How Did The Japanese Richest Man, Liu Qi, Founder Of UNIQLO?

In today's fast fashion business, UNIQLO's basic marketing is global and ambitious to become the world's largest apparel retailer.

In white-collar workers in a second tier city, there are at least one or two uniforms in wardrobe.

UNIQLO, which seems to be "insulated" with fashion, has made Japan's richest man Liu Jing and his nearly 400 billion scale clothing retail empire.

In the latest Forbes 2019 list of Japanese riches, UNIQLO founder Liu Jing is once again the top of the list. This is the fifth time that Ryui Masa has reached the top of the rich since 2009, and Sun Zhengyi, the old rival Softbank group, has dropped to second.

With the sale of UNIQLO, as the founder of the fast selling company of UNIQLO parent company, Ryui Masa's property jumped 5 billion 600 million US dollars last year, reaching US $24 billion 900 million (about 167 billion yuan).

In April 11th, the first half of fiscal year 2019 released by XXX group showed that as of February 28, 2019, group sales amounted to 1 trillion and 270 billion yen (76 billion 300 million yuan), an increase of 6.8% over the same period last year, and net profit of 114 billion yen (6 billion 800 million yuan), an increase of 9.5%, all hit a record high.

After the release of the earnings report, XXX group's share price rose 7.89% in April 12th to 59 thousand and 800 yen (3600 yuan), with a market value of about 6 trillion and 350 billion yen (about 380 billion 700 million yuan). At present, Ryui Masa and his family hold 49% of fast selling group.

And Ryui Masa's private dress style is simple, slow speaking and keen to "bring salt" to his own brand, which is said to spend more than 400 yuan on the whole body. He is the leader of the world's third largest clothing retailer. As a clear stream of fashion circles, what is the secret of Liu well's success? What does UNIQLO rely on to seize the minds and pocketbooks of the younger generation?

Inherited his fathers

In 1949, at the time of Ryui Masamitsuzuki, his father, Liu Jing, opened a small shop in Yamaguchi Prefecture, Japan, called "small county business", which was designed for Bank Securities personas to make a senior suit. His father was short tempered and harsh. Liu was very naughty when his child was young. His father always reprimanded him in the face, so Ryui Masa was afraid to see him from childhood.

Ryui Masa entered Waseda University at the age of 18. After graduating from University, he wandered around, and later entered the department store "Jia Shi Ke" as a tally clerk under his father's strong demand. Boring replenishment is boring. Ryui Masa resigned from his post until he got married.

At that time, small county business had 6 million yen, but the whole store was inefficient and on the verge of bankruptcy. At the beginning of the business, Liu well had his own idea, but the shop staff resigned. However, the father did not blame him, but gave him the books. At that moment, Ryui Masa, 25, decided to go all the way to make the company run well.

From the purchase, display of goods, inventory to reception, accounts, cleaning, hands-on, and the rest of a shop assistant to manage the store business, all day long busy, Ryui Masashiya gradually has his own experience. Tailoring the customer and selling the goods eventually gave him a sense of achievement.

Subsequently, he was keen to capture the potential of casual wear market, so he opened several American leisure wear stores, but casual wear prices were not cheap at that time.

During this period, he went to the us to study and was impressed by the self-service casual wear supermarket, and later became the business purpose of "help yourself" in UNIQLO. In order to enable young people to buy good quality and inexpensive products, Ryui Masa's ideal clothing store model gradually became clear, "a huge warehouse to pick clothes at any time". This is also the origin of the name of "Unique Clothing Ware House", or "UNICLO".

In June 2, 1984, the first UNIQLO library was born in Hiroshima, Japan. 4 years later, the company set up a joint venture in Hongkong. The clerk wrote the letter C to Q by mistake. Instead, Ryui Masa felt that the visual effect of "UNIQLO" was better.

Japan was in the economic recession, and UNIQLO's clothing prices were priced at 1000 yen to 1900 yen, which was welcomed by consumers. Because sales promotion is in place, the first day of opening a shop is crowded, and the goods are sold out quickly, and even the passenger flow has to be restricted. In second years, two stores were opened.

The secular notion that cheap goods are not good, Ryui Masa is going to break down and decide to produce "good quality and low price" clothes. For this reason, the company needs to monitor the whole industry chain of commodity planning, production, logistics, distribution and sales, and strictly implement the quality standard of "craftsman" project.

In February 1, 1999, the parent company of UNIQLO was listed on the main board of the Tokyo stock exchange. Liu well was telling the father the fifth day of the good news, and his father died. On that day, it was Ryui Masa's 50 birthday, but he always said goodbye to his 79 year old father. At the funeral, Ryui Masa cried for the first time in public. He said, "father is the biggest competitor in my life."

One win, nine defeats.

It took Ryui Masa more than 30 years to take over the family business and become the richest person in Japan. During this period, UNIQLO began to rise and fall, experienced many waves of great storms, and completed metamorphosis. Behind the scenes, more failed attempts were actually attributed to "one win, nine defeats".

