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Economy

Uniqlo aims for just local enough

Tadashi Yanai aims for a global clothing brand that can satisfy diverse markets

Fast Retailing Chairman and CEO Tadashi Yanai

Uniqlo operator Fast Retailing is planning to expand its lineup of localized products without sacrificing its globally recognized identity.

"We will offer more variations [in our items] to meet our customers' growing need for modest clothing," Fast Retailing Chairman and CEO Tadashi Yanai said.

In collaboration with British designer Hana Tajima, Fast Retailing sells Muslim-oriented clothing such as hijabs for women and baju melayu for men. Yanai said the company intends to strengthen its ties with Tajima, as well as look into other localization opportunities.

"If we were to sell our products in even stricter Muslim countries, we would have to make sure they were suitable for that," Yanai told the Nikkei Asian Review. "If we were to sell our clothes in India, they may have to conform to Hindu [requirements]," he said.

But he is also cautious about going too far in that direction. "We are a global brand," Yanai said. "If we localize too much, we will lose our edge."

A flagship Uniqplo outlet in Tokyo's Ginza district

Maintaining the right balance between global and local items is crucial to successfully operating a rapidly growing business, not least because poorly executed localization efforts could lead to a stockpile of unwanted products.

"Asians share a similar body size, [even though] popular colors or skirt lengths may differ in different markets," Yanai said. "Our global products can be sold anywhere."

Fast Retailing plans to roughly double the number of Uniqlo outlets in China to 1,000 by 2020, which would be more than in any other country.

Operating more stores in China naturally means hiring and training more staff. Asked how the company will go about that, Yanai said, "We look for talent who can work not only in China, but also in Tokyo or Europe or anywhere in the world."

Fast Retailing has recently been pursuing a strategy of "don't make, ship or sell unwanted products." Consumer research and inventory management are crucial to achieving that goal.

"Currently, Uniqlo stores in South Korea are doing the best job in living up to that slogan," Yanai said. "The stores in Japan are lagging the most."

Overall, Yanai sees a brighter future for the company, especially in the Asian market, thanks to a growing middle class in the region and a robust global economy.

"The world is more global, more digital," Yanai said. "In such a world, universal values like truth, goodness and beauty will prevail over frameworks like countries or vested interests."

In Yanai's view, the digitized world "lacks a center," and people construct their own unique lifestyles as they see fit. Uniqlo is ideally positioned to capitalize on this trend, he said, because it was the first to "democratize" clothing.

"When you look at the history of clothing, it was originally just to satisfy basic needs," he explained. "Then it became associated with class and occupation. But in Japan, where the middle class was prevalent, there were no stereotypes associated with clothing." This, he said, led to Uniqlo's concept of producing high-quality apparel for all -- regardless of age, sex or ethnicity.

AVOIDING AMAZON Fast Retailing now has more than 3,000 stores worldwide, including brands other than Uniqlo. Yanai chalked this success up to the group's approach: producing clothing by anticipating "how consumers' lives will change." He vowed to continue with this strategy, harnessing information technology along the way. But he insisted that a relationship with one of the world's biggest IT players -- Amazon.com -- is out of the question.

It is "impossible for a single company to monopolize everything," he said, explaining his steadfast refusal to sell Uniqlo products on the dominant online marketplace.

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