After burning its fingers last time around, Uniqlo has returned to London in a new incarnation. Amy Shields meets Fast Retailing chief executive Tadashi Yanai

Six years ago, Japanese fashion retailer Uniqlo made its first move on the UK. It expanded fast, but just two years after its arrival, it closed 18 of its 23 stores. That was a chastening experience. But, instead of beating a hasty retreat, Uniqlo has taken the knock on the chin and returned with plans to make its newest London store an exemplar of its global ambitions.

Today’s Uniqlo is very different from the one that arrived in the UK in 2001. The new shop, 311 Oxford Street, has played host to a number of short-lived retail incarnations in recent years, but Fast Retailing – Uniqlo’s parent company – is insistent that it will fare better than previous occupants Waterstone’s and Tesco. The shop is Uniqlo’s first European flagship and the retailer has plans to take on H&M, Topshop and Zara.

“I believe that London is perhaps the most competitive market in the world but, at the same time, it is the most open,” says Fast Retailing chairman and chief executive Tadashi Yanai. “It provides a level playing field for people to come and offer the best of what they can do to London and the world.

“I would compare London to the fashion Olympics. All the major competitors are here in London and those that succeed here can also succeed in the global market. It is our intention that we will be one of those successful players.”

Yanai has ploughed£10 million into opening the flagship store and another smaller site at 170 Oxford Street. The openings take its store count on the UK’s number one retail destination to three. Uniqlo has 13 stores in the UK and Yanai says the two London openings will double Uniqlo’s UK retail sales.

The plan is not to replicate what happened when Uniqlo first came to the UK, rolling out stores rapidly around the country at huge rents that the sales could not support, but to focus on flagships in key cities.

“We have taken the totality of the experiences in Japan, New York, Hong Kong and China and tried to refine that experience and concept,” he explains. “I think this flagship will further help represent what Uniqlo is to the world. In terms of the products, they are increasingly sophisticated and superior to what we have done in the past.”

Uniqlo has evolved from its fast-fashion, value-focused positioning to create an edited range to appeal to London’s shoppers and tourists. The London stores focus on its cashmere and jeans selections, with a blend of Eastern and Western elements, as well as t-shirt bars that sell the tops in plastic canisters.

The Uniqlo logo now features both Japanese characters and an English version and its latest global ad campaign features quirky uber-hip London-dwellers, such as hip-hop artist Dizzee Rascal and Skins actor Nicholas Hoult.

Yanai says: “Our ad campaign says ‘From Tokyo to London’. I think it is very appropriate – we are, after all, a Tokyo brand, but Uniqlo products are fashionable basics. So what’s the message? Perhaps a symbiosis or integration of the East and the West, but turn that into a global brand, into a global message.”

First stop: London
Yanai will not only bring the Far East to the UK, but will use the London stores as a springboard to take the brand to the rest of Europe. He says: “My immediate dream would be to have a flagship store in Paris in the next year or two. At that point, we would be able to create a network of flagships in the major metropolitan areas of the world: New York, Tokyo, London, Paris, Hong Kong.”

A property in the centre of the French capital is under negotiation and a smaller Parisian store is set to open in December in the La Defense quarter. “We are interested in other European, Asian, US and Chinese cities,” adds Yanai. “Perhaps, in the longer term, India as well. We live in exciting times. There is great opportunity out there for many people, ourselves included.”

His enthusiasm has not been dampened by the sting of Fast Retailing’s US$900 million (£436.5 million) bid for iconic US retailer Barneys New York being scuppered by Dubai private equity group Istithmar. He says the company is still acquisitive and is considering options in the US, the UK and the rest of Europe.

Fashion experts are impressed by what Uniqlo has achieved, both in terms of stores and product. Alison Bishop, senior editor at global trend service WGSN, says the retailer is going “from strength to strength”.

“The Oxford Street stores feature unconventional visual merchandise displays such as cylindrical clear glass displays that continuously turn around, as well as a central stage area for visual impact in the middle of the ground floor,” she says.

“As for the actual product, the designer collaborations with the likes of Adam Jones and Lutz & Patmos will pique fashionista interest, while seasonal promotions such as the Pantone colour link-up for cashmere are genius marketing examples.”

Pali International analyst Nick Bubb says getting it right in the UK the second time around is crucial if Fast Retailing is to realise its investment and global expansion plans for Uniqlo. “Uniqlo is looking like a far more promising second entry compared with six years ago,” he says. “It has clearly gone more upmarket and has good niches with cashmere and jeans and the t-shirt bar.” He adds that it is good competition for Topshop, River Island and H&M and has invested a lot in Oxford Street. “It has got to be seen to make that work,” he says.

However, mid-market fashion is crowded and the competition cut-throat, and Bubb warns that, while the brand will appeal to London’s constant stream of tourists, it has chosen another tricky year to launch. In 2001, it came up against a warm autumn; this year, interest rate rises are biting. “The UK retail scene is slowing down,” he says. “Uniqlo is moving upmarket, but it may find that the consumer wants to go in the other direction.”

Yanai says he has learnt from the last time Uniqlo entered the UK market with rapid expansion plans in mind and is more cautious about future openings. He says: “When people say I would love to have Uniqlo in my neighbourhood, that is when I would like to begin to expand to wherever there is demand.”

But he is not fazed by the crowded UK fashion market. Yanai says he looks to Marks & Spencer, Next – “at its creation” – Topshop, Zara and H&M as key players. “Some of us compete against each other, some of us overlap, but I don’t think we are complete competitors,” he says.

“We each offer something different. Its good fun to compete and co-exist. The UK is a large enough market for us to succeed in our own individual way.”

With the success of Fast Retailing’s Comptoir des Cotonniers brand, the UK is braced for more of the company’s fashion fascias, including the opening of standalone stores for its womenswear brand Theory and lingerie label Princesse Tam.Tam.

“These are all brands we would like to see successful here,” says Yanai. “London is a showcase for the world and we are looking forward to not just Uniqlo, but all of our companies opening and become successful in the UK.”

Uniqlo: store tour

By John Ryan

Uniqlo opened its London flagship last week, in a property formerly occupied by Waterstone’s store on Oxford Street. The 25,000 sq ft shop is spread over three floors and is the retailer’s largest UK outpost to date.

The store, designed by Tokyo-based interior design company Wonderwall, incorporates a number of features not previously included in the retailer’s store interior blueprint, a series of glass cylinders being foremost among these. Positioned on the ground and first floors, they contain turntables on which mannequins have been placed and rotate continuously.

Other elements not previously seen in the UK are a video wall set into the stairwell at the front of the shop and a large lightbox in the middle of the ground floor with illuminated squares, highlighting a Pantone promotion of brightly coloured cashmere knitwear.

Downstairs, the men’s department is home to a rectangular steel and glass display case with an illuminated base. This contains more mannequins, organised in a line and dividing the space. There are also natural wooden male body forms on this floor that are set into niches around the walls. All floors have supermarket-style checkouts – a departure from the tiled counters used in other UK branches.

Uniqlo chief operating officer Simon Coble says: “In terms of flagships, we now have three. We opened one in Tokyo two years ago and one in SoHo in New York last November. The Oxford Street flagship has been adapted to suit the London trading conditions and environment, but it follows the same lines. This will be the only flagship in the UK and our expansion will depend on how it performs.”

A 17,000 sq ft sister shop at 170 Oxford Street opened at the same time. While it is not a flagship, according to Coble, it follows the same design thinking.

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