Strategi Anti-Trend UNIQLO Bikin ZARA Tekuk Lutut

Recently, many retail fashion stores have been down. But Uniqlo has continued to increase its number of stores. That makes Fast Retailing as a Uniqlo stock company has a valuation of US$105 billion per March 2021. And for the first time, it can reach Zara's valuation. Meanwhile, the value of the Uniqlo brand jumped from US$8.1 billion in 2018 to around US$13 billion.

Wow, what innovations have made Uniqlo so popular in the midst of the tight competition of the fashion industry? How did Uniqlo build its positioning? Let's take a look at the answer.

We started this story with the birth of Uniqlo as a retail fashion company, which was then continued by following the business strategy they applied. Then, more deeply, we discussed how Uniqlo optimized technology support, and then we understood the challenges and problems they faced. Finally, as usual, we will study important lessons from the journey of Uniqlo business.

In 1949, a Japanese man named Hitoshi Iyanai founded a simple clothing store called Ogori Soji. In his business journey, Hitoshi then involved his son Tadashi Iyanai to lead the Ogori Soji journey. Then Tadashi changed Ogori Soji from a clothing store to a unisex fashion store called Unique Clothing Warehouse.

The change made Tadashi's store attract more attention from consumers because it offered a variety of women's and men's clothing choices. Later, Tadashi then realized that the unique clothing warehouse brand was too long and hard to remember. In fact, he understood that a brand must be simple and attractive. So in 1988, Tadashi decided to change the unique clothing warehouse to Uni-Clothing.

Clo, using C. Uni-Clo. Uniclo. Funnily enough, when the brand was just registered, there was a typo. So, C became Q. So, the writing is not Uni-Clo, but Uni-Clo. But the typo was accepted. There was someone who thought the name Uni-Clo was more unique and more attractive.

So the Uniqlo brand was actually created from a mistake. Three years ago, in 1991, Tadashi launched Fast Retailing as a Uniqlo subsidiary. Until one day, Uniqlo made a big market because they launched a fleece synthetic sweater for 1,900 Yen.

The consumer response was amazing because the sweater was sold for up to 2 million likes. And that's what brought Uniqlo to its peak popularity. So they were willing to open branches in various countries, including Indonesia. But what's called business is indeed fluctuation. And that's what Uniqlo experienced in the early 2000s. Sales at that time dropped to some of their stores in England, especially, had to be closed.

The situation did not make them give up, but instead provoked Uniqlo to continue innovating on their products. Until then, they finally produced the Hit Tech series in 2003 and Aeirism in 2009. Then it was proven, the innovations helped Uniqlo to get out of its difficulties and rise to continue growing until it became one of the largest and most successful retail brands in the world.

So far, Uniqlo is known for its product quality, product innovation, and affordable price. All of these are the result of the series of business strategies and competitive strategies that they have implemented. First, in terms of positioning, Uniqlo is unique, right? Wait, where is the uniqueness? It turns out to be like this. Most fashion designers, such as Zara and others, are used to competing to chase and create the latest fashion trend.

Well, Uniqlo didn't follow and they just ignored the trend of fast-changing fashion. They positioned themselves focused on fulfilling the basic consumer needs by producing and selling daily clothes that are easy to wear, long-lasting, and high quality.

They believe that consumers not only consider trends but also the function of the clothes they will wear Therefore, Uniqlo for example, makes anti-sweat, windproof, and also UV protection clothing

In terms of production, Fast Retailing as a unit law applies the vertical integration and strategic partnership strategy with Tori Industries. The strategy has been implemented effectively by Uniqlo by integrating all planning operations, material development operations, marketing, and also sales into one entity called retail manufacture.

With that strategy, they cooperate with Japanese textile suppliers, manufacturing facilities abroad, and also other partners. Another strategy applied is to limit the product variants produced.

Uniclo's product variations are not as much as Zara's product variations. But Uniclo offers a lot of color choices for each product. For example, if we look at Uniclo flagship stores in Tokyo, they offer more than 50 footwear designs so that consumers can find products that suit their preferences.

Next in the price strategy, 28% of Uniqlo products are sold at a price below USD 10 and only about 10% are sold at around USD 50. Now compare with Zara, whose product is bundled with a price above USD 50, it reaches 18%. And the rest are sold at an average of USD 20-40. Other brands such as H&M actually offer products with affordable prices, but the number is not as much as offered by Uniqlo.

Other strategies are implemented by involving customers in every business process, from product planning to sales. Their product planning team researches the market to understand the trend and customer needs that the results are used to direct product development and improvement. Uniqlo also tries to provide a comfortable and pleasant shopping experience for its customers, both when shopping at the store and when shopping online.

The design of the store is intuitive, while the online platform is also designed to make customers easy to shop anytime and anywhere. This is a unique effort to build a strong relationship with the consumer, so that the consumer feels appreciated and understood. If the consumer feels like that, usually with them, they will definitely be loyal and that means a positive reputation for the Uniqlo brand.

