Asics Continues to Expand Overseas

As part of their strategy to expand overseas Kansai-based Asics Corp. will open their first store in Holland by the end of this year.  At 550sqm, the Asics store will be the largest sport shoe store so far and the third overseas flagship after London and New York.  Selling running shoes and apparel the store will be located in Amsterdam and will be positioned as part of their global strategy to be where major marathons are held.  Following the Amsterdam store Asics will open up flagships France, Germany and Spain, each with their own uniqueness centered on the local running culture. 

Information Asics Corp.

Fast Retailing still finding new locations to open Uniqlo stores

In a bid to increase sales, Fast Retailing’s Uniqlo is expanding its partnerships with railway companies. Recent allies have included East Japan Railway Co. and Central Japan Railway Co. With these partnerships Uniqlo aims to open additional new stores inside of stations. As recently as this past Saturday Uniqlo opened an outlet in front of a renovated ticket gate at Shinjuku station, as well as last Thursday Uniqlo also opened a new outlet in Keiyo street inside the ticket gate of the Yaesu South exit at Tokyo Station. Both of these stores are both 69 sqm each, smaller in size than your regular Uniqlo shop but large enough in attaining the goal of attracting customers in and around major train stations in Tokyo which will ultimately lead to an increase in sales per unit area.

Moving forward Fast Retailing plans further expansion into train stations in Tokyo such as Shinagawa, as well as Osaka and the Kansai area.
Information Fast Retailing Inc.

Muji's Profits Fall on Weak Apparel Sales

Ryohin Keikaku Co., operator of Muji reported an 18% decline in operating profits of 10 billion for the nine months ending 23 November.  The steep decline is a result of weak apparel sales combined with even weaker margins from March to August where same-store-sales fell 8% from 2009 and again in September where same-store-sales fell 1.2% to 126 billion yen.

Data Ryohin Keikaku Co.

Lanvin (Hearts) H&M

The scene at the launch of the Lanvin (Hearts) H&M in Tokyo was more passive than would have been thought, especially as the launch fell on a public holiday. With the rain dampening some enthusiasm, there were still close to 300 hundred people lined up outside of the Shibuya store before the opening and the official Japan launch. Popular items were leopard-print pumps, a pink one-shouldered dress and a long-sleeve black dress with many of the items selling out quickly, not only in Japan but worldwide.

Data WWD

Downturn in cosmetic sales affecting Fancl

Fancl Corp reported a sales decline of 5.5% to 7.8 billion for year ending October 2010. Sales of Fancl cosmetics through their direct mail channel were weak compared to 2009 when a fall promotion was run. The decline in sales caused Fancl’s stock price to fall 4.4% or 53 yen to 1,155 yen in trading.

Data Fancl Corp & NQN

Japan Deparment Store Sales Finally Increase in the 32nd Month

After 31 straight months of same-store-sales declines at Japanese department stores, the unbelievable has happened – department store sales have increased in October, albeit the increase way only 06.% to 512.1 billion yen, it is still an increase. Department store sales in Tokyo fared slightly better at 2.7% to 128.9 billion yen –also the first sales increase in 32 months. In fact the sales increase at Tokyo department stores actually carried the rest of Japan’s department stores which experienced a 0.3% decrease overall. The biggest increase came in apparel with 0.3%, which has not experienced an increase in the previous 40 months. Household goods also saw an uptick of 1.7%.

The increase in same-store-sales for October and the first half of November can be attributed to consumers finally buying the fall/winter apparel (in stores since August) as the temperatures finally drop and from a strong showing at the renovated Ginza Mitsukoshi. To be sure this is not a sign of a full economic recovery as personal spending in Japan is still down as can be seen by the continued sales decrease in high-price items at department stores.  But after 31 straight months of bad news this is certainly welcome news for Japan's department stores, the fashion & luxury sector and Japan's economy overall.
Data Japan Department Stores Association

Jeans Mate Having a Tough Time

Jeans Mate reported a 17.8% decline in same-store-sales so far for the year ending in November. This decline is their first decrease to reach double digits since April of this year. Concerned investors punished Jeans Mate by selling their stock causing a 2.7% drop of 5 yen to 178 yen in trading. As their competitors are recovering and in some cases beginning to thrive, Jeans Mate has been slow to adapt their merchandising strategy and as a result has been experiencing a difficult business environment in the past eight months.

Data Jeans Mate Corp.

