Japan e-commerce shifts toward transparent shipping cost labeling

Japanese e-commerce companies are shifting away from the standard “free shipping” label toward more transparent descriptions, such as “shipping covered by company.” This change follows guidance from the Consumer Affairs Agency, which has encouraged businesses to clarify who bears the cost of delivery. While the agency decided against legal regulations on the term itself, it is requesting voluntary transparency to help consumers understand actual product prices.

The shift is driven by the “2024 logistics problem,” where new limits on truck driver overtime hours have impacted delivery capacity. To address these challenges, the Logistics Efficiency Act has been amended, imposing new obligations on shippers to improve loading rates and reduce waiting times.

Industry advocates suggest that separating shipping costs from product prices allows for fairer competition. Under the “free shipping” model, small businesses often struggle to compete with large corporations that can spread shipping costs more thinly across high volumes. Transparent pricing allows consumers to compare the base price of goods more accurately across different sellers.