Forget Weed, Maybe It's Ecstasy
A few weeks ago, I suggested that Tadashi Yanai, President and CEO of Fast Retailing (parent of Uniqlo), must be smoking something, as he declared he would have 1,000 stores opened in the U.S. by 2020. Not long after, I read in WWD.com, which covered the company's annual media event, that his aim is to reach $253 billion (yes, USD), in global sales by 2030, up from their August current year-end revenue projection of about $13 billion. His new projection for 2020 was $42 billion, which by the way, is way lower than $61 billion target I had reported that Mr. Tadashi had projected in the article. So, which numbers are we to believe?
And, even with the lowered projection for 2020, does the $250 billion goal for 2030 sound like something a person with all of their marbles would throw out at such a meeting? Mr. Tadashi said, "So we are within sight of 5 trillion yen, ($42 billion) and that's not just big talk. I think soon we have to start making big ambitions for the year 2030 as well, and if it's the year 2030, why not 30 trillion yen ($253 billion)?" The audience laughed thinking that this must be Yanai's type of a Japanese joke. He responded, "It's not a joke. I believe it's possible that we can realize this dream."
I was so flabbergasted I just had to follow up on my past article to advise my readers that this guy has got to be on something much stronger than weed, based on my limited knowledge of drugs, even though "... I didn't inhale." I have never sampled Ecstasy (too bad for me I guess), but I am told that it does a great job unlocking dopamine in the human brain, providing feelings of euphoria, well being, satisfaction and can even result in addiction.
Apparently still in the euphoria stage, Yanai went on to say, "The year 2020 is right around the corner, so we have started to talk about 2030. We have to look ahead." His main targets for growth are the U.S., Europe and China.
A logical question for such audacious goals was raised from the audience about any acquisitions Mr. Tadashi might have in mind (obviously to help in reaching the $253 billion number). Allowing that he would be interested in good brands with a "compatible appeal across the world," he said organic growth would be the primary driver. "Even with a 5 trillion yen goal, ($42 billion by 2020), organic growth is good enough from our perspective."
How's it Working for You so Far, Yanai?
Uniqlo opened 62 stores in the first quarter, outside of Japan, bringing the total to 757 stores internationally. At the end of January there were 39 Uniqlo stores in the U.S.- in New York, Boston, LA and San Francisco. The newest one in Chicago will open later this year, and more are planned for Seattle, San Diego and Houston over the next couple years. Remember, with 39 stores out of the starting gate, if they want to reach 1000 stores in the U.S. by 2020, the math says: 200 a year. I think I need to pass along Eddie "abracadabra" Lampert's middle nickname, now better placed as Yanai "abracadabra on steroids" Tadashi.
With 341 stores now in China, which is experiencing an economic slowdown, Mr. Tadashi said, "Some people tend to be worried about the Chinese economy but the economic climate is worse in Japan than China." Okay Yanai, but just what is that supposed to mean? I guess the high is still working.
Even so, if he expects to reach such outrageous goals in such a short period of time, maybe he should try some "speed," which will provide both a euphoric, kind of delusional fantasy, as well as speeding things up, or at least make him think they are moving faster. Again, of course, I have no direct knowledge of these effects.
About the Author
Robin Lewis has over forty years of strategic operating and consulting experience in the retail and related consumer products industries. He has held executive positions at DuPont, VF Corporation, Women's Wear Daily (WWD), and Goldman Sachs, among others, and has consulted for dozens of retail, consumer products and other companies. In addition to his role as CEO and Editorial Director of The Robin Report, he is a professor at the Graduate School of Professional Studies at The Fashion Institute of Technology.