Achievements have been overwhelming. During the seven years from 1993 to 1999, MUJI’s annual profit and sales maintained double-digit growth, and the number and area of stores continued to rise. The MUJI myth began.
In addition to the increasing market share in Japan, MUJI has also begun to enter overseas markets. In July 1991, MUJI’s first overseas store, MUJI West Soho, officially opened in London. Simple and high-quality features coupled with the freshness of “Japanese style” in the West, MUJI has also been highly praised by overseas consumers.
The sudden brake of Wuyin Myth
But the good times are not long. As soon as entering the 21st century, MUJI has encountered a serious crisis.
Since 2000, sales of MUJI’s stores have continued to decline. By February 2001, even the first loss in history had occurred.
In 2001, Matsui Nakazo took over the ups and downs of good products. Regarding the company’s dilemma, he determined that the reaction of the company’s acute development caused the decline, and listed eight reasons.
These eight reasons come down to three points:
First of all, in the competition with its rivals, MUJI’s original intention of “relenting in building a brand and specializing in manufacturing” was shaken.
Around 2000, Muji’s competitors rose strongly. In the field of clothing, the whirlwind of Uniqlo caused great impact on MUJI. In terms of daily necessities, the rise of hundred-dollar stores such as Daiso also greatly affected the turnover of MUJI.
In order to gain an advantage in the competition, MUJI started a price war. It lowered the prices of some products, but the total sales of the products could not make up for the price reduction.Loss, and the price strategy is extremely disproportionate to the brand image. MUJI seeks to develop best-sellers that fit its own positioning, with unsatisfactory results and deviating from its original track of manufacturing.
Secondly, it adopted an unreasonable store development strategy while pursuing the size and number of stores, while ignoring the company’s ability to develop its products far behind the pace of store expansion.
Operating a store requires a complete supply system. However, at that time, MUJI chose to expand the scale of its stores rather than improve its supply system. After having a large-scale store, a matching product supply system was established.
In fact, when the size of MUJI’s stores reached 500 tsubos (1 tsu ≈ 3.3 square meters), the disadvantages of this development model have already appeared, and the performance has begun to decline. But MUJI has not stopped moving to expand the scale of its stores.
In March 2001, one of MUJI’s largest stores opened in Kyoto’s Kintetsu Department Store, covering an area of 3,365 square meters. MUJI’s first problem is how to fill this huge store with products. There were only 4232 products in the previous year, which is obviously not enough.
So MUJI is equivalent to passively accelerating the pace of product development. The number of product types has increased by 1,094 in one year, for a total of 5,326.
The original MUJI product development capability is not very powerful, and the increase in development speed will inevitably lead to a decline in the quality and design of the product.
A few years later, a customer recalled in an interview that I do n’t know since when MUJI shops and products lost their characteristics and became less attractive.
In the 1990s, the rapid development of MUJI led to the opening of invitations to major shopping malls. no