Marui Online

In an effort to increase sales growth and compete with Amazon Japan and Yahoo Japan, Marui Group Co. this week will announce a strategic Internet partnership with Rakuten Inc.  The partnership will encompass online sales for apparel, house wares and private label goods. 

Online and catalog sales for Marui increased 8.4% to 20.8 billion yen for the year ending March 2010. 

Data Marui Group Co.

H&M Fukuoka

Not to let Abercrombie & Fitch have all the fun…at least for the first day – H&M will open their first flagship in Southern Japan in Fukuoka, Japan in the autumn of 2011. 

Currently H&M has 10 stores in Japan, in cites such as Tokyo, Yokohama and Osaka.

Grand Opening: Diesel Shibuya

On Saturday Diesel opened up their new flagship in Tokyo. The Diesel lifestyle branded-store is located in Shibuya and covers 10,763 sqf over two floors. Not only does this new Diesel store carry denim and coordinates it also carries Diesel’s recently launched home collection and their high-end exclusive Black Gold line. Besides apparel, accessories and home goods the Diesel flagship also houses a café named humbly enough Glorious Café.

To celebrate the opening of the new Shibuya flagship, Diesel hosted a party last Thursday evening with Diesel founder and owner Renzo Russo present and mingling with the crowd. Diesel’s sales in Japan increased 7% in 2009 to over 25 billion yen.

Forever 21 Shibuya

Next month, in time for the prime-retail shopping season Forever 21 will debut their fifth store in Japan. The new Forever 21 flagship will open in Shibuya in the old HMV store location which closed this year. The new store will cover 4,000 sqm and be spread over six floors. Originally set to open in January 2011 the Shibuya Forever 21 store will open one month earlier due to renovations being completed ahead of schedule.

On opening day expect a long queue, fantastic opening-day sale numbers and a great giveaway item.

J-Front Renovates

Not to be out done by Mitsukoshi’s renovation of their Ginza department store, J-Front Retailing, holding company of Daimaru and Matsuzakaya will invest 35 billion yen to renovate and update their Umeda Daimaru and Nagoya Matsuzakaya locations, with most of the investment going to Umeda Daimaru.

What renovations and updates can J-Front really do that will make customers want to return and shop. Shouldn’t they spend their Yen more wisely and invest in the root of why department stores sales have decreased 21 months straight with them included? Otherwise it is just going to be 35 billion yen of the same old previous 31 months.

ABC Mart is Number One!

Already in strong control, or should I say domination of the retail footwear market in Japan, ABC Mart is just about to get even bigger – in fact, number one. With same-store-sales for ABC Mart consistently increasing this year, they recently surpassed Chiyoda, which has been at the top of the ranking for footwear retailers for over twenty years, to be number one. And not only did they pass by Chiyoda, ABC Mart did it with a double digit gain of 12%. Not bad for company that never negotiates and sets its own rules.

What’s next for ABC Mart, a merger and acquisition or would it be a hostile takeover?

Data ABC Mart

Investors are not buying Takashimaya's fast-fashion entry

Following up on my previous post on Takashimaya entering the fast-fashion category – investors were not impressed as they let the share price at Takashimaya Co. fall 7 yen to 670 yen for the day.

The beginning of investor sentiment may soon answer my earlier curiosity if this new strategy of entering the fast-fashion category for Takashimaya will be successful.

Data NQN

Takashimaya to enter the crowded Fast-Fashion category

Coming off of a depressing year of negative 14.6% in sales in 2009, Takashimaya Co. will start to design, produce and sell its own line of clothing. Copying the successful models of Fast Retailing’s Uniqlo and H&M, Takashimaya will look to boost their market positions in this down economy through producing affordable fashion – or as we know it fast-fashion.

Takashimaya is buying fabrics in bulk and outsourcing production in China. They plan on competing directly with some of the very brands they carry by selling similar merchandise at a fraction of the cost. Along with their new fast-fashion strategy Takashimaya plans on expanding into men’s apparel as well as into new markets Hokkaido and Kyushu. Takashimaya is forecasting sales of 1 billion yen in the first year for their new fast-fashion line

I am curious if this strategy will work for Takashimaya and if so will other department stores, which are desperately looking for a new revenue generating strategy, do the same?

Information Takashimaya Co.

