The Nikkei Business magazine featured the retail chain Muji in its March 11 2013 edition in its “Overseas development lessons” series, showing how Muji learnt from its initial failures overseas in the 1990s. The owner of the chain is the company Ryohin Keikaku, and the brand in Japan is known as Mujirushi Ryohin (no brand, quality goods) – so there’s one secret of success already, keep your brand name short and snappy overseas.
Muji has 208 outlets in 23 countries (59 shops in Europe if you include Turkey). It has developed a rigorous checklist for deciding whether a location is suitable for a retail shop, trying to predict the likely sales volume before signing the contract. It also continually adapts its manual (known as Mujigram) for each country rather than trying to translate the Japanese version exactly. Judging by the extract shown in the article, they’re not afraid of International English either – it may not be elegant or grammatical, but it gets the point across:
1. Are you handling products and a basket with both hands?
2. After scan items, put them left side of the counter
Another learning point is that it has built relationships with suppliers around the world, to design, make and supply its products. However it is trying to rationalise this – the 130 factories making clothes for Muji in 2011 has been reduced to 90, and a further reduction to 70-80 is planned.
In order to deal with complaints that Tokyo HQ staff don’t understand the situation faced in other markets when they issue their demands, from 2011 every manager in the headquarters is sent for a 3 month secondment to an overseas operation. Overseas management track staff are also sent to the Tokyo headquarters for a year and invited to attend management meetings to see Japanese decision making in progress. From 2012, overseas operations are no longer managed separately, but are incorporated into each vertical business unit.
This strong emphasis on personnel, structure and internal communication may be explained by the fact that Muji was turned around from 2000 when its profit and sales started to fall, by Tadamitsu Matsui, who, unusually for a President of a retail company, came from the HR function rather than sales.
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