Overview of the Retail Apparel Market

Retail apparel market

The scale of the Japanese retail apparel market is around ¥9–10 trillion per year. The market entered a period of contraction in the immediate aftermath of the collapse of Lehman Brothers in 2008, bottoming out in 2010. Thereafter, the market enjoyed four consecutive years of growth. In 2014, business conditions changed as a result of the hike in Japan’s consumption tax rate. Buoyed more recently by such factors as lively consumption on the back of overseas visitors traveling to Japan, activity in the retail apparel market saw a slight upswing compared with the previous year.

Trends in the scale of Japan’s retail apparel market and UNITED ARROWS Group sales

Trends in the scale of Japan’s retail apparel market and UNITED ARROWS Group sales

Sales channel

The market scale of other areas within the retail sector, including specialty and other stores,*1 also continues to grow. In recent years, major apparel retailers as well as select shops have ramped up their online sales activities and strengthened their omni channel retailing strategies. These initiatives have triggered an upswing mainly in online sales. The sale of basic casual clothing by specialty stores and the activities of select shops have been robust with sales also maintaining their year-on-year upward path in 2014.

*1 The others channel includes mail order / online (Internet, catalog, television, others) as well as discount stores.

Trends in sales composition ratio by sales channel

Trends in rates of sales growth by sales channel

Select shops

Select shops are stores that provide customers with products based on unique brand concepts and the discerning judgment of their buyers. There are also a significant number of companies that adopt an SPA*2 (specialty store retailer of private label apparel) strategy under which they offer a mix of purchased and private label products. In handling products that offer the appeal of high-value-added attributes and a distinctive uniqueness, select shops are positioned between department and specialty stores at the mid-to-high-end price range. UNITED ARROWS LTD. maintains a balance between attracting customers by carefully handpicking selected designer brands from Japan and overseas and ensuring high profitability by offering private label brands. The Company has the largest sales of any company adopting a select shop business model and is the only such company to have publicly listed its stock.

*2 ‌SPA: A fashion company with comprehensive involvement from manufacturing through to retailing

Trends in total sales of five major select shop companies and UNITED ARROWS LTD.’s market share

Trends in total sales of five major select shop companies and UNITED ARROWS LTD.’s market share