Maturation of the Domestic Apparel Market and Digital-Driven Changes in Purchasing Behavior

「EC transaction volume Consolidated transaction volume 22,120 141,840 15.60 △1.01」

「In sales revenue, store sales were affected by the waning of the boost from the return to in-store shopping following the transition of COVID-19 to Category 5 under Japan's Infectious Diseases Control Law in the previous year, but strong EC sales more than offset this impact, resulting in significant growth from the same period of the previous year.」

「In fact, same-store sales exceeded the previous year for 22 consecutive months through December 2023.」

「In revenue, store sales consistently exceeded the same period of the previous year, led by apparel, as economic and social activity normalized following the reclassification of COVID-19 to Category V and demand for going out and urban customer traffic continued to recover.」

「In sales revenue, progress in COVID-19 measures and the easing of behavioral restrictions encouraged the return of customer traffic, and the recovery in demand for going out and urban customer traffic continued.」

「In sales revenue, the return of customer traffic accompanying progress in COVID-19 measures and the easing of behavioral restrictions supported a continued recovery in demand for going out and urban customer traffic. Although COVID-19 resurged intermittently in the seventh wave from July and the eighth wave from November, store sales generally continued to grow significantly from the previous year.」

「In sales revenue, as in the first quarter, no state of emergency or other declaration related to COVID-19 was issued during the second quarter, allowing normal operations without commercial-facility closures or shortened operating hours, and the recovery in demand for going out continued as customer traffic returned. Although the resurgence of COVID-19 in July and the landfall of typhoons in September had negative impacts, store sales grew significantly from the previous year.」

「Demand for going out recovered in both apparel and household goods as customer traffic returned, including a Golden Week without commercial-facility closures or shortened operating hours for the first time in 3 years.」

「However, existing-store sales exceeded the same period of the previous year in both the second half, following the first half, and the full year by 5.2 points, due to fewer store closures and shorter operating hours than in the previous year, the continued strength of demand for autumn and winter apparel, particularly apparel products, as demand for going out recovered, and resilient demand for spring ceremonies.」

「In the third quarter, existing-store sales were 5.7 points above the same period of the previous year, as demand for autumn and winter apparel, particularly apparel products, remained strong against a backdrop of the lifting of the state of emergency and favorable weather and temperatures.」

「In addition to the expected impact of large-scale store closures associated with structural reform, weak consumer sentiment caused by people refraining from going out following the continuous issuance of states of emergency and the rapid spread of the Delta variant persisted for longer than expected.」

「While mid-to-upper-market brands primarily operating in department stores develop differentiated, high-value-added products, they are also required to adapt to changes such as the decline in demand for commuting apparel accompanying changes in lifestyles, including by adopting more casual styles while retaining their brand identity.」

「The Company struggled because it was unable to respond adequately to customers' shift from on-demand needs for women's apparel for going out and commuting, an area of strength, to off-demand needs centered on staying at home.」

「In apparel, sales recovery has been seen at Shularoo, which is mainly located in neighborhood shopping centers, but the recovery in customer traffic has been challenging, particularly at department stores in central urban areas and around stations and terminals, which had previously been high-traffic locations. Meanwhile, lifestyle-goods stores supporting life during the COVID-19 era performed strongly, with Ones Terrace, which offers a wide variety of household goods, and 212 Kitchen Store, which successfully captured demand for eating at home, maintaining sales above the same period of the previous year.」

「The return of customer traffic since June has varied by sales channel. While recovery has been slow at stores around stations and terminals and at department stores in central urban areas, which are high-traffic locations, sales at Ones Terrace, which supports lifestyles during the COVID-19 era and offers a wide variety of household goods, and at 212 Kitchen Store, which successfully captured demand for eating at home, were well above the previous year.」

「In the fashion industry, the domestic apparel market centered on conventional store-based sales is maturing as the population declines against a backdrop of a falling birthrate and an aging population. At the same time, the competitive environment is changing significantly as consumer purchasing preferences and behavior diversify, with the expansion of EC (e-commerce) accompanying the progress of digitalization and the spread of services addressing the sharing economy.」

「Meanwhile, new entrants can be seen in the emerging fashion market against a backdrop of increasingly diverse consumer purchasing behavior, including the expansion of EC (e-commerce) accompanying the progress of digitalization and the emergence of sharing-economy services such as rental and resale.」

「As Japan's domestic apparel market has matured further, customers have continued shifting from physical stores to e-commerce against a backdrop of advancing digitalization, while industry consolidation has become unavoidable, also driven by business succession.」