/english/news_research/?type=research

1-1. Management format of store information
When asked about the management format of the following 11 major store information items, the items
whose entire data was digitalized were “customer information” (46%), “trend of net sales and P/L” (46%), and“residual value & taxes and public dues” (42%) (Figure 1).
Figure 1: Management Format of Store Information (Single Answer; n=391)

Interviews with the Operators revealed that many Operators had set up a database (i.e. able to extract andedit information under any given condition) for “customer information,” “trend of net sales and P/L,” and“residual value & taxes and public dues.”
Popular digitalization methods of information items other than the above three included creating PDFs of
Excel-managed or paper materials and storing them in the internal server.

Fact-Finding Study on Information Management of Commercial Outlets 2018
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

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RESEARCH REPORT｜ Xymax Real Estate Institute1-2. Store information consolidated at headquarters
We asked Operators which store information had the data of all stores consolidated at the headquarters (orbranch office, area, etc.). The result was that large percentages of Operators consolidated information at their
headquarters overall, especially in “trend of net sales and P/L,” “contractual information of the property,” “lease
contract and store asset ledger,” and “residual value & taxes and public dues,” which were consolidated at theheadquarters by more than 90% of Operators.
On the other hand, the percentage of Operators consolidating “past negotiation history” and “information on
key person at negotiating counterparty” at their headquarters was relatively low (60% level) (Figure 2).
Figure 2: Store Information Consolidated at Headquarters (Multiple Answers; n=391)

When we asked Operators where the information that was not consolidated at the headquarters was stored,
the top replies included “supplier or outsourcee” and “information is not stored in the first place.” There werehardly any cases of “information is at the store only.”
Several Operators commented that the management of past negotiation history and information on the key
person at the negotiating counterparty still relied on personal ability.

Fact-Finding Study on Information Management of Commercial Outlets 2018
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

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RESEARCH REPORT｜ Xymax Real Estate Institute

2. Method and System of Store Information Management
As for the specific method and system of store information management, around 60% of Operators repliedthat “there is a department or staff dedicated to managing store information” applied or applied somewhat(Figure 3).
Figure 3: Method and System of Store Information Mangement (Multiple Answers; n=391)

When asked in the interviews about the department that managed information of existing stores, many
Operators replied that different information was managed by different departments, for example, contractual
information by the development department, customer information by the sales department, and residual
value by the accounting department, and that the necessary store information was gathered each time a realestate strategy was formulated. However, few Operators saw the situation as a problem.
Among Operators with relatively few stores, there were cases where all information was managed by thecontrol department or by a separate team from the new store openings team (development department) thatwas dedicated to formulating and drafting real estate strategies such as store renovations and terminations,with a staff member dedicated to managing existing store information centrally across departments.

Fact-Finding Study on Information Management of Commercial Outlets 2018
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

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RESEARCH REPORT｜ Xymax Real Estate Institute

3. Frequency of Problem Cases that Occurred in Store
Information Management
When we asked about problem cases that may occur in store information management and the frequency ofactual occurrences, the top three cases that occurred either frequently or sometimes were “store information
not updated to the latest data” (29%), “loss of some store information upon change in staff due to poor
handover” (28%), and “incorrect entry of information” (25%) (Figure 4).
Figure 4: Frequency of Problem Cases in Store Information Management (Single Answer; n=391)

An Operator said in the interviews that the most troublesome task in managing store information wasmaintenance. In Excel-managed data it was relatively frequent to forget updating the data to the latest
information as well as making incorrect entries, since information was entered manually. As for creating a
database of information, one Operator commented that the priority was on information such as sales that is
updated on a daily basis and highly important, and that the company had no plan to move forward with thecreation of a database of store development information such as contracts due to cost reasons. The Operator
added that some property information was still being sent from real estate brokerages via fax and that the
management system had not hardly changed for more than 20 years.

Fact-Finding Study on Information Management of Commercial Outlets 2018
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

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RESEARCH REPORT｜ Xymax Real Estate Institute

