Strengthening Sales of OEM and Custom-Order Products

「In the private-label (PB) business, we are expanding overseas partner production sites to reduce costs, improve quality and broaden product categories. By meeting the needs of major key customers with nationwide operations, we are working to expand our share as a manufacturing partner.」

「Meanwhile, in the private-brand (PB) business, we reduced costs, improved quality and expanded product categories by developing new partner production bases, and strengthened our position as a manufacturing partner by accurately meeting the needs of key sales destinations.」

「In the private-brand (PB) business, we will expand our share as a “manufacturing partner” by developing new partner production sites, reducing costs, improving quality and expanding product categories, while meeting the needs of major sales partners.」

「Strengthening the OEM business as a “manufacturing partner”」

「The gross margin fell 2.7 percentage points year on year to 26.8%, mainly because sales of OEM products rose sharply. Although their headline margins are low, these made-to-order products generate profits stably and efficiently because they are not subject to returns.」

「The gross margin fell 3.5 percentage points year on year to 26.7%, mainly because sales of OEM products rose sharply. Although their headline margins are low, these made-to-order products generate profits stably and efficiently because they are not subject to returns, while the impact of yen depreciation increased the cost of sales of own-planned products manufactured overseas.」

「The gross margin fell 4.0 percentage points year on year to 27.0%, mainly because sales of OEM products rose sharply. Although their headline margins are low, these made-to-order products generate stable profits because they are not subject to returns. Higher cost of sales due to yen depreciation was another major factor.」

「The gross margin fell 1.2 percentage points from the previous fiscal year to 27.8%, reflecting higher cost of sales due in part to the increased proportion of OEM products, which have low gross margins despite carrying no return risk, and the significant yen depreciation toward the latter half of the fiscal year.」

「Gross profit was ¥3,698 million, up 18.9% year on year, but the gross margin fell 0.5 percentage points year on year to 29.5% as the proportion of OEM products increased. OEM products carry no return risk but have relatively low gross margins.」

「Going forward, we will share the expertise gained from developing our own planned products more extensively than before, further deepen our product offerings within existing categories, and expand the range of product categories that can be newly developed. Through these efforts, we aim to deepen business with existing customers, step up new-customer development, increase sales per customer and accelerate further sales growth by adding new customers.」

「In light of these conditions, the business will make expanding sales its top priority by broadening its product categories and stepping up efforts to develop new customers.」

「This category includes sales of makeup-related products, hair-care products, travel products, bath, esthetic and health-related goods, and other products. Revenue for the nine months ended 31 December was ¥7,196 million, down 2.5% year on year, as sales of products for OEM customers remained strong but sales of general retail products declined.」

「Revenue for the six months ended 30 September was ¥4,941 million, up 1.7% year on year, as sales of products for OEM customers and other products remained strong.」

「Revenue for the three months ended 30 June was ¥2,638 million, up 4.1% year on year, as sales of products for OEM customers and other products remained strong.」

「OEM and custom-order products, another core source of revenue, have continued to see higher orders from major customers, supported by our broad product lineup and planning and design capabilities. We will step up efforts in this area, including by strengthening our workforce, developing new customers and adding new items.」

「Revenue for the nine months ended 31 December was ¥2,049 million, down 5.1% year on year, as sales of bags and other products declined, mainly in OEM.」

「Revenue for the six months ended 30 September was ¥1,313 million, down 5.7% year on year, as sales of pouches, cases and other products declined, mainly in OEM.」

「Net sales for the first three months of the current consolidated fiscal year amounted to ¥664.072 million, down 21.3% year on year, due to lower sales of pouches, cases and other products, mainly OEM items.」

「Sales of fashion accessories amounted to ¥2,740.182 million, down 11.8% year on year, due mainly to lower sales of bags, pouches, cases and other products for OEM and custom-order customers.」

「Net sales for the first nine months of the current consolidated fiscal year amounted to ¥2,158.347 million, down 5.7% year on year, due to lower sales of bags, pouches, cases and other products for OEM and custom-order customers.」

「Net sales for the first six months of the current consolidated fiscal year amounted to ¥1,392.037 million, down 10.3% year on year, due to lower sales of bags, pouches, cases and other products for OEM and custom-order customers.」

「Net sales for the first three months of the current consolidated fiscal year amounted to ¥843.883 million, up 1.8% year on year, as sales of pouches, cases and other products, mainly OEM items and custom orders, increased.」

「Sales of character-related OEM and custom-order fashion accessories to specialty stores, variety stores, theme parks and other customers performed strongly, increasing sales of fashion accessories by ¥598.876 million from the previous consolidated fiscal year.」

「Our group actively pursued the expansion of sales of Cosmetic Contact®, a priority product (Note 1), and also worked to strengthen sales of OEM and custom-order products (Note 2) in response to growing demand for differentiation amid intensifying competition in the retail industry.」