Consul L t ni g* Giving&Uniqloagrowth& strategy&for&the&future€¦ · Future! M! C o n s u l t i n...

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Giving Uniqlo a growth strategy for the future

Uniqlo Tadashi Yanai

MGLP Consul/ng Kaiserslautern Christopher Puetz, Sophie Mentges, Anuschka Gummel, Aamir Lakdawala

03/03/15

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Main Challenge

3/3/2015 MGLP ConsulEng Kaiserslautern 2

How to become a well known and successful brand in the global fashion industry?

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Agenda


Current Issues

Analysis

ImplementaEon

AlternaEves

Conclusion

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Key issues


Need to expand globally

Strong compeEEon

Weak presence in U.S. & Europe

Low global brand

awareness

No global supply chain

Current SituaEon Analysis AlternaEves ImplementaEon Conclusion

No producEon line in U.S. &

Europe

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Objec?ves



Restructuring supply chain

Maintaining high-‐quality level

Increase sales by 10 % each year

Increase global brand awareness

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Business model



0 5

10 15 20 25 30

2008 2009 2010 2011 2012 2013 2014 2015 year

In Bn. USD Sales growth Key

partnerships

Supplier Uniqlo

Supplier

Supplier

Close partnerships

Key Resources

Intellectual

Human

Physical

Brand in Asia, InnovaEons, Know-‐How


Stores, Online-‐Shops, R&D centers

Core competencies Fashionable

High quality

Affordable

Comfortable Value proposiEon

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Business model



0 5

10 15 20 25 30

2008 2009 2010 2011 2012 2013 2014 2015 year

In Bn. USD Sales growth Key

partnerships

Supplier Uniqlo

Supplier

Supplier

Close partnerships

Key Resources

Intellectual

Human

Physical



Stores, Online-‐Shops, R&D centers

Core competencies Fashionable

High quality

Affordable

Comfortable Affordable LifeWear

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Retailing business model



R & D Designers, Pa=ern-‐makers create innova/ve products

Tokyo, NY, Shanghai

Paris, London, LA

Future

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R & D Designers, Pa=ern-‐makers create innova/ve products

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R & D Maufacturing

Joint venture with

Bangladesh China

External supplier

Designers, Pa=ern-‐makers create innova/ve products

Tokyo, NY, Shanghai

Nego/a/ons

Paris, London, LA

Future

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R & D Maufacturing

Joint venture with

Bangladesh China

External supplier

MarkeEng

Sales Promo/on


Tokyo, NY, Shanghai

Nego/a/ons

Paris, London, LA

Future

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R & D Maufacturing Warehouse

Joint venture with

Bangladesh China

External supplier

MarkeEng

Sales Promo/on

Tier 1

Online stores

Stores, Flagship-‐Stores

Home delivery

Japan InternaEonal


Tokyo, NY, Shanghai

Nego/a/ons

Paris, London, LA

Future

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R & D Maufacturing Warehouse

Joint venture with

Bangladesh China

External supplier

MarkeEng

Sales Promo/on

Tier 1

Online stores

Stores, Flagship-‐Stores

Home delivery

Japan InternaEonal

End customer


Tokyo, NY, Shanghai

Nego/a/ons

Paris, London, LA

Future

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Customers by area



Customers

Asia InternaEonally

U.S. Japan India Europe China

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Customers by area



Customers

Asia InternaEonally


•  Low income •  Live in big

ciEes

•  Want the newest trends

•  Strong brand loyalty

•  Low income

•  High populaEon growth

•  Interest in new, affordable fashion brands

•  Largest market in GDP

•  Interest in innovaEve products and high quality

•  High income

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Customers by area – common interests



Customers

Asia InternaEonally


•  Great variety of colors •  Affordable prices •  Hungry for trendy fashion apparel •  Rising willingness to spent money on fashion

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Perceptual map -‐ compe?tors



Global presence

Price/quality ra/o

Uniqlo

H&M

Zara

Esprit

Asos

Nike

high

high

low

low

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Perceptual map -‐ compe?tors


How to become a producer for innovaEve products by keeping cheaper prices than internaEonal compeEtors?

Global presence

Price/quality ra/o

Uniqlo

H&M

Zara

Esprit

Asos

Nike Uniqlo

Sell affordable prices all over the world

high

high

low

low


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Analysis overview



Internal

External

Strengths:

•  High quality

•  InnovaEveness

•  Low producEon costs

Weaknesses:

•  Weak global presence

•  Low brand awareness

Opportuni/es:

•  Growing demand in good quality products

•  Growing populaEon

Threats:

•  Strong global compe//on

•  High brand loyalty in mature markets

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Feasible Alterna?ves



Focus on domesEc market Expand globally

•  Expand in U.S. & Europe

•  Build stores end expand Online presence in

mature markets

•  Chance to become a global brand

•  Build brand reputaEon world-‐wide

•  Strong demand for innovaEveness

•  Focus on Indian market

•  Expand amount of stores in China & Japan

•  Good brand reputaEon in a well-‐known

market

•  High compeEEon

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Objec?ves



Maintaining high-‐quality level




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Evalua?on




Maintaining high-‐quality

level



Focus on domesEc market

Expand globally

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Evalua?on




Maintaining high-‐quality

level



Focus on domesEc market + ++ -‐-‐ 0

Expand globally + 0 ++ +

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Dimension

Cluster Main challenge

Supply Chain

•  Local supply chain •  Missing global access •  No producEon faciliEes

Retailing

•  Strong compeEEon •  Weak presence in US & EU market •  No just-‐in-‐Eme in US & EU market possible