Omotesando Project

Over one year ago when I first heard the Harajuku GAP store would close I wondered what would take its place. I heard many different names from Abercrombie & Fitch to H&M to Urban Outfitters and more. Well, I don’t have to wonder anymore (well, just a little really). With the news that architects Nakamura, Hiroshi and NAP would be designing the new building (taking the place of the old GAP store) across from LaForet it was also announced that Tommy Hilfiger would be one of the tenants. Apparently there will be three tenants all together and the other two have yet to be officially announced, though I hear from several sources it will be Hollister (a younger version of Abercrombie & Fitch) and American Eagle Outfitters. When I contacted both US offices of American Eagle Outfitters and A&F for Hollister of course no one could or would confirm they would be opening stores in Japan let alone in Harajuku.

Above is a picture courtesy of Hiroshi Nakamura & NAP of what the new development is rendered to look like.

Abercrombie & Fitch Fukuoka - No real update

Yesterday was the opening of the second Abercrombie & Fitch store in Japan.  The 1,100 sqm store spread out over four floors opened in trendy Tenjin.  No word on first day sale numbers yet, though I am sure they will not match the 50 million yen they did at their Ginza store opening in November 2009. 

Photo http://fukuoka-you.com

Mizuno Up Again in Q2

Coming off a strong Q1 Osaka-based Mizuno Corporation experienced an almost 50% increase in Q2 profits. With strong sales that almost doubled in North America, South America and Europe Mizuno reported 1.78 billion in net income, a 91% increase from 2009. With the western hemisphere proving strong for Mizuno sales were not so good for Australia, Japan and the rest of Asia with revenues down almost 50% from 2009 staying even at 76.2 billion yen.


With sales increasing overall Mizuno has revised their full-year net income forecast to increase by 25% to 2 billion yen with sales decreasing by 3 billion yen – due to currency exchange rate losses.

Information WWD/Michelle Tay

For a short time only Calvin Klein on Cat Street

Starting today until Monday 22 November Calvin Klein will open their first ever multi-brand pop up shop on Omotesando’s Cat Street. The shop is over 1,600 sqf and will include an assortment of CK Collection, CK Jeans, CK Underwear, CK Home and a limited series of CK Gold products.

The opening of the pop-shop is a test to see if the Calvin Klein brand can be reintroduced to the Japanese market and sustain a flagship store and more after closing under the operation of Onward Kashiyama several years ago.

Currently the pop up shop is the only place in Japan where you can buy the full CK Collection. If you are interested act now or in less than two weeks it will all be gone.

Information WWD/Amanda Kaiser

Isetan Mitsukoshi's Net Profit Drops 90%

Isetan Mitsukoshi Holdings reported a 90% plummet in their net profit for the year to 413 million yen in the six months all through September. The losses came on large cost cuts, an appraisal loss of its shareholdings, property sales and demolitions as well as slow fall sales.

Prior to the renovation of Mitsukoshi Ginza sales dropped 6% to 579.9 billion yen, while pretax profits rose 25% to 8.5 billion.

Data Isetan Mitsukoshi Holdings

Avon, a Discontinued Operation

Accounting for less than 2% of total global turnover Avon Japan will be discontinued by the fourth quarter of this year. Avon Products, Inc. plans on selling their 74.67% ownership in its Japanese subsidiary to an affiliate of TPG Capital for 7.3 billion yen.

Not seeing high potential in the Japanese market, Avon is directing their resources elsewhere where they can experience higher-growth potential.

Sales of Avon in Japan are more than half generated by direct mail by products made specifically for the Japan market. With the sale of Avon’s stake in Japan the TPG affiliate will also acquire the Japan specific products and formulas as well as use of the Avon name for a limited time.

Data Avon Products, Inc. & WWD

H20 Retailing Closing Kobe Hankyu in Harborland

Come 2012 there will be one less tenant at Kobe Harborland.  H20 Retailing will close their Hanyku outlet in Kobe, Hyogo due to weak sales and enduring losses.

Since it’s opening inside Kobe Harborland in 1992, the Kobe Hankyu has been a major tourist attraction with six floors of shops, restaurants, hotels and theaters spread across 33,000 sqm.

In 1997 the Kobe Hankyu reported record sales of 25.9 billion yen and since then has consistently sustained sales losses with sales projected to end on the year March 2011 at 8.9 billion yen.

Kobe Hankyu will also join the ranks of Sogo & Seibu, Daiei, and the New Otani who also pulled out of Harborland.

