In Japan, Fast Fashion Rules in Slow Times

Article Source: time.com
Article by: Coco Masters/TOKYO
PHOTO: Customers shop for clothes at H&M in Tokyo's Ginza district

"Tokyo's Harajuku district is where to find Japan's fashion-forward youth. Every weekend, sidewalks disappear under a frenzy of shoppers looking for new trends. The latest: fast-fashion retailing. During the Golden Week holiday in early May, typically a shopping extravaganza, Los Angeles–based chain Forever 21 debuted its flagship store in Japan. Harajuku girls lined up on five floors full of clothes, shoes and accessories in enough of a dizzying array to make any young woman swoon. It wasn't the first time the giants of cheap chic had stormed Tokyo. Last November about 2,500 shoppers jammed the very same sidewalk for the opening of Swedish H&M, the world's third largest casual-clothing retailer, located next door. And that was just one month after the launch of British retailer Topshop a few stores down. (Read "Japan's New Groove.")

This is the new Harajuku. The once superstylish district is rapidly transforming into an outdoor mall of the titans of casual clothing — H&M, Uniqlo, Topshop, Gap, Zara and now Forever 21 — all competing for wardrobe space within a few hundred meters of one another. Expensive Japanese boutique stores are receding to the backstreets. Retail analysts say that Japanese consumers are continuing to spend in the recession, but have gone considerably down-market to less costly items. As a result, fast fashion "is a hot issue in Japan's fashion industry, especially after the entry of H&M," says Dairo Murata, a retail analyst at Credit Suisse in Tokyo. Luxury-brand sales in Japan are expected to decline 10% in the first half of the year compared with sales in the same period in 2008. (See the world's most influential people in the 2009 TIME 100.)

But though branded luxury may be out, style is still in, and sales at inexpensive fast-fashion and casual-clothing stores have picked up. That's the kind of market that Forever 21 expects will help it reach $2.4 billion in global sales this year, up 40% over 2008's figure. The company thinks that its retail offering, where $100 buys an outfit, a bag, shoes and accessories, fits the Japanese mood right now.

Forever 21 stores are big (they need to be to stock the variety of merchandise they do and to refresh it so often) and big parcels of real estate aren't easy to find in Japanese cities. Forever 21 president Alex Ok said that the search for the site, which at 19,000 sq. ft. (1,800 sq m) is still just one-fifth of the size of a store planned for New York City's Times Square, began a year ago. But he found what he was looking for, and is confident he can tap into the new Japanese frugality. "A Gucci handbag and a Forever 21 top," says Ok. "It's a way for [consumers]] to think, 'I'm smart about how to shop.' "

Forever 21 hopes the new store is just the beginning. The chain now has 460 stores in 13 countries, after launching last year in Thailand, South Korea and China. Lawrence Meyer, Forever 21's executive vice president, says the firm plans to open more than 100 stores in Japan. The recession isn't a deterrent. "Woman always wants to shop," says Wedda Uyeda, an adviser to Forever 21 on the Japanese market. "You want to have the fun of shopping, like in a candy store. I don't think that any of the Japanese companies really realize that." (See pictures of Japanese design's greatest hits.)

Up to a point: Uniqlo, the local entry in the segment, seems to be doing just fine. Tadashi Yanai, a cheap-chic guru and head of Fast Retailing, which owns Uniqlo, is now