In developing their business, of course, Uniqlo not only relies on business strategies that I have just mentioned. They also utilize and rely on quite massive technological advances. That's because Tadashi Yanai said that Uniqlo is not just a clothing brand, but also a technology company. Why did Tadashi say that? That's because Uniqlo utilizes technology in all its operational lines, from the production process to the product sales process in its stores.

With the support of technology, they produce fabric called HeatTech which makes the user feel warmer and there is also Airism, a fabric that is comfortable to wear and the texture is soft. In fact, they also managed to launch a clothing that has protection against the user from UV rays.

And all of the innovative products have been patented so that the advantages of Comptative Uniqlo can still be maintained. Likewise with services throughout the store, we can feel how the technology is present in every detail, starting from modern interior design with bright lighting to the hospitality of the staff in the store. All of that is designed to provide a

They also utilize digital communication and make large investments in the world of e-commerce. What's the point if not to reach a wider market and increase the number of visitors to their website? Another advantage of Uniqlo in using technology is to build big data on a system of availability with the Just-in-Time model.

This model is similar to what is applied in the Toyota production system, so that it allows Uniqlo to minimize waste. Because with Just In Time, they can determine what will be produced, when it is needed, and also how many are needed. They also use advanced technology to analyze the weekly sales pattern in each store and make sure that the availability is always optimal.

This is part of their effort to understand and predict consumer behavior patterns, so that they can increase the efficiency of supply management. In addition, Uniqlo also plans to produce their clothing until next year and has a team that directly handles the problem or answers the quality challenge that the customer asks for.

Like other businesses in general, of course Uniqlo is not free from problems and challenges. One of the problems that struck them was in 2015 in China when there was a suspicion that there was a violation of copyright in the company of the enterer Uniqlo.

Of course, this case became a mess and Uniqlo promised to handle it. But based on the investigation results that were then carried out, it turned out that only some of the problems were handled and unfortunately the violations continued to occur. Uniqlo was also criticized for the poor working conditions in their factories.

Sakom and War on Wand in their report in 2016 mentioned that there were excessive labor, low efforts, dangerous working conditions, and repressive management in their factories in China and Cambodia.

The report of course made many parties concerned about the welfare of workers and the hunting rights in the UNICLO fleet, as well as showing the need for improvements on the situation. Outside of cases that indicate legal, UNICLO must also face various other challenges as it expands to Europe. For example, the challenges of geographical and cultural differences between Japan and countries in Europe.

Uniqlo is challenged to adapt to the existing differences and overcome the emerging logistic problems due to the distance between the central office and its members Not only in Europe, Uniqlo needs to adapt because foreign customers generally need to be educated on unique sales values and Uniqlo business strategy

For example, about the concept of a model that generally follows trends, even though Uniqlo is more focused on products that are not easy to use. Despite facing various challenges and problems that must be faced so far, Uniqlo has managed to reach the 4th place in fashion brands with the largest number of sales. Its position is below Zara, H&M, and Gap.

However, optimist analysts on Uniqlo growth in the future. Analyst Shun Tanaka from SMBC Friend Research Center said that Uniqlo's strategy focused on the Asian market has been successful, even though facing challenges such as rising commodity costs and uncertainty in consumer trust. As a company, fast retailing is also considered to have advantages because it is able to produce high-quality products, high volume, and affordable prices that are suitable for Japanese consumers.

From Uniqlo's story, there are some important lessons that we can learn. First, Uniqlo successfully created competitive advantages by adopting the Blue Ocean strategy.

They take a different approach from the competitors by focusing on customers who need high quality daily products and do not compete to chase the latest fashion trend. In this regard, as entrepreneurs, we are reminded that we must be able to create unique positioning and focus our business on the effort to meet the needs of consumers who are not yet ready.

in the market, with of course providing an interesting added value. Secondly, Uniqlo has taken advantage of the implementation of advanced technologies in various aspects of their business, from manufacturers to customer experience. They have managed to develop textile innovation products such as Hitech and Airism, which provide practical benefits to their customers. In the digital era now, technology can be used to increase operational efficiency, customer experience, and also product development.

So it is important for us to continue to follow the development of technology and explore new ways to use it in our business. Third, Uniqlo successfully implemented a vertical integration strategy by integrating planning, material development, marketing, and sales operations into one entity.

This has made them have greater control over the supply chain and can ensure the quality and smoothness of production. By having full control over production, the company can respond to market changes quickly and at the same time increase the continuity of its business. So, all friends, let's take inspiration from Uniqlo, not to imitate but to contemplate and extract valuable lessons.

In the arena of competition, Uniqlo chooses unique approaches, creating a blue ocean that is far from the price and fashion trends. We are taught that unique positions and care for the needs of consumers can take us further than just chasing trends.

See technology as a tool, not as a threat. In this digital era, Uniqlo has used technology in every aspect of their business, from manufacturing to customer experience. They prove that innovation and efficiency can work together with the presence of technology. So let's go, let's stay at the forefront of technology development, making it our tool in providing better solutions for each of our customers.

Thank you.