Downtown is no longer just for high-street

Another reason fewer customers are going to department stores – clothing and fast-fashion retailers are opening stores in the center of the cities, in some cases near the department stores. With the economy still struggling to recover, the demand for trendy and inexpensive fashion as well as lower rents are making it easier for clothing and fast-fashion retailers to open stores in urban city centers – thus drawing customers away from their higher profile department store retailers.

This year alone Fast Retailing will open 60 Uniqlo stores in Japan mostly in city centers are close outlying areas. Similarly, Aoyama Trading Company will open 2 men’s clothing stores: one in Shibuya and a newly renovated store in Tenjin, Fukuoka. This does not included the new store Aoyama Trading Company opened in Ginza in October. Not too be left out Point Inc. is also opening stores in urban areas including Shinjuku this Wednesday. Shimamura Co. is also in on the action recently opening a new store in Yokohama.

Store openings in Japan are nothing new but what is new is the size of the stores being opened. Due to the recent rent decreases most of the store openings in the city centers are up to 50% larger than their typical retail outlets.

Retail has just gotten more interesting.

Data Fast Retailing Co., Aoyama Trading Co., Shimamura Co., Point Inc.

Uniqlo in the KL

Yesterday’s opening of the first Uniqlo store in Malaysia drew a line of about 2,500 people, matching that of the Uniqlo opening in Taiwan in October.

The new Uniqlo store located in the Fahrenheit 88 shopping mall in Kuala Lumpur is three floors and covers 2,140 sqm of floor space. Carrying about 500 items the new KL Uniqlo store is comparable to stores in Tokyo.

Malaysia is the second location for a Uniqlo store opening in Southeast Asia after Singapore in 2009.  Fast Retailing plans to open additional Uniqlo stores in more locations in Thailand, Indonesia, Vietnam, the Philippines as well as South Korea and China.

Data Fast Retailing Co.

Can’t get enough of Fast Retailing

Even with same-store-sales decreasing most of this year and profit forecasts being reforecast again…and again Fast Retailing will continue their expansion domestically and overseas. With yet another new flagship set to open in Ginza next year Fast Retailing is also quickening their pace of opening new shops overseas. Starting today Fast Retailing will open their first Uniqlo in Malaysia. The shop which will be 2,140sqm will carry about 500 items and will be the fourth shop in Southeast Asia after the three store openings in Singapore in 2009. Following Malaysia Fast Retailing plans on opening shops in Thailand, the Philippines, Vietnam and Indonesia within the two years.

Fast Retailing’s plan is to increase the number of stores in Southeast Asia as well as Taiwan and South Korea from 53 to 1,000 within ten years equaling the number of stores in China, which are currently 67.

Sounds like a whole lot of stores. Before over-expanding in Southeast Asia and over saturating Ginza, shouldn’t Fast Retailing look to their domestic market where their same-store-sales have been down for over half the year?

Data Fast Retailing Co.

Uniqlo's October Same-Store-Sales Fall

Same-store-sales for Fast Retailing’s Uniqlo fell again for October. The decrease for October’s same-store-sales was 1.1%, not as steep as the 24% drop in September. Along with decreasing same-store-sales for October visitors to Uniqlo stores also dropped 0.2%.

Continued weakness in the Japanese economy along with low consumer confidence and slow winter apparel sales in the beginning of October contributed to the decline in sales at Uniqlo.

Data Fast Retaling Co.

Shiseido’s Profits Fall

With the acquisition of Bare Escentuals driving first-half profit down 58% Shiseido Co. Ltd. slashed its full-year profit forecasts. For the six months ending 30 September 2010.  Shiseido’s net profit decreased 57.6% to 7.54 billion yen with operating profits also decreasing 3.9% to 21.85 billion yen. Global sales in the first-half for Shiseido increased 5.2% to 333.63 billion yen except in Japan where sales decreased 4.3% to 198.9 billion yen, where the recovery is still slow and lagging behind the rest of the world economies. Outside of Japan sales increased 23% to 134.7 billion yen. Shiseido revised full-year profit forecasts to 25 billion yen, a decrease from their previous forecast of 31 billion yen and a 25.8% drop from their 2009 profits. Shiseido also revised their full-year sales forecast from 660 billion yen to 688 billion yen, a 6.7% increase from 2009.

As cosmetics markets like apparel markets recover globally - except for Japan - expect more companies to reforecast profits and sales in the Japan market.

Data Shiseido Co. Ltd.