9 hours ago | By Sandra Halliday
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Japan’s Fast Retailing Co is to put a brake on the runaway success that is Uniqlo, in the US at least.
After revealing a weaker outlook despite record year-end results, the group said late Thursday it would open fewer US stores for its core Uniqlo brand this year after a rapid expansion failed to entice customers.
“The brand… still doesn’t have a lot of recognition in the United States,” admitted CFO Takeshi Okazaki Thursday.
Fast Retailing said it would only open five Uniqlo stores in the US in the fiscal year that began on September 1, after opening just over three times as many stores last year.
Impairment losses worth ¥16.1bn ($135m), related to some of its US Uniqlo stores, as well as its more upscale J Brand denim label and other brands, contributed to the company missing its own forecast for a ¥200bn operating profit for 2014/15.
“The [US losses] were partly due to the rapid expansion with 17 new stores opening in the year,” Okazaki said.
Fast Retailing had set an ambitious goal of opening 100 Uniqlo stores in the US over the next few years.
As of the fiscal year that just ended, it had a total of 42 stores there, but the brand has struggled to compete in a crowded market place.
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