Annual Report

5472 words - 22 pages

The UNIQLO Business

Fashionable and high-quality clothes that anyone can wear anywhere, any time—that’s what UNIQLO is all about.
Our global operating systems weave together all processes from product design to final sales, including global
R&D, procurement of world-class quality materials, production focused in China, and the operation of 750 stores
around the globe. This seamless system allows UNIQLO to consistently offer its customers high-quality products at
reasonable prices.

b FAST RETAILING CO., LTD.
b UNIQLO(U.K.)LTD.
b FAST RETAILING (JIANGSU) APPAREL
CO., LTD.
b UNIQLO USA, Inc.
b FRL Korea Co., Ltd.
b UNIQLO HONG KONG, LIMITED

b G.U. CO., LTD.

b CABIN CO., ...view middle of the document...

Although domestic demand, mainly for heavier apparel,
expanded during the autumn/winter season of 2005, owing
to the positive impact of colder weather, climate conditions
were less favorable during the spring/summer season of
2006, thus leading to slower apparel expenditures. On the
other hand, examination of the performance of apparel specialty stores nationwide shows that many companies ranking
high in terms of sales have been able to improve their performance. As these companies have aggressively expanded
their store networks, the intensely competitive “survival of the
fittest” conditions continue to prevail.
Overseas, while the markets in industrialized areas—such
as the United States, Europe, and Japan—are still large,
rates of growth in the United States and the Asia-Pacific
region are rising.
Store Location/Format and Product Development
UNIQLO opened its first store in 1984. Thereafter, it has
established its SPA model, which integrates product design,
production, distribution, and sales. By offering high-quality
casual wear at unbeatably attractive prices through standardized roadside stores, UNIQLO attained significant growth in
the 1990s. Especially from 1998 onward, UNIQLO posted
substantial gains, partly because of the boom in fleece products. However, the reaction to this boom thereafter led to
declines in net sales and income for the years ended August
14

FAST RETAILING ANNUAL REPORT 2006

31, 2002 and 2003, but sales and income staged a comeback beginning in the year ended August 2004. Since then,
sales have increased along with UNIQLO’s aggressive
“scrap-and-build” strategy aimed at extending its store network.
Today, with more than 730 stores in Japan and increasingly more intense competition, further growth requires UNIQLO
to identify and meet new customer needs by opening stores
in other types of locations and formats than its standardized
suburban stores and offer an even more attractive lineup of
products in addition to basic items.
Regarding store locations and formats, along with standardized suburban roadside stores, UNIQLO is opening
stores in diverse locations and formats to match customer
requirements. The Ginza store in Tokyo, inaugurated in
October 2005, has attained a high level of profit margins,
although it is on an urban roadside, thus demonstrating that
there are more possibilities for UNIQLO stores in new types
of locations and formats. Going forward, UNIQLO has positioned larger stores as its growth driver and plans to accelerate the opening of such stores.
In product development, in autumn 2005, UNIQLO introduced its global R&D with offices in Tokyo, New York, Paris,
and Milan. These offices gather information on product
trends and market needs, design products, and take new
products to the commercialization stage by coordinating
UNIQLO’s international supply chain. These activities enable
UNIQLO to offer highly fashion-conscious products up to
global...

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