Nov. 12, 2015
Soukai Drug Co.,Ltd.
Soukai Drug to acquire major online vendor of pet supplies
Sumitomo Corporation (head office: Chuo-ku, Tokyo; president: Kuniharu Nakamura) is pleased to announce that its subsidiary Soukai Drug Co., Ltd. (head office: Chiyoda-ku, Tokyo; president: Noriaki Komori; hereinafter, “Soukai Drug”), has concluded an agreement to acquire 100% of the shares of COCORO Corporation (head office: Okayama, Okayama Prefecture; president: Osamu Hirayama; hereinafter, “COCORO”), a subsidiary of a major pet food and pet supply wholesaler Echo Trading Co., Ltd. (head office: Nishinomiya, Hyogo Prefecture; president: Kazuhiko Takahashi; hereinafter, “Echo”). Soukai Drug is seeking through this acquisition to become a top player in the domestic online market for pet supplies.
Sumitomo Corporation estimates that the pet supply market in Japan is around 680 billion yen (2014), and its market size is likely to remain stable because more and more people have started to regard their pets as family members. Although most pet supplies are currently purchased at home centers and other retail shops, a growing percentage of customers are making their purchases online looking for much more varied lineup of products and attracted by the convenience of having pet food, cat litter and other heavy items delivered straight to their doors.
Soukai Drug is a company specializing in online sales of a broad range of products at reasonable prices -- its selection of nearly 180,000 products includes not only pet supplies, but also mineral water, health food products, and detergents as well as beauty care appliances, kitchen appliances and other house wares – and it operates multiple specialty stores such as Soukai Drug, Soukai Pet Store, and Soukai Drink on the Internet. Since Sumitomo Corporation acquired a stake in the company in 2004, Soukai Drug has gone on to win the Rakuten Grand Prix for “Shop of the Year” for six consecutive years, Yahoo! Shopping’s “Best Store of the Year” award, and DeNA Shopping’s “Best Shop Grand Award,” with the accolades of many customers.
COCORO is offering pet supplies through a number of online shops such as Kaiteki Neko Seikatsu, Kaiteki Inu Seikatsu, Kaiteki Pet Seikatsu and PETLAND, as one of the largest online vendors of pet supplies. After Soukai Drug acquires 100% of COCORO’s shares and ultimately absorbs COCORO into its own entity, it intends to continue operating these online shops.
Soukai Drug will pursue deeper business collaboration and bigger purchasing scale with Echo through this acquisition. As well as optimizing supply chains and realizing other cost improvements, the company will strive to boost its pet supply sales to 10 billion yen in the near future (combined sales of Soukai Drug and COCORO are currently a little over 5 billion yen) to become the top player in domestic online sales of pet supplies.
In Japan, Sumitomo Corporation has been pursuing a broad spectrum of retail businesses – online shopping, supermarkets, home shopping, drug stores etc. – through both brick-and-mortar and virtual stores. In recent years along with expanding its retail business in the domestic market, Sumitomo Corporation has placed a strategic focus on expanding its retail businesses in Asia among the other overseas retail operations that are being developed. Sumitomo Corporation continues to see opportunities in people’s changes of buying patterns and lifestyles, and seeks to keep expanding its business in the retail sector.
|Company name||:||Soukai Drug Co., Ltd.|
|Head office||:||Chiyoda-ku, Tokyo|
|Description of business||:||Internet sales of daily necessities, groceries, pet supplies, etc.|
|Capital||:||300 million yen|
|Shareholder composition||:||Sumitomo Corporation: 94%; others: 6%|
|Products handled||:||Daily necessities, groceries, pet supplies, and a wide range of other consumer products|
|Company name||:||COCORO Corporation|
|Head office||:||Okayama, Okayama Prefecture|
|Description of business||:||Internet sales of pet supplies|
|Shareholder composition||:||Echo Trading Co., Ltd.: 100%|
|Products handled||:||Pet food, pet supplies, and a wide range of other pet supplies|
Corporate Communications Department,