Uniqlo Case

INTRODUCTION:

In 1984, Ogori Shoji Co., Ltd. opened the first “Unique Clothing Warehouse”, (a.k.a. Uniqlo), store in Hiroshima, Japan, marketing casual apparel to both women and men. Later, in 1991, Ogori Shoji Co., Ltd. was renamed to Fast Retailing Co., Ltd, which is the current parent company of Uniqlo, and it began rapidly expanding operations domestically, leading to more than 100 stores throughout Japan by 1994. It was in 1997 that they began strategizing to become a Specialty-store/retailer of Private-label Apparel (SPA), much like the US-based company, The Gap. This meant that they would have to add designing and manufacturing to their existing business investments and begin focusing their attention on the larger and more sophisticated urban markets. They sought domestic growth at first, opening a store in a trendy part of Tokyo in 1998, followed by many other stores throughout Japan, seeking acceptance from the urban market. One year after launching their online business, London became the home of Uniqlo’s first international store in 2001. They have been expanding into other international markets ever since and currently own and operate 824 stores in Japan and 150 stores in other markets around the globe in Asia, Europe and the United States.1

Over the past decade, Uniqlo has sought international growth through Greenfield attempts and mergers and acquisitions, some of which have failed and some which have proved successful.

In a Wall Street Journal (WSJ) article from February 12, 2010, the Chief Executive Officer (CEO) of Fast Retailing, Tadashi Yanai, expressed deep interest in expanding the global footprint of Uniqlo. While a Greenfield strategy has worked well in the Asian markets like mainland China, Hong Kong, South Korea, Singapore, Taiwan, Malaysia and Russia, mainly because they are underdeveloped, the company feels that it will have to focus on foreign acquisitions in order