A Yen For U.S. Products American Retail Giants Gain Toehold In Japan

Gucci used to be the store of choice for Keiko Hayakawa, but now she can’t stop herself in The Gap, buying a T-shirt and pants on her latest shopping spree.

“I like the casual designs. And they were cheap,” said the 21-year-old student.

The trendy retailer came to Japan last September, joining other American companies scoring success in a market that was long closed to foreigners - and they’re doing it, for the most part, by slashing prices.

Even in areas previously seen as impossible to penetrate, such as household appliances and autos, “Made in the U.S.A.” is selling.

One key factor is the stronger yen, which makes American products cheaper here. The yen rose to 80 yen to the dollar at one point last year and has recently settled at about 105 yen - a 22 percent difference from its 135-yen levels in 1990.

In addition, a shift in Japanese lifestyles to a greater emphasis on time away from work has helped open doors for U.S. companies selling luxury products.

Retailers have been particularly successful in this land where $110 melons and $6 cups of coffee are the norm. The Gap is set to open its third store this month, and L.L. Bean and Eddie Bauer have seen a jump in Japanese sales.

Other industries are also cashing in on the Japanese market. General Electric Co. has sold 80,000 refrigerators and Whirlpool Corp. is introducing two washing machine models this month to the Japanese market.

General Motors Corp.’s Chevrolet Cavalier, marketed this year under the Toyota brand, has outdone company forecasts, selling 1,800 cars in the first month.

The Big Three U.S. automakers are eager to cash in on last summer’s market-opening bilateral trade accord that promised to raise American auto and auto parts sales in Japan. Last year, U.S. automakers boosted their sales in Japan by nearly 50 percent to 97,380 vehicles.

Even couch potatoes are buying American. U.S. sofas make up 60 percent of the big Otsuka International Design Center’s sofa sales.

Ordering bulk shipments directly to U.S. makers, bypassing import firms, has kept prices lower than similar Japanese products, company spokeswoman Kuniko Otsuka said.

The U.S. deficit with Japan shrank last year for the first time in four years, declining 9.7 percent from the previous year to $59.28 billion.

The Clinton administration says U.S. exports to Japan are increasing four times faster than are Japanese sales in the United States.

While the Japanese are buying American goods in mass, they are paying more for the same products available in the states.

At L.L. Bean, a pair of jeans that goes for $30 in the United States sells for $46. Same holds true at the Gap, where jeans run for $64 each. That’s a 30 percent price increase over U.S. rates but considered a bargain in Japan, where jeans sell for about $75.

Officials at San Francisco-based Gap acknowledge that prices at its Japanese stores are set not to correspond with its U.S. rates, but to prices of comparable products in Japan. That’s to compensate for the higher costs of rent, labor, construction and advertising.

“I don’t think it’s because people are trying to take advantage of the Japanese consumer,” said Gap International President William Fisher. “It’s expensive to operate a business in Japan.”

The popularity of U.S. goods also reflects a wider shift in Japanese lifestyles to a greater emphasis on time away from work. And more Japanese are traveling abroad.

One reason Gap set up shop in Tokyo was that it found Japanese were spending some $66 million a year at U.S. Gap stores.