Uniqlo Binjari Kkwaechan Tojong SPA

48 Store Closures After Boycott
10 More Stores Closing in February
Domestic TopTen and SPAO Sales Soar

[Asia Economy Reporter Seungjin Lee] As the boycott of Japanese products continues to impact, Uniqlo's presence is shrinking, leading to rapid growth of domestic SPA (brands that produce and distribute products independently) brands.

48 Stores Closed Since ‘No Japan’ Movement

According to the fashion industry on the 3rd, Uniqlo will close a total of 10 stores this month alone. First, all stores in Homeplus nationwide will be withdrawn as of the 18th of this month. On the 19th and 25th, operations at Lotte Department Store Sangin Branch and Gwangju Branch will end. These are locations experiencing severe sales declines or where store contracts have expired.

Notably, on the 31st of last month, the Myeongdong Central Store, which was the world’s second-largest flagship store and symbolized Uniqlo domestically, was closed. At the time of the Myeongdong Central Store opening, Tadashi Yanai, founder of Uniqlo and chairman of Fast Retailing, had pledged to achieve 300 stores and 3 trillion KRW in sales by 2020, goals that now seem unattainable.

Before the boycott of Japanese products spread, Uniqlo had 191 stores. However, as sales sharply declined, the company began restructuring underperforming stores, reducing the number to 175 as of June last year. After this round of store restructuring, only 143 stores will remain.

On the 31st of last month, a notice of business closure was posted at the Uniqlo Myeongdong Central Store in Jung-gu, Seoul. The flagship store, Uniqlo Myeongdong Central, will cease operations and close on this day due to the impact on the Myeongdong commercial district caused by the No Japan movement and COVID-19. Photo by Kim Hyun-min kimhyun81@

In 2015, consumers lined up outside the Myeongdong Central Store to purchase the 'Uniqlo and Lemaire' collaboration collection.

Domestic SPA Brands Benefit

From September 2018 to August 2019, before the boycott began, Uniqlo’s sales reached 1.378 trillion KRW, making it the undisputed number one in the domestic SPA market. However, from September 2019 to August 2020, as the boycott intensified, sales halved to 629.7 billion KRW.

The gap was filled by Shinseong Tongsang’s ‘Topten’ and E-Land Group’s ‘Spao’. Topten’s sales in 2019 were 340 billion KRW, but in 2020, they increased by about 30% to approximately 430 billion KRW. Spao’s sales last year were 330 billion KRW, up about 10 billion KRW from the previous year. Despite the fashion industry struggling due to COVID-19, both companies grew, benefiting from the spillover effect of Uniqlo’s decline.

In particular, Topten actively launched aggressive strategies such as recruiting actress Lee Na-young, who was previously a Uniqlo model, and opening stores in locations where Uniqlo withdrew. E-Land also sold off its women’s wear division and expanded investment in Spao.

Fashion Industry: "Uniqlo’s Recovery Will Be Difficult"

The fashion industry believes that Uniqlo’s sales recovery will not be easy. A fashion industry insider said, "Uniqlo used to have a strong loyal customer base, but it has been significantly weakened by the boycott of Japanese products," adding, "SPA brand products are not expensive, so consumers can easily choose other brands, and domestic brands are strengthening online strategies targeting the MZ generation (Millennials + Generation Z), which will further narrow Uniqlo’s position."

This content was produced with the assistance of AI translation services.