Reviewing Profitability by Product and Customer and Narrowing the Number of Concepts

「Sales declined to ¥1,641.583 million, down 2.4% year on year, because orders for certain OEM products were selectively accepted with emphasis placed on transaction profitability.」

「Sales declined to ¥1,059.434 million, down 1.2% year on year, because the company accepted selected orders for certain OEM products, with an emphasis on transaction profitability.」

「Sales of cosmetic accessories edged up 1.0% year on year to ¥6,976.972 million overall. Character-themed accessories and hair-care accessories developed in collaboration with a major food company performed well, but sales were affected by the decision not to introduce products deemed unprofitable at some mass retailers.」

「By reducing sourced products with low margins and continuously raising the share of higher-margin in-house-developed products, sales of in-house-developed products increased to ¥17,850.067 million, up 4.7% from the previous fiscal year. Their share of sales rose 1.9 percentage points, from 83.4% in the previous fiscal year to 85.3%.」

「By reducing sourced products and switching to products developed in-house, sales of in-house-developed products increased significantly to ¥17,048.235 million, up 25.2% from the previous fiscal year. Their share of sales rose 4.6 percentage points, from 78.8% in the previous fiscal year to 83.4%.」

「Measures pursued over the past several years to strengthen the management base, centered on selecting and concentrating the product range and sales channels, switching from purchased products to proprietary products, reducing fixed costs, speeding decision-making through a major organizational overhaul, and reviewing personnel and compensation systems」

「During the six-month period ended in the second quarter, the yen depreciated substantially year on year and the cost of sales rose sharply. Against this backdrop, the company steadily implemented measures pursued over the past several years, centered on selecting and concentrating its product range and sales channels, switching from purchased products to proprietary products, reducing fixed costs, speeding decision-making through a major organizational overhaul, and strengthening its management base, including a review of its personnel and compensation systems, as well as developing proprietary products such as cosmetics and cosmetic accessories. As a result, the company secured an increase in operating profit.」

「During the nine-month period of the first quarter of the consolidated fiscal year under review, the yen depreciated sharply and the cost of sales surged. Nevertheless, we steadily implemented measures undertaken over the past several years, including selective concentration in the number of products handled and customers served, switching from purchased products to products planned in-house, reducing fixed costs, accelerating decision-making through a major organizational overhaul, strengthening the management platform centered on reviewing personnel compensation systems, and developing products planned in-house such as cosmetics and cosmetics accessories. As a result, we secured higher operating profit.」

「Going forward, we will pursue a selection-and-concentration strategy aimed at building a lineup of standard products so that, as a true manufacturer, we will be known as the company to turn to for these products.」

「During the six-month period ended in the second quarter, sales declined to ¥878.766 million, down 13.5% year on year, as the company advanced the selection and concentration of its products, promoting products in focus categories while reducing the number of product concepts, including relatively low-margin eco-bags and pouches.」

「We feel that the initiatives we have continued through the previous fiscal year, including the selection and concentration of SKUs and business partners, the shift from sourced products to products planned in-house, fixed-cost reductions, faster decision-making through a major organizational overhaul, and strengthening the management foundation centered on reviewing personnel and compensation systems, together with the development of planned products such as cosmetics, cosmetic accessories and hygiene products, are steadily beginning to produce results.」

「The sales mix of products planned in-house rose to 77.0% from 73.5% in the previous consolidated fiscal year, including sales from Beauty Door Co., Ltd., which became a wholly owned subsidiary through an acquisition of shares at the beginning of the fiscal year. In addition, active efforts to review the products handled and transaction terms improved the gross margin to 29.5%, up 0.8 percentage points from the previous consolidated fiscal year.」

「During the nine-month period ended in the third quarter, consolidated sales declined 4.0% year on year to ¥10,434.684 million, due to the continued review of profitability by product and customer, as well as the impact of the novel coronavirus disease described above. Sales of proprietary products were ¥7,946.988 million, up 0.6% year on year and essentially flat, while their mix rose sharply to 76.2% from 72.7% in the same period of the previous year.」

「Sales of proprietary products were ¥5,429.764 million, down 0.1% year on year, and were essentially flat. Their mix rose sharply to 76.0% from 71.6% in the same period of the previous year.」

「Sales of products planned in-house decreased slightly to ¥2,840.670 million, down 4.7% year on year, while their composition ratio rose substantially to 76.6% from 72.3% in the same period of the previous year. We believe this reflects the effect of reviewing the products handled, an initiative undertaken since the previous fiscal year.」

「We have traditionally pursued selection and concentration from the perspective of improving profitability by eliminating waste, but going forward we will promote selection and concentration aimed at building a lineup of staple products that will make people say, “For this product, it has to be SHOBIDO,” as a true manufacturer.」

「Net sales for the six months ended the second quarter decreased significantly to ¥7,593.698 million, down 13.4% year on year, due to the continued review of profitability by product and customer and stagnant consumption resulting from the COVID-19 pandemic.」

「Net sales for the nine months ended the first quarter decreased significantly to ¥4,123.391 million, down 12.9% year on year, following a review of profitability by product and customer.」