Japan’s Uniqlo takes plunge in uncertain India retail market

Tadashi Yanai, founder and president of Japanese retail giant Uniqlo, speaks during the opening of the company's first Indian store in New Delhi. (AFP)
Updated 04 October 2019

Japan’s Uniqlo takes plunge in uncertain India retail market

  • The Uniqlo outlet, one of more than 2,000 across the world, is spread over 3,250 square meters
  • However, India is notorious for its price-sensitive consumers

NEW DELHI: Japanese clothing giant Uniqlo on Friday opened its first store in India, one of its largest worldwide, becoming the latest global retailer to plunge into the huge but tough developing market.
The South Asian nation, with its 1.3 billion population and a burgeoning middle-class, is viewed by global brands as a major prize but weak consumer demand has hit the economy in recent months.
The Uniqlo outlet, one of more than 2,000 across the world, is spread over 3,250 square meters — and almost next to global rival Sweden’s H&M in an upmarket mall in New Delhi.
“I’m not worried,” the billionaire founder of Uniqlo’s operator Fast Retailing, Tadashi Yanai, said Thursday ahead of the opening, the first of three planned in and around the Indian capital.
“Fast Retailing has long wished to open stores in India, in view of the tremendous potential of a nation of 1.3 billion people ... (with) an average age of 27,” he added in a speech.
Uniqlo is among more than 300 international fashion brands expected to open stores in India in the next two years, according to a November report by consultancy McKinsey and the Business of Fashion trade publication.
McKinsey said that the vast nation’s apparel market was forecast to be worth $59.3 billion in 2022, making it the sixth-largest in the world.
However, India is notorious for its price-sensitive consumers, while ethnic wear still infuses much of local fashion, particularly among women.
Uniqlo is attempting to address the second point by including for the Indian market a “Kurta collection” created in collaboration with an Indian designer.
But on price, Uniqlo so far appears to be selling its clothing at similar levels as in the United States and Australia, and more expensive than in Malaysia.
One signature item, a women’s ultralight down vest for women, retails at 3,490 rupees ($49.10) compared to $49.90 in the US and 149.90 ringgit ($35.80) in Malaysia.
“India is a highly competitive market, and a lot of global brands are already here, along with many successful home-grown brands,” Edelweiss Securities analyst Abneesh Roy told The Print news website.
“Uniqlo is definitely entering late, and it will not be easy.”
On Friday around 500 shoppers of a mix of ages queued up to enter the new store when it opened, with Yanai there to welcome them.

Dubai counts on pent-up demand for tourism return

Updated 11 July 2020

Dubai counts on pent-up demand for tourism return

DUBAI: After a painful four-month tourism shutdown that ended this week, Dubai is betting pent-up demand will see the industry quickly bounce back, billing itself as a safe destination with the resources to ward off coronavirus.

The emirate, which had more than 16.7 million visitors last year, opened its doors to tourists despite global travel restrictions and the onset of the scorching Gulf summer in the hopes the sector will reboot before high season begins in the last quarter of 2020.

Embarking from Emirates flights, where cabin crew work in gowns and face shields, the first visitors arrived on Tuesday to be greeted by temperature checks and nasal swabs, in a city better known for skyscrapers, luxury resorts and over-the-top attractions.

Tourism chief Helal Al-Marri said that people may still be reluctant to travel right now, but that data shows they are already looking at destinations and preparing to come out of their shells.

“When you look at the indicators, and who is trying to buy travel, 10 weeks ago, six weeks ago and today look extremely different,” he said in an interview.

“People were worried (but) people today are really searching heavily for their next holiday and that is a very positive sign and I see a very strong comeback.”

The crisis crushed Dubai’s goal to push arrivals to 20 million this year and forced flag carrier Emirates, the largest airline in the Middle East, to cut its sprawling network and lay off an undisclosed number of staff.

But Al-Marri, director-general of Dubai’s Department of Tourism and Commerce Marketing, said that unlike the gloom after the 2008 global financial crisis, the downturn is a one-off “shock event.”

“Once we do get to the other side, as we start to talk about next year and later on, we see very much a quick uptick. Because once things normalize, people will go back to travel again,” he said.

The reopening comes as the UAE battles stubbornly high coronavirus infection rates that have climbed to more than 53,500 with 328 deaths.

And as swathes of the world emerge from lockdown, for many travelers their holiday wish lists have shifted from free breakfasts and room upgrades to more pressing issues like hotel sanitation and hospital capacity.

With its advanced medical facilities and infrastructure, Dubai is betting it will be an attractive option for tourists.

“The first thing I’m thinking is — how is the health-care system, do they have it under control? Do I trust the government there?” Al-Marri said. “Yes they expect the airline to have precautionary measures, they expect it at the airport. But are they going to a city where everything from the taxi, to the restaurant, to the mall, to the beach has these measures in place?”

Tourists arriving in Dubai are required to present a negative test result taken within four days of the flight. If not, they can take the test on arrival, but must self-isolate until they receive the all-clear.

While social distancing and face masks are widely enforced, many restaurants and attractions have reopened with business as usual, even if wait staff wear protective gear and menus have been replaced with QR codes.

“When it comes to Dubai, I think it’s really great to see the fun returning to the city. As you’ve seen, everything’s opened up,” Al-Marri said.