Major Japanese Drugstores FY2026 Full Year: Tsuruha Reclaims Top Spot

Japan's drugstore landscape has experienced a massive shakeup. Following the management integration of Tsuruha and Welcia, the market now boasts four companies with revenues exceeding 1 trillion yen. This shift is driven by three key factors. First, the rapid resurgence of inbound tourism demand has boosted sales of cosmetics and duty-free medicines in urban areas. Second, consumers' strong thrift-minded behavior has benefited chains using low-priced food items as a draw. Lastly, aggressive M&A activities targeting regional supermarkets have intensified as players rush to secure regional market share.

The clear winner is MatsukiyoCocokara, which posted revenues of 1.1174 trillion yen and recorded the industry's highest operating profit margin at 7.6%. The company leveraged its highly profitable cosmetics lineup and the strength of its urban storefronts. Overall, the sector is experiencing a polarization between high-margin models and low-price strategies. On the other end, Kusuri no Aoki struggled, with net profit falling 3.7% year on year. Although its revenue grew by 13%, the heavy cost of rapid store expansion weighed on its bottom line, making this a classic case of a temporary profit decline driven by heavy upfront investment.

Key competitors are adopting diverse survival strategies. Cosmos has increased its grocery ratio to approximately 63%, driving customer foot traffic through aggressive low pricing to surpass 1.0995 trillion yen in sales. In contrast, Sugi HD relies on its in-store pharmacies as a primary weapon. Boosted by its acquisition of Seki Yakuhin, Sugi HD saw its net profit surge by a massive 75.1% year on year. Meanwhile, Sundrug continues to differentiate itself through its network of low-cost discount stores.

The industry hierarchy has been dramatically reshuffled. Tsuruha took over Welcia as a subsidiary, propelling its revenue to 1.4506 trillion yen. Moving forward, a new market order driven by economies of scale will take shape. The sector has officially entered an oligopoly dominated by four giants: Tsuruha, MatsukiyoCocokara, Sugi HD, and Cosmos. Mid-tier operators are now forced to choose between being acquired or carving out highly specialized niches.

Despite the rapid growth, several challenges loom on the horizon:

• Rising store operating costs, including electricity bills
• Severe labor shortages of pharmacists and store staff
• Margin pressure from low-margin grocery sales
• Profit squeeze from revisions to official dispensing fee rates

Job seekers should closely examine each firm's distinct business model. Pharmacy-centric operators like Sugi HD and MatsukiyoCocokara enjoy higher margins and offer stable compensation packages. On the other hand, rapidly expanding players like Cosmos and Kusuri no Aoki are opening stores at an aggressive pace. This rapid expansion offers young professionals fast-track opportunities for early promotion and hands-on experience in store development. Aspiring candidates should align their employer choice with their personal career goals.