A Brief Account Of The Double Factor Of The European Market Of UNIQLO From Profit To Loss

According to the world clothing and shoe net, Asia is the largest after the European market expansion.

Retailer Fast Retailing Co.Ltd. (9983.T) (6288.HK) fast marketing group flagship

Uniqlo

But it ushered in the bad news of the market from profit to loss.

As of August 31, 2016, the European market of Uniqlo UNIQLO recorded a pre Euro loss of 1 million 860 thousand euros. In fiscal year 2015, it recorded a pre Euro profit of 2 million 500 thousand euros, with a loss of 1 million 20 thousand euros, which was significantly lower than the 3 million 70 thousand 3 million 70 thousand operating profit in the 2015 fiscal year.

For profit and loss, Uniqlo UNIQLO blamed its investment and the weakening of the euro against the US dollar, and said its adjusted operating profit was 4 million 300 thousand euros, which has actually increased.

Affected by the strong yen, erroneous price rises and exchange losses, net profit fell to 56.3% in the 2016 fiscal year ended in August 31, 2016, down from 110 billion 27 million yen in the same period last year to 48 billion 52 million yen.

According to data, as of the 2016 fiscal year ended August 31, 2016, Uniqlo UNIQLO's international market profit fell by 113.7% to 37 billion 438 million yen, which recorded an increase of 8.6% to 655 billion 406 million yen.

The data from Uniqlo UNIQLO submitted to the UK company authority showed that the brand's European market revenue in fiscal year 2016 increased to 26% euros to 347 million euros.

Last month, Uniqlo UNIQLO launched a new round of overseas expansion plans after the failure of its 2020 expansion plan in the US market, hoping that the number of stores in the European market could double to 100 by 2020.

At present, Uniqlo UNIQLO has entered the five largest market in Europe, and will enter sixth and seventh European markets this fall - the Spanish and Italy markets.

Due to Japan's economic downturn, Uniqlo UNIQLO's domestic market in the past two years has seen a sluggish performance and even shrinking stores. The real growth of the group has always depended on the international market dominated by Chinese market in the past few years. For this reason, Tadashi Yanai Liu Wei Cheng, a fast marketing CEO, also admitted that the growth of the company depended on the performance of the international market.

According to statistics, as of the first half of fiscal year 2017, the sales of Uniqlo UNIQLO Japan increased by 0.3%, from 453 billion 600 million yen in fiscal year 2016 to 455 billion 100 million yen, and overseas Uniqlo UNIQLO business increased 0.9% to 392 billion 800 million yen in the first half of fiscal year 2017, and 389 billion 200 million yen in the 2016 fiscal year of February 28, 2017.

Uniqlo UNIQLO grew 0.1% in the same store during the Japanese market, while the company said the increase in overseas markets was mainly due to the appreciation of the yen, resulting in an average decline of 11% after conversion to yen.

Early in addition to the Chinese market, Uniqlo UNIQLO has been expanding the US market as a priority, and has released 200 stores and 10 billion US dollars in 2020. However, this goal has gone bankrupt with the group's overall sales target of 5 trillion yen in 2020, and the sales target has been slashed to 3 trillion yen, while the US market has not released a new adjustment target.

10 years after entering the US market for the two time, Uniqlo UNIQLO's US business is still in a state of loss. The fast sales loss has narrowed in the 2017 fiscal year. However, the company and its brand have refused to disclose the specific operation of the US market. As of April 30th, the number of Uniqlo UNIQLO stores in the United States was 47.

As the Uniqlo UNIQLO price rises met with consumers' abandonment, profit fell sharply by 56.3% in the 2016 fiscal year, falling from 110 billion 27 million yen to 48 billion 52 million yen in the 2015 fiscal year.

Uniqlo UNIQLO's European business started in Britain in 2001, but it also suffered setbacks. In Ryui Masa's autobiography, Japan's richest man once said that because of the abuse of local executives, the British market expansion plan failed and eventually had to stop shop.

At present, Uniqlo uniqo has 10 stores in the UK, 19 in France, 19 in Russia, 5 in Germany and 2 in Belgium, with a total of 55.

Although the European market is the stronghold of Uniqlo's strong rival Zara and H&M, Fast Retailing said the demand for basic clothing remains strong. More and more consumers choose to shop online enough to support the brand's bold expansion in the European market.

Given the expansion of double stores and the current state of breakeven, Uniqlo UNIQLO's European expansion plan is clearly more realistic than the US expansion plan, which may be the lesson of Uniqlo UNIQLO and its founder, Liu well, after failing.

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