UNIQLO Is Dying For The Best Decision.

In September 1, 1991, in my office on the 4 floor of my small pencil building, I shouted to the staff of the company headquarters gathered here: "from today on, the name of the company is changed from" small county business "to" FAST RETAILING (fast Marketing) ". UNIQLO officially expands the national lock industry, opening 30 stores a year, reaching 100 in three years, and achieving the target of listing as soon as possible.

Once this goal fails, the company may fail, but that is the best opportunity for expansion.

Expansion impulse

The process of listing is trivial and anxious, but we are surprised and dangerous.

After the listing on the Hiroshima stock exchange in December 1994, our impulse to expand appears more urgent and more confident.

First, in order to strengthen

The mode of production chain we want to build is to collect fashion information and plan products in New York, and design the new products by Osaka commodity design office and the company headquarters of Yamaguchi, and then entrust overseas manufacturers such as China for processing and production.

But in the early autumn of 1995, the products made by the New York subsidiary were put into the market on the whole, but they suffered the tragedy of annihilated troops.

Because the market does not accept colors that are not bright enough.

Later, the reason was analyzed because there was no good communication between the New York, Osaka and the Hon HQ headquarters.

So in November 1996, a commodity design office was set up in Tokyo.

In this way, the work of commodity planning has been spread to four parts: New York, Tokyo, Osaka and mountain pass.

But in practical operation, it is more difficult to exchange and share information smoothly in four places.

I realize that this kind of organizational structure is not feasible. We must establish an integrated mechanism for R & D in Tokyo.

Thus, the New York subsidiary, founded 3 and a half years ago, announced its dissolution.

Then, in October 1996, we bought a 85% stake in a children's clothing company (VM) in Tokyo and received it under "uniqo".

The company's children's goods are very competitive, separated from a company called VJ, and the operators are from the same company.

But when VM got the sole trademark, the relationship with VJ became subtlety.

In particular, when VM announced the announcement of the coming of other new brands, VJ filed a lawsuit against VM company on a page of paper, accusing it of violating the terms of use of trademarks in the law against unfair competition.

We can only do it by ourselves.

Because at that time, we thought that "there is no problem in law".

In addition, the profit and loss structure of VM company has not been improved very well, and there has been a continuous loss.

In the end, 8 months after the purchase, we shut down all the shops of VM company and implemented liquidation except for the property rights companies that only left trademark management.

From this failure, we realize that UNIQLO's own products are brand names of others (we pay for them).

In addition, I sprouted the idea of opening a store for sportswear and sportswear.

Because UNIQLO is doing casual wear, which is similar to sportswear, but even UNIQLO imported clothing or borrowed from international brands.

After a year or so of preparation, in October 1997, "SPOQLO" and "FAMIQLO" launched nine stores.

But when "SPOQLO" was opened to 17, and "FAMIQLO" opened to 18, we had to close the shop.

The reason for this failure is that, on the one hand, there is no obvious distinction between the goods sold in the shops of this kind of format and the original UNIQLO goods; on the other hand, in order to give priority to ensuring the type and quantity of these stores, sometimes they have to mobilize the goods of UNIQLO, which makes the stores of UNIQLO appear out of stock and break codes.

From the standpoint of the customer, it can be bought in a UNIQLO shop, and now it will be inconvenient to run three.

In this way, new business attempts failed.

Of course, you don't know what's going on if you don't do many things.

Conservative obsession

The real success of UNIQLO started with the sale of thin sweaters.

In 1998, we introduced the thin sweater, which made the former people as a mountaineering garment or a special costume of interest and hobby, using the price that anyone could buy, making it a popular commodity, and a rapid upsurge.

But in the three year continuous sale of thin sweaters, the sale of other products also benefited from the multiplying effect, so some of them had the wrong idea that business is very simple, so long as goods can be replenishment in time, they can sell without crying out, as if the store became a vending machine.

Some people attach more importance to form than to content, and think that as long as sales are good, a handsome person will cover up a hundred ugly.

As a result, people who are keen on empty talk have emerged, and some people who have come from big enterprises should have begun to work with everything from the beginning to the beginning, but they have brought some inertia practices of the original big enterprises and do not think of new challenges.

The company should have been in a period of great change, but found some conservative ideas rising.

Success means a conservative start.

People began to want to remain the same.

Therefore, success is also a breeding ground for fossilization, conservatism, formalization and procrastination.

This is very detrimental to further success in business.

Business is the constant challenge and try of "how to do something effective".

In this sense, success sometimes becomes a hindrance to a further step.

In terms of production, supply is always needed because it is in short supply. In sales, even if shops become vending machines, they no longer need brains to sell well.