4. Comments Obtained from Interviews with Operators<Management situation of store information>
・ Store information is managed centrally across departments to formulate real estate strategies of stores
efficiently. (Retail (food))・ Information is basically managed in Excel. Since we have no tenants, managing in Excel is no problem.
Management and storage are done at different dedicated departments. (Retail (food))・ Some old contracts are still in paper form, which are currently being digitalized. There were cases where we
could not find drawings. (Retail (food))
・ All contracts are in paper. There have been no discussions on digitalizing information management within
the company. (Retail (non-food))
・ We started digitalization about 10 years ago. We decided to do so since it is an information-oriented
society. (Retail (non-food))
・ We have a database of sales and customer information, which are data that we create by ourselves. The
information provided by developers is managed in paper, PDF, or Excel, and is not made into a database.
(Retail (non-food))<Method and system of store information management>
・ Information of new stores is handed over to the real estate management group after store opening anddigitalized. (Retail (food))・ There are no manuals, and some information is linked to individuals or stores. (Retail (food))・ The store manager can see the sales of his/her own store and other stores but not P/L. (Retail (non-food))
・ Management has access to store information at all times. The stores can check the sales of all stores in thedata transmitted on a daily basis. For P/L, however, they can only see their own. (Retail (non-food))・ Information is held at each department. There is no inconvenience with the status quo. (Entertainment)<Problem cases and frequency>
・ Information on contract renewal negotiations is shared among the staff in charge by producing a list ofcontracts that expire each period. Renewals are not forgotten. (Restaurant)<Operational and organizational issues>
・ Decision-making is slow since management strategies are developed by the Group and HD, and various
decisions must be made at the meeting that takes place once a month. (Retail (food))・ Coordination sometimes took time when there were several landowners, but recently there has been anegotiation agent that acts as a coordinator of the landowners. (Retail (food))・ Coordination with store owners takes time when opening a new store in rural areas since drawings often
do not remain or the building has been expanded without any records. (Retail (non-food))・ It is not possible to analyze customer profiles since we do not have our own point cards, although there is a
POS register. (Retail (non-food))・ Renovation schedules are tight since we want to minimize sales loss while the store is closed. (Retail(non-food))
・ Budget/process management are meticulous and strict partly since the parent company is a fund.
(Restaurant)
・ Cost coordination for new or renovated outlets takes time, especially for construction work B. It is not rare

Fact-Finding Study on Information Management of Commercial Outlets 2018
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

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RESEARCH REPORT｜ Xymax Real Estate Institute
to be presented with a quote that is double the budget. (Restaurant)
・ Government instructions are strict such as in compliance and personal information management. (Service)

5. Summary
The questionnaires and interviews have revealed the reality of information management of commercial
outlets. The levels of management of store information vary, and for most Operators, digitalization of
information does not necessarily mean the creation of a database. While there are some cases where
information management relies on personal ability, we believe that the exchange of store information between
departments are still carried out on a personal level at relatively many Operators.
In the near future, all business processes of Operators are likely to undergo a fundamental change due to thefurther evolution of IT technologies and the prevalence of AI. This also applies to store information
management, with the capabilities of the management system and operation affecting improvements inbusiness efficiency and productivity, differentiation from rival operators, and the ability to secure an advantage.
Operators may have to renew their understanding of the importance of information management informulating real estate strategies of stores and develop a vision for the future now.
Xymax REI intends to continue its research on commercial facilities and outlets to publish useful information.

Fact-Finding Study on Information Management of Commercial Outlets 2018
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

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RESEARCH REPORT｜ Xymax Real Estate Institute

Survey Overview
PeriodJune – September 2018

TargetOf retailers (food and non-food), restaurant operators, entertainment providers, and service providers*1*2
aimed at personal consumption, 5,117 business operators with net sales of 3 billion yen or more in thelatest survey year*3*1: Industries and categories that currently operate in shopping centers, commercial buildings, or roadside outlets,
which are currently Japan’s main commercial facilities, based on Japan’s industry classification by the Ministry ofInternal Affairs and Communications*2: Target companies of the service industry are beauty & barber, travel, education, insurance, and real estatecompanies that operate outlets in a commercial facility.
*3: Targets were extracted based on data by Tokyo Shoko Research

No. of valid
responses

Questionnaire: 391 companies (response rate: 7.6%); interview: 18 companies

Geographicalcoverage

Nationwide

MethodQuestionnaire survey by post or online, and interview

Surveycontents

I. Business and outlet
II. Real estate strategy of stores: Refer to https://www.xymax.co.jp/english/news_research/?type=research
III. Management of store information

Contact for inquiries concerning this report
Xymax Real Estate Institutehttps://soken.xymax.co.jp
PHONE: +81 3 3596 1477 | FAX: +81 3 3596 1478 | E-MAIL: info-rei@xymax.co.jp

Fact-Finding Study on Information Management of Commercial Outlets 2018
The contents of this report are as of the time of writing. Xymax Real Estate Institute does not guarantee their accuracy or completeness. This report may not be
reproduced, cited, transmitted, distributed, or reprinted without prior permission of Xymax Real Estate Institute.
Copyright © 2019 Xymax Real Estate Institute Corporation. All rights reserved.

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