This paper seeks to elucidate the process through which a kimono cloth store transformed into a modern department store. Additionally, I will analyze the influence of the popularization that occurred as part of that transformation on department store management, and consider the relation between the formation of a mass-consumption society and department-store management. I shall assess the transformation from three viewpoints: (1) expansion of stores, (2) diversification of merchandise sold, and (3) the development of various functions of the department system.
Matsuzakaya's transformation from kimono dealer to department store occurred during the 1910s. At that time another Japanese department store, Mitsukoshi, had already been established. In order to compete with Mitsukoshi, Matsuzakaya assembled a line of highgrade products, pioneered modern equipment and fixtures, and thus contributed to the formation of the “department store culture.” However, due to price surges during the final stage of World War I, as well as the economic downturn, which followed the war, there arose a desire among consumers for discount sales which outpaced the anticipation of Matsuzakaya.
In response to that desire, Matsuzakaya advanced lines completely corresponding to the bargain sale expectation of consumers during the 1920s. Because of the intense competition among department stores during that period, Matsuzakaya adopted a completely different business strategy in which they purchased merchandise directly from the places of production, and advertised merchandise in cooperation with the places of production. As a result, from the second half of the 1920s, Matsuzakaya expanded their stores rapidly, and began to carry not only high-grade products, but also everyday items. Moreover, Matsuzakaya diversified and increased the kinds of products sold. As a result, not only the highgrade articles but also these everyday articles gradually proved to be an important profit source for Matsuzakaya.
Finally, as a result of Matsuzakaya's pursuit of efficiencies based on cost consciousness during the Showa Depression at the beginning of the 1930s, the functioning of the merchandise department system helped Matsuzakaya to undertake an all-inclusive transformation into a department store. In light of that, I argue that the transformation into a department store and the popularization of Matsuzakaya's product line progressed in a parallel fashion, in which the two functioned in a reciprocal relationship.

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