Under such circumstances, as a business operator, we must ponder. All this is just due to the popularity of the thin sweater, and can not be intoxicated. We must correct the course of the ship as soon as possible.

Whether sales rise or fall, we must keep a cool head and analyze the market objectively.

Be careful in making judgments and decisions, and not be dazzled by success.

Of course, our analysis and Introspection of the situation can not be deviated from the direction. The decisions and actions resulting from the analysis of the actual situation will only tear up the wounds.

Anyway, when a good dinner comes to an end, it ends up.

The upsurge of thin sweater finally ended and entered the first round of stagnation.

Sales of stores also began to decline sharply, with a negative year-on-year growth.

It is not so much that people began to appreciate the fatigue of thin sweaters, but rather the development of new products did not keep pace with them. It can be said that the success of the thin sweater brought "illusion" and led to the next round of new developments.

Once the organization becomes large, it is easy to breed healthy ideas.

And since I am a small business, I have always wanted to seek innovation and change in an unstable environment.

In order to break this situation, new vectors must be set up to challenge new targets.

The new vector is to open stores in London and China.

International Hom

If the listing of the East card is compared to the national team's winning, then the success of the thin sweater is to win the national team. The next stage should be to enter the Olympic Games, that is to say, UNIQLO should expand to the international market.

My goal is to go abroad when the sales volume reaches 300 billion yen, and the time spent on reaching the target seems much earlier than expected. I think, "in that case, let's do it now". So we soon set up a subsidiary in London, England.

Today, when I reflect on this period of time, I feel myself in a crazy bubble.

Because of the success in China, it is easy to think that we can go abroad to develop. We think it is wrong to take Japan's success overseas.

There is "form" without "God", which means there is no soul.

Moreover, the past shape is not the "100%" shape. There is no doubt that the opening of stores in London is not smooth.

It was officially opened in London in September of 2001, that is, it took nearly a year after the establishment of the legal person.

It opened 4 stores in London, and then expanded to 21 stores in the UK, but it has been losing money.

Originally, I always thought that overseas legal entities would be difficult to carry out if they did not use the local people.

So the acquaintance introduced a locals, who came from the old department store in England, Martha, which was said to be excellent.

I thought it was okay after the interview, so he set him up as a business team.

And this is the beginning of failure.

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From our point of view, the team he formed is very conservative. Now it is actually a British culture.

That is, the stratum of the management team, the stratum of the middle management, the class of the shopkeeper and the class of the shop assistants.

Invisible walls between them have been built.

As a result, the Minister of this department established their own small world within their jurisdiction and guarded the small world.

This is a far cry from UNIQLO culture, which has been twisted together with equal status.

And when I realized this trend, the shops in London were already very ill and the reform was imperative.

However, there are other reasons for the failure of the British legal person.

My instructions for the British subsidiary are "50 shops in three years" and "three years of turning losses into profits".

This requirement is in itself problematic and the responsibility lies with me.

Because we need to open 50 stores at the end of 2004, as a result, we set up shop in order to open up shop, completely ignoring the others and going directly to the number of shops, and blindly expanding.

From the point of view of real estate investment, there is no "efficiency" and "effect" judgment in terms of high rent, plus personnel costs that need to be put into the shop, installation works, information systems, training and training, etc., anyway, the practice of opening 50 shops after all, has led to the destruction of the whole army.

From the point of view of doing business, we must first consider when the investment undertaking can be rewarded.

Even if 50 stores are opened, the first thing is to make a shop profitable.

Then let this profit mechanism gradually expand to other stores.

And our illusion is that as long as we open 50 stores, we will naturally start to make profits.

Realize that failure should be corrected quickly.

For this reason, we began to compress the scale, and all the stores outside the London circle were completely closed.

In the city of London, or out of town, far away from the suburbs, all the bad ones are closed.

As a result, all 5 stores except the city center and the suburbs can be turned off.

Of course, the study of London market is not in place, and it is also one of the important reasons for failure.

After such a big failure, UNIQLO's opening shop in Shanghai can't be as aggressive as in London, but it will take one step at a time, open a shop and make a profit.

With lofty aspirations, realistic problems, solid foundation and scale expansion, these are valuable lessons drawn from the failure of London.

In the eyes of the general public, I seem to be a success, but I do not think so.

As I said before, I went through the life of "nine defeats and one win". UNIQLO did a lot of business, but we learned from experience and lessons from so many failures.

Therefore, starting a business does not require any special qualification, but comes out step by step from failure.

The key question is whether you can get away in time when you have made the judgement of "failure".

Now that we know that this attempt will bring losses, it is the best decision to stop this loss in time.

The valuable experience I learned from these failures is that it is more important than any time to stop losses and seek quick recovery.