Economic conditions in Japan are smiling on retailers, as March sales saw year-over-year improvements that were better than they've been in the past 11 years. According to BBC News, the 11 percent increase between March 2013 and last month may have been due in part to the sales tax increase.

The Japanese government raised the sales tax from 5 to 8 percent, and the new rate went into effect April 1, so shoppers may have been buying more than usual to take advantage of tax rates while they were still low. This is the first time Japanese consumers have seen a hike in retail taxes since 1997, and Reuters reported that a similar spending increase took place prior to the last time sales taxes was raised.

Japanese retailers are preparing for a dip in sales in April, as it's likely consumers will spend less as they adjust to the higher tax rates. However, Reuters stated that this dip should not be lower than the expectations of the central bank.

Retailers can make moves to improve their sales numbers, such as offering discounts that will offset the cost of the tax, providing free or reduced-rate shipping options viz ecommerce software or providing customer loyalty programs that offer perks and rewards at the point of sale.

This entry was posted by Retail Pro on Wednesday, April 30th, 2014 at 8:27 am .