Will Only 75 GAP Stores Remain Closed In The Japanese Market?

　　 GAP The first of its three brands is Banana, which is of medium and high price and tends to be aristocratic Republic; Second, it is similar to Uniqlo's style Uniqlo Popular Old navy with higher price; There is also the original and authentic GAP.

According to the World Clothing, Shoes and Hats Network, In the first quarter of 2015, Gap announced the closure of 175 stores in North America and 140 stores in 2016. This trend and others fashion The closing rhythm of clothing brands is consistent.

In the Japanese market, there were 49 stores in Banana Republic and 161 stores in GAP by April 20, 2017, and Old was closed Navy has 53 stores and 75 stores in total. The Park Avenue store near Shibuya, once the flagship store of GAP, will also be closed on May 7, losing about 28 billion yen in sales performance.

　 Will it continue to close?

Old Navy Close - Internal Analysis

Old Navy entered the Japanese market in 2012, taking Uniqlo as a competitor.

First, price strategy. The price is twice that of the United States. When Japanese consumers see that its cost performance is not as good as that of Uniqlo, they want to wait for a discount before buying it. They feel that it is a fool to buy genuine products, which leads to the sales of genuine products being blocked.

Second, the style and color are mainly designed according to the American figure and color preference. The shoulders are wide and the color is dark, which does not conform to the Japanese consumers' shape and color preference. Even if the discount is large, it will not sell.

Third, turnover update. Due to the limited number of stores and low-end brands, the turnover is difficult, and seasonal new product replenishment cannot keep up, which is the same reason as Uniqlo's unprofitable store in New York for more than 10 years.

Fourth, the impact of online shopping. The online shopping rate of fashion clothing in the United States has reached about 30%, and that in Japan has also reached about 19%. According to expert analysis, the online shopping rate of 25% may be the critical line. Beyond this value, physical stores will usher in a peak of closure.

　 Evaluation of new stores in Japan - external analysis

Some organizations have tracked and evaluated the new commercial facilities and stores opened in Japan since 2012. The indicators are divided into nine levels (AA, A+, A, A -, B+, B, B -, C, D). The brief conclusions are as follows:

At the beginning of 2016, according to the evaluation of 39 commercial facilities opened in the past three years, the difference between good and bad was basically the same. The success rate of new stores was 20.5%, and the failure rate was 51.3%.

At the beginning of 2017, according to the evaluation of 34 commercial facilities opened in the past three years, the success rate of new stores was 2.9%, and the failure rate was 79.4%. More than 20% of the 448 stores involved are ready to withdraw.

In general, the budget targets can be reached for entertainment and catering, while most of the rental stores of fashion clothing can not meet the budget. Among the international fashion brands, Uniqlo and its sub brand GU have a flat effect in the Japanese market of between 240000 and 260000 yen, the best ZARA of foreign brands is about 170000 yen, GAP, H&M is about 130000 yen, and some shopping mall stores are only about 100000 yen. The days are hard.

According to the general business store opening habits, 30% of the failures are suicidal, and 80% of the failures are collective suicides. Knowing that the risk is great, we still need to open a store, and we are fighting for the risk!

　　 Enlightenment to us

First, the essence of physical stores is product innovation. If product innovation fails to keep pace, it will lose the fundamental reason for customers to patronize. In 2016, Chinese people purchased 1.03 trillion yen of Japanese goods online, and actually purchased 1.47 trillion yen in Japan, which is equivalent to the performance of half of Japan's department store industry, while Americans purchased only 615.6 billion yen of Japanese goods online. Obviously, the difference in our competitiveness lies not in the channels, but in the products themselves.

Second, from the evaluation of the closing of the store to the opening of the new store in Japan's GAP, with the continuous growth of the proportion of online shopping, it is not enough for physical stores to only innovate products. It is necessary to analyze customer needs according to the regional market culture and customs, level by level and category, and configure different personalized products online and offline, including physical goods and cultural or spiritual products.

Third, the large-scale closure of regular price stores in the United States, while online stores, fast fashion stores and brand discount stores are doing well, indicating that the customer value of regular price stores has completely collapsed. The customer value of the so-called regular price stores in China is even more shameful.

We should see clearly the value of brand discount stores, focus on finding new customer value points, open up new product channels, and create outlets with low price, high quality and better cost performance.

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