UNIQLO took a detour from the earliest selling mode to hiring professional designers.

After the start of the hot business, less than 3 years after its opening, sales of UNIQLO began to decline sharply, and capital turnover was also in a predicament. At that time, the expansion speed of the company was too fast. On the one hand, it became more and more difficult for the best seller to supply goods, and the other side was the backlog of the unsalable goods, so UNIQLO began to consider opening factories overseas.

Because UNIQLO has no independent designer, the garments commissioned by the factory are not satisfactory, sometimes they can only sell at reduced prices. In 1987, Ryui Masa decided to hire professional designers to produce "original" clothes. To this end, he made a special trip to Paris, France, and invited the Prada designer Jil Sander, who had been hiding for many years, to make mountains. Since then, UNIQLO has set up R & D centers in Tokyo, New York, Paris and Milan respectively, keeping up with the next season's popular elements and developing new products.

In 1991, Ryui Masa changed the name of the company to "quick sale", which means rapid sales, and opened a chain operation mode to expand the stores on a large scale. In September of the same year, he set a new target of "opening 30 stores a year, 3 shops and 100 stores a year". He has always told employees that people should have lofty goals, can not pursue comfort, and should be cruel and set their goals as high as possible.

In July 14, 1994, fast selling landed on the Hiroshima stock exchange and doubled on the second day. Overnight, 13 billion 400 million yen arrived, UNIQLO began to expand its stores without delay, and landed on the second board of the Tokyo stock exchange 3 years later. In November 1997, there were more than 300 outlets.

Along with the capital movement that has surged forward, there has been a series of failures. The first is New York. In 1994, UNIQLO established a wholly-owned subsidiary in New York, planning to collect fashion information in the United States, design it in Japan, and then commissioned factory processing. In the autumn of 1995, new products of UNIQLO were listed in New York. The best-selling monochromatic basic money in East Asia has been completely destroyed in North America. Since then, due to poor information exchange between America and Japan, New York's subsidiary has been dissolved after 3 years of hard work.

Next, UNIQLO paid a lot of tuition fees in its acquisition and diversification. In 1996, the company bought the VM85% stake in Tokyo children's wear company, but soon encountered its parent company's trademark infringement accusation. After 8 months of acquisition, legal action plus a continuous loss, VM had to enter bankruptcy liquidation.

In 1997, UNIQLO tried to launch sports and family money brands, but because it was not obvious from the location of UNIQLO, it occupied the living space of the original brand of UNIQLO. Although Ryui Masa opened more than 30 stores, he made a quick decision.

In March 2003, when UNIQLO expanded its stores to 21 stores in the UK, it had been losing money and finally announced 16 stores.

Ryui Masa said, "failure is certainly a wound, but it also contains the next hope of success."

The key is whether it is wise to make timely decisions and decide whether to stop in time.

Explosive Philosophy

UNIQLO's success was due to the discovery of customers' demand for basic funds, and therefore the way to survive in the ever-changing fashion.

Cheap and easy to use, the foundation is not outdated, so that UNIQLO is extremely cost-effective, breaking the age, identity circle. In the basic section, the design elements are added, and the color of the single product is rich and the selection is very large. For example, the designer's cooperation and UT (printed T-shirt) which are in line with popular culture are welcomed by consumers. In addition, UNIQLO has been developing new technologies and fabrics. After 2000, Bra-T (bra strap) and Heattech (light and hot underwear) continue to follow the road of explosive products.

In Ryui Masa's view, the clothing of UNIQLO brand is for all kinds of consumers, whether they are billionaires, middle class or low price customers. In the fast changing fashion retail market, the actual operation must be carried out by the young people, to see the joy of the young people, and at the same time, have rich digital experience to make a quick judgement according to the market changes.

Ryui Masa said that UNIQLO's main task is to strive for the ultimate goal of low price and high quality products. This is very difficult, but "many times," narrow door "is a shortcut to success.

One of the most typical examples is the fleece products. By independently developing and improving production, UNIQLO realized mass production of fleece, and at the same time made great breakthroughs in color richness. It has popularized the high end fleece sweater originally priced at around 10 thousand yen, which is limited in color and used in ski suit to the life of the masses.

The fleece sweater has become the blasting point of UNIQLO's success.

In November 1998, UNIQLO Tokyo Harajuku store opened. "UNIQLO's fleece sweater, 1900 yen" advertisement spreads all over the streets, stations and subway cars. This price is equivalent to 1/10 of Japanese working-class's daily salary. On the day of its opening, it was also a hot scene for customers to queue up and rush to buy. This year, UNIQLO's sales exceeded 100 billion yen for the first time, and its pre tax profit amounted to 14 billion 100 million yen.

In the autumn and winter of 2000, UNIQLO launched 51 kinds of colored sweaters, which originally sold 12 million pieces, and finally sold 26 million products, which became the most popular single product of UNIQLO.

However, the good times are not long. In August 2001, the new product development of UNIQLO was weak, and sales went down again.

This is because in the boom sales boom, the company went on a comfortable life and began to think hard. Ryui Masa warned employees: when an enterprise is stagnant, every employee should seriously think about how to promote the progress of the enterprise, rather than lie on the merit book.

In June 1998, he put forward the "ABC" plan, namely ALL (all), BETTER (better), CHANGE (change). This change quickly showed results. In August 1999, UNIQLO's annual sales exceeded 100 billion yen, and its stores increased to 368.

The main points of ABC reform are as follows:

1, innovation of fast selling system: quickly lock in the best sellers and develop production with the fastest speed. Control the quantity of goods in 200 kinds, and increase the different colors and sizes of the same commodity to meet the needs of different consumers.

2, marketing and commodity development plan to get through.

3, the transformation from headquarter leading to self operation of stores is no longer a simple replication of the will of the headquarters, the establishment of a super star shop manager system and a set of performance related pay systems. Therefore, the center of business activities is the store, and the store manager is the protagonist of the company.

The starting point of this reform is to transform the shop into a customer's intimate place from the customer's perspective. Ryui Masa pointed out in particular that the organization was created to attack, and the original mode was just for defense. As companies grow larger and larger, organizations can no longer operate flexibly and their efficiency will drop.

"No reform will die." He said.

Hold on to China's rocking Qian Shu

In recent years, China has become a growth engine for fast selling overseas businesses, but the growth rate of the Japanese market has slowed down significantly.

In the first half of fiscal year 2019, the sales volume of UNIQLO's Greater China accounted for 22.3%, contributing nearly 1/4. During the reporting period, with the strong performance of the Chinese mainland market, overseas UNIQLO revenue reached 580 billion yen, an increase of 14.3% over the same period last year, operating profit of 88 billion 400 million yen, an increase of 9.6% over the same period last year. This is in sharp contrast to the slowdown in sales and profit growth in Japan. In addition, UNIQLO's sales in Southeast Asia and Oceania increased, and the US market also made a profit.

In 2018, UNIQLO opened more than 100 stores in the world, only 94 in China, returning to the United States, the United Kingdom, and even to the headquarters of ZARA and H&M. In addition to UNIQLO as the world's main brand, it also introduced 7 sub brands such as GU and Theory, but the growth rate of these new brands is uneven.

Ryui Seiso said that with the opening speed of 80 to 100 stores a year, it is estimated that the Greater China region will reach 1000 stores in 2020 and 3000 in the future. He said, "China's clothing market has a demand of 50 trillion yen (3 trillion yuan), and will definitely not slow down." However, in order to reduce its dependence on the Chinese market, Xun will take India as the "third arrow" after Japan and China.

The rise of UNIQLO is inextricably linked to Ryui Masa's opportunity to seize the Chinese market.

In 1978, China's mainland reform and opening up, Liu well was producing clothes in mainland factories, and transferred technology and production lines, employing Japanese retired skilled masters to supervise. This makes it possible for UNIQLO to provide cheap and high-quality clothes.

UNIQLO entered China in 2001. In order not to repeat the mistakes of London's opening up shop, it decided to step by step and take the "single store profit" as its goal. To this end, at the end of 2005, UNIQLO closed 2 stores in 9 places, such as Beijing, Shanghai and Hangzhou, and concentrated on developing Shanghai stores. Finally, it was able to gain a firm foothold in the Chinese market.

In 2013, UNIQLO's largest flagship store was located in Shanghai. This year, ambitious Ryui Masa also announced a bigger goal: the world's first in 2020 and sales of 5 trillion yen. To achieve this goal, he even gave up his plan to retire in 2014.

However, the net profit plunged by 56% in 2015. Ryui Masa, 68, admitted that the "2020 plan" failed.

After the defeat, UNIQLO adjusted the marketing strategy in a timely manner. In 2017, the cold weather, HEATTECH, light down, fleece, sportswear, warm pants and other cold clothing sales growth, UNIQLO performance has been revival.

Ma once said that Starbucks and UNIQLO are their most admired companies. "There are many clothes selling all over the world, but only he sold UNIQLO and became the richest man in Japan."

Today, the fast selling group of UNIQLO has 3445 stores in the world, with more than 660 mainland China alone, with an annual income of 2 trillion and 130 billion yen, selling more than 1 billion pieces of clothing every year, which is equivalent to 1 customers per 7 people worldwide.

Undoubtedly, it is unknowable high risk that the aggressive measures that go hand in hand with overseas expansion and diversification.

When UNIQLO is in the ascendant, Ryui Masa is 70 years old and is about to enter the countdown of his career. He has said that he will remain chairman of the board after leaving office for CEO. The new CEO will not be recruited from outside, but from more than 40 executive directors.

Ryui Masa's two son is a senior vice president of the company, but Ryui Masa has earlier denied that he would pass the company on to his son. He said: "I do not want to leave property to future generations, nor do I want to find professional managers to take over the group. I want to find some people who really have UNIQLO DNA and have a deep understanding of UNIQLO values.

Ryui Masa is about to let go. Can this big ship continue to go far?