Products & Customers

•  Low brand awareness in US & EU market •  Necessary to stay innovaEve



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Implementa?on schedule

2015 2016 2017 2018 2019 2020

Supply Chain

Retailing




Plan Contact partners

Contract with partners

Building JV

ProducEon Mexico

ProducEon CR

Develop pull strategy Expand producEon in Mexico

Expand producEon in CR

ConEnuously improve partnerships

Plan Expand in China

Develop

US market expansion

Window stores expansion Plan

EU market expansion Create app Develop app

Retail support through app

App improvement

Collect app data

Customized designs through app

Improve R&D Develop Plan

Increase brand awareness

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Supply chain -‐ idea



•  Providing just-‐in-‐Eme producEon and delivery •  Less warehouse cost

Pull strategy

•  Joint Venture in Czech Republic with F & F •  Close by producEonà Low transportaEon cost

EU supply chain

•  Join Venture in Mexico with Mexi-‐fashion •  Close by producEonà Low transportaEon cost

US supply chain

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Supply chain -‐ details


Manufacturing

Asia InternaEonal

External supplier

New Joint Ventures

Mexico for U.S. market

Czech Republic for Europe market


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2015 2016 2017 2018 2019 2020

Supply Chain

Retailing






Building JV

ProducEon Mexico

ProducEon CR





Develop

US market expansion




App improvement

Collect app data




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Retailing -‐ idea



•  Development of Mobile App (Uniqlo Fashion World) •  Increasing reachability

Mobile app

•  Providing new fashion experience to customer •  Fast & global expansion of stores

Stores & window shops

•  Introducing Click ‘n’ Collect facility •  Upgrading Online Website

Online retailing

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Retailing -‐ Detail



•  Development of Mobile App to include QR code

•  Customer enters the details of purchase and generates QR code

Mobile app

Uniqlo Fashion

•  Customer can order & pay on mobile app

•  Possibility to collect at store

•  Possibility to try and change if necessary

Click & collect

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Uniqlo Fashion

•  Small Size shops •  Window with no counter and no sales staff •  Customer can see products in real life •  Picking through touch panel •  Scan of QR code, ordering through app •  Product will be delivered

à Low costs for rent & staff à Physical presence of products

Window shops

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•  Countries to expand: •  US •  UK •  France •  Germany •  Italy •  Netherlands

•  Stores: •  Open flagship stores in major ciEes (London, Paris, Berlin, NY, LA) •  Open window shops à for each flagship store 5-‐10 addiEonal window shops

Store expansion

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2015 2016 2017 2018 2019 2020

Supply Chain

Retailing






Building JV

ProducEon Mexico

ProducEon CR





Develop

US market expansion




App improvement

Collect app data




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Products & customers -‐ idea



•  Customize design to cater European and US customers

Design

•  Increase the brand awareness through online media

Brand

•  Incorporated the collected data from customers to improve R &D

R&D

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Products & customers -‐ details



•  Customers can play with design on mobile app •  Mobile app sends dram to designer team •  Choice of customer designs become part of collecEon

Design

•  Improving & boosEng the downloads of app •  AdverEsement on Android app store •  Support through social medias

Brand

•  AdapEng customized design in the pornolio

R&D

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Implementa?on summary

Cluster Main challenge Solu/on

Supply Chain •  Local supply chain •  Missing global access •  No producEon faciliEes

•  Pull strategy •  ProducEon plants in Czech Republic &

Mexico

Retailing

•  Strong compeEEon •  Weak presence in US & EU market •  No just-‐in-‐Eme in US & EU market

possible

•  Flagship-‐stores •  Window shops •  Online retailing àConnecEon through app


•  Low brand awareness in US & EU market

•  Necessary to stay innovaEve

•  ConEnue R&D efforts •  Capture product trends through app &

data analysis



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Investment overview



•  JV & produc/on facili/es: •  Mexico: U$ 150 million •  Czech Republic: U$ 147 million

• Mobile app: •  Development: U$ 120 million •  Running: U$ 20 million

•  Store expansion: •  Stores U$ 1.41 billion • Window shops

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Projected expenses

2015 2016 2017 2018 2019 2020

Supply Chain

One-‐Eme 120 150 147

Running 10 15 18 11 10 10

Retailing One-‐Eme 120 200 500 400 200 110

Running 20 30 80 30 10 15

Products & Customer

One-‐Eme 10

Running 15 12 12 12 13 14

Sum 295 407 757 453 366 149


NPV of projected expenses: U$ 2.224 billion

In million U$


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Global revenue projec?on


Best case scenario with 74.6% growth of revenues within 6 years

In billion U$


23.19 25.26 26.4 27.8

33.4 36.2

40.5

23.19 24.3 24.5 25.1

29.7 31.4 34.5

0

5

10

15

20

25

30

35

40

45

2014 2015 2016 2017 2018 2019 2020

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Benefit overview


Establishing a global brand


•  Growth 74.6% within 6 years

•  Reaching U$ 40.5 billion of revenues in 2020

•  Increased number of stores

Tangible benefits

•  Build a global brand

•  Increased brand awareness on global markets

•  Global supply chain with fast delivery

Intangible benefits

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Risks & con?ngencies



I.  Low acceptance rate in EU & US

II.  Failure of JV

III.  Delay on development of mobile app

Risks

I III

II

Probability

Impact Non-‐acceptable area ALARP area Acceptable area

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Risks & con?ngencies



I.  Low acceptance rate in EU & US

II.  Failure of JV

III.  Delay on development of mobile app

Risks

I.  Market research

II.  Using & expanding exisEng manufacturing

faciliEes in China

III.  StarEng with minimal features of the mobile

app

Con/ngencies

I III

II

Probability

Impact Non-‐acceptable area ALARP area Acceptable area

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Thank you

Consul L t ni g* Giving&Uniqloagrowth& strategy&for&the&future€¦ · Future! M! C o n s u l t i n...

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