A return to domestic production in response to inflation and yen depreciation

「Mid-upper brands operating mainly through department stores are developing differentiated, high-value-added products that express their brand identity, while vertically integrating their in-house manufacturing structure to return to domestic production and reduce exposure to global inflation and sharp foreign-exchange movements.」

「Mid-upper brands operating mainly through department stores have begun initiatives to improve profitability further by vertically integrating their domestic in-house manufacturing structure and returning to domestic production, while developing differentiated, high-value-added products that retain their brand identity and reducing exposure to global inflation and yen depreciation.」

「The company is also steadily returning to domestic production by utilizing its own-factory structure, in order to reduce exposure to recent global inflation and yen depreciation.」

「In terms of profit, although product delivery delays associated with China's lockdowns and higher purchase prices due to rising global energy prices and the yen's rapid depreciation had an impact, the Group rebuilt its supply chain strategy, including a return to domestic production for its middle-to-upper-market businesses, reviewed prices, materials and specifications to set optimal retail prices in line with the value-price balance, and focused on full-price sales through both stores and e-commerce channels.」

「The company rebuilt its supply-chain strategy, including a return to domestic production for its mid-to-upper-market businesses, and reviewed prices to optimize recommended retail prices in line with the balance between value and price. It prioritized full-price sales through both its stores and e-commerce channels. These strategies paid off, enabling further improvement in its selling approach. As a result, the gross profit margin improved by 2.4 percentage points year on year to 57.9%.」

「We are also accelerating the return to domestic production to reduce our exposure to recent global inflation and foreign-exchange trends involving yen depreciation.」