Uniqlo operator, 7-Eleven plan tie-up targeting online sales

Fast Retailing Co Ltd and the operator of 7-Eleven convenience stores are planning a broad partnership this year that could turn 7-Eleven stores in Japan into pick-up spots for online purchases of Uniqlo clothing, a person familiar with the matter said.

The tie-up, which will not include an equity alliance, could also involve a new clothing brand and cooperation overseas, the person said.

Fast Retailing and Seven & i Holdings Co confirmed they were in talks on an operational tie-up in various fields but said nothing specific had been decided.

Japan's convenience stores, dominated by 7-Eleven with around a 40 percent share and among the country's most profitable retailers, are expected to take a major role as distribution spots for the retail industry as it integrates online and brick-and-mortar stores in a smartphone-connected world. That would help to boost customer traffic.

"When Japan introduced age identification cards for buying cigarettes at vending machines, a lot of people went to convenience stores to buy cigarettes. And because they bought other things as well, sales at convenience stores jumped as a result," said Hiroyuki Fukunaga, CEO of Investrust, an investment consultancy firm.

"So if people can receive Uniqlo clothes at 7-Eleven stores, then it could help lift Seven & i's sales as well," he said.

Seven & i operates some 18,000 convenience stores in Japan.

Earlier this month, e-commerce firm Rakuten Inc agreed to a partnership with delivery firm Yamato Holdings Co Ltd that lets customers pick up Rakuten orders at FamilyMart Co Ltd and Circle K Sunkus convenience stores and other locations.

Amazon Japan orders can also be picked up at FamilyMart and Lawson Inc outlets.

Fast Retailing agreed this year to tie up with Daiwa House Industry Co Ltd to offer delivery of its products purchased online using the builder's distribution business.

At midday in Tokyo, Fast Retailing shares were down 1.2 percent and Seven & i was up 1.2 percent, while the benchmark Nikkei average was flat.