The Fast Retailing Group generated rises in both revenue and profit in the first nine months of fiscal 2018 from 1 September 2017 to 31 May 2018.
Consolidated revenue totaled ¥1.7041 trillion Japanese yen (US$15.66 billion), up by 15.3% year-on-year and operating profit reached ¥238.8 billion, increased by 32.3% year-on-year. The profit attributable to owners of the parent increased to ¥148.3 billion, an increase of 23.5% year-on-year.
Within the UNIQLO International segment, revenues from Greater China (Mainland China, Hong Kong, and Taiwan) overtook the total income of the other overseas market. It also exceeded its domestic income.
China has become the second largest market for Uniqlo only after Japan for two years running. Uniqlo derived 70% of its overseas revenues from China.
Apart from strong supply chain management, fast product innovation, precision marketing is also the main factor for Uniqlo’s fast-growth in China.
During the March-to-May quarter, same-store sales at UNIQLO Greater China attained double-digit year-on-year growth following a strong launch of new Spring Summer ranges, and effective news generated by popular new UT brand contents, Kando pants, jackets, and other ranges.
Generally, Uniqlo tends to cooperate with the designer and international IP to promote its products. For example, Uniqlo cooperated with Manwei Company to launch a new superhero UT brand, which attracted a lot of consumers to the store.
To keep up with the current new retail trend in China, Uniqlo makes some adjustments to outlet experience and stock.
For example, Uniqlo makes it convenient for consumers to order online and in-store pick-up in any outlet. Uniqlo uses RFID electronic tags to enhance stock management. Moreover, given the large market order and uneven area distribution, Uniqlo adopts a weekly calculation scheme to check the stock.
Such changes promote sales. Uniqlo reported that sales directly promoted by in-store pickup service in Double 11 period this year is five times more than that of last year.
In the future, Uniqlo aims to overtake Zara and H&M to be the world’s largest clothing retailer. Tadashi Yanai, the president and CEO of Uniqlo’s parent Fast Retailing Group, has set a new target for the Greater China. It plans to expand stores to 1,000 by the end of 2021 and achieve a ¥62.5 billion turnover and a ¥12.5 billion operating profit. That means Uniqlo will open 100 new stores in China annually.