Ito-Yokado owner pursuing lower prices to attract inflation-hit shoppers, CEO says

TOKYO, Sept 18 : Supermarket and retail group York Holdings is expanding its slate of lower-cost products to attract consumers whose finances have been hit by inflation, its chief executive said.

After being sold by Seven & i to private equity firm Bain Capital last year, the operator of the Ito-Yokado and York-Benimaru supermarket chains is looking to expand its own product lineup and adjust prices to better fit the competitive industry, Chief Executive Seiichiro Itabashi said in an interview with Reuters on Thursday.

Household finances are getting squeezed and pressure from fast-growing discount supermarket brands is forcing a change in strategy, Itabashi said, as the firm aims for a 2028 initial public offering. 

"Many customer groups are extremely sensitive to price," he said. "If you don't get price rises under inflation right, it means losing customers." 

On Friday, the Bank of Japan raised interest rates to 1.25 per cent to counter persistent inflation pressures driven by soaring oil costs.

By the end of the 2026 financial year, York Holdings wants to offer 400 low-cost branded items and it is currently considering setting different prices for this range at its supermarkets compared to Seven & i's 7-Eleven convenience stores, Itabashi said.

“When we were under Seven & i, private-label offerings were heavily oriented toward convenience stores, leaving a very limited selection of budget-tier products compared to rival supermarkets,” Itabashi said.

Bain has been advising on pricing, drawing on its experience in Japanese retail acquisitions, including restaurant chain Skylark in 2011 and pharmacy chain Kirindo Holdings in 2020.

York, which also includes general goods store Loft and baby goods chain Akachan Honpo, was carved out of Seven & i's sprawling holdings in the midst of its takeover battle with rival convenience store operator Alimentation Couche-Tard in 2025.

Seven & i has retained a 35 per cent shareholding in York and currently, company-branded products carry the same price in both York's supermarkets and 7-Eleven convenience stores.

A public listing would come at the earliest in 2028 and York is investing in its stores to broaden its customer base - which skews older - and shake off its pricey image, Itabashi said.

York has no plans to sell its stakes in non-supermarket businesses like Loft and Akachan Honpo and would consider acquisitions to grow its core businesses, but it has no concrete M&A plans at present, he said.

"The top 10 players only hold about a 20 per cent share of the supermarket market," Itabashi said. "To survive, the top players will ultimately need to control about half of the market. We must make sure we don't fall behind."