Could high overhead costs kill Japan Home, Daiso amid rise of e-commerce? Analysts weigh in
The outlook seems dim, but better manpower management and data analytics may sharpen their edge, they say
Dollar stores in Singapore, such as Japan Home and Daiso, may face challenges due to high overhead costs resulting from rising labor and rental expenses, according to analysts. Japan Home, which operated six outlets in Singapore, saw its losses more than double in the 2025 financial year, reaching S$2.3 million. The chain's remaining stores were licensed to Radha Exports, which also owns the Daiso brand.
Analysts suggest that Japan Home's losses may have been caused by thin margins, making it difficult to cover rental and labor costs. The company's declining profits over the past three years also indicate a downward trend. Meanwhile, Daiso has closed three outlets in 2026, joining the trend of other dollar stores shuttering their branches.
The main threat to these stores is the rise of e-commerce platforms like Taobao, Pinduoduo, and TikTok Shop, which do not require physical storefronts and have significantly lower overhead costs. These online platforms often provide consumers with the same convenience as physical stores, including same-day delivery options. Experts recommend that dollar stores must improve their manpower management and utilize data analytics to identify profitable products and reduce costs, potentially giving them a competitive edge in the challenging market environment.
Written by urgent.news from The Business Times - Companies & Markets's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
This story
This is one outlet's version. Read the fullest account.
