Why Do MUJI Products Slow Down Sixth Times?

If you went there last weekend

(MUJI) shops will find many commodities marked "new pricing".

According to the world clothing shoes and hats net, these commodities are basically printed products, which are mainly pushed by Pan household products. The price range is less than 5%, up to 20%.

This is the sixth price adjustment of this company since 2014.

Such a price adjustment frequency can be seen frequently.

The price reduction is obviously beyond doubt.

When the company first entered China, the price of the product was recognized by some people who knew the brand as "virtual high".

Some people even bluntly pointed out that in Japan, Muji is actually a "grocery store", but in China, it has been sold as a way of selling life.

Retailer.

Earlier, in an interview with reporters, Yamamoto Naomiyuki, general manager of Muji (Shanghai) Commercial Co., Ltd. also expressed the same meaning. He explained several times (downward) price adjustment because the initial company entered China.

When the order to the factory is small, the unit price is relatively high.

But with the development of over 10 years, the demand for sales of goods has increased.

In other words, the increase in orders has led the foundries to produce at lower overall prices, which ultimately reduced the cost of each product.

Moreover, some external policies have also played a role.

For example, Muji cosmetics are basically imported, but due to several import tariff adjustments and waiver, the prices of related commodities are also changing.

Reviewing the development of Muji in China is not a smooth sailing.

In the first year after entering the Chinese market in 2005, the company opened shop only at the speed of one digit per year. But after 2012, "high popularity" made Muji become the "top guest" of the major commercial real estate developers, and began to accelerate expansion. By the end of 2016, 200 shops were opened.

But behind the crazy shop is the price that the company needs to pay.

Japanese enterprises have always been more conservative and prudent management strategy has been pursued by Muji.

The company even set up a "shop benchmark book". Its assessment contents include the market (area, retail turnover, population, age ratio, income gap, etc.), commercial facilities evaluation (station location, parking lot number, tenant number, etc.), three categories of shops (area, Muji member network, distribution, etc.) more than 20 projects, staff according to objective data to give a score to judge, to achieve the standard before approving shop, to ensure that the profitability of its stores.

However, this strategy began to get loose and changed after the company realized the huge business opportunities in the Chinese market.

Before this wave of shop opening, the company's average investment in all the stores in the mainland was only 15.9 months.

But now such a cycle is bound to be stretched.

According to some professions, under normal circumstances, a new shop in a business centre, with a good location and a small area (unless there are special circumstances such as rent free, decoration subsidies, etc.), will take two to three years to recover the operation cost at normal cost.

Behind the accelerated opening up, the growth of Muji in China has slowed down.

Although growth is still growing, according to the latest earnings report of its parent company, the Muji China market has only gained 0.8% growth over the three quarter of last year, a marked slowdown than the first two quarters, compared with 4.7% and 5.4% in the two quarter.

This is still in the 23 quarter of the three quarter of the Chinese mainland market.

Even so, Muji is clearly trying to win more Chinese customers.

After all, China's market revenue has now occupied a large proportion of Muji sales.

In the 2015 fiscal year, the revenue of the East Asia Division (Korea, China) amounted to 83 billion 45 million yen (about 4 billion 314 million yuan), accounting for 27% of the total revenue of the company.

In China, the mainland alone has a revenue of about 49 billion 867 million yen (about 2 billion 590 million yuan).

When Yamamoto Naomiyuki opened 200th new stores at the end of last year, he announced that there will be two new pricing activities for Muji in 2017.

But don't be too happy, because unlike the localized production localization of local products of some of its "gowns" UNIQLO products, even if printed in China, MUJI products will still be shipped to Japan and then sent back to China for sale, resulting in increased supply chain management, distribution, pportation and tariff costs.

This makes people feel superfluous, but in fact, they do.

This approach makes the company appear less flexible, and of course, they may make some changes in the future.

After all, if we want to expand our scale in the overseas market, if we do not make a long-term adjustment of the overall price strategy, how much will the phased price adjustment of some products attract customers to the brand?

Aside from those feelings of literature and art, the urban youth who pursue the way of life away from the second tier cities intend to attract consumers in other small and medium-sized cities. Price positioning is always a topic that can not be carried away.

What we can see is that many homegrown chain stores like Muji models have been bloomed in recent years, so Muji should be clear about what to compete with these brands.

More interesting reports, please pay attention to the world clothing shoes and hats net.