Uniqlo -- the Gap of Japan -- looks at global expansion
Published: Wednesday, August 1, 2007 at 8:34 p.m.
Last Modified: Wednesday, August 1, 2007 at 12:00 a.m.
TOKYO - If you haven't yet heard of Uniqlo, chances are you will soon.
Often called the Gap of Japan, the wildly popular casual apparel chain is turning its ambitions overseas - and upmarket. On Tuesday, Uniqlo's parent company, Fast Retailing, made a $900 million takeover bid for luxury chain Barneys New York.
Back home, the down-to-earth Uniqlo brand has soared to success partly because of Japan's decadelong economic downturn that ended in early 1990s. By focusing on good-quality basics at ultra-low prices, Uniqlo weathered the slump while introducing Japan's notoriously finicky shoppers to the world of bargains.
Now, Fast Retailing wants to woo overseas converts by going head-to-head with mainstays like the Gap Inc. and Limited Brands.
It is opening Uniqlo outlets across Asia and Europe and just christened a mammoth flagship store in Manhattan's trendy SoHo district. Japan has long been famed for its auto and electronics exports, but this is a rare case of a Japanese retailer making it big abroad.
Analysts say Fast Retailing Co. and Uniqlo need to expand overseas to keep profits climbing because the domestic market is saturated. The question is whether it will have any better luck penetrating markets in American or Europe where homegrown brands already dominate. The bid for Barneys is billed as both branching into new geographic territory and balancing the company's offerings with high-margin luxury apparel.
Uniqlo's minimalist stores brim with paired-down must-haves - like denim pants, polo shirts, cotton socks and casual blazers - stocked in a rainbow of different colors. Despite the chain's name, a melding of "unique clothes,'' its lineup is utilitarian, above all.
Then there are the prices: Polo shirts for $16.00, four-pair sets of cotton dress socks for $8.35, jeans at $33.67, wool sweaters for $16.80. And that's before the clearance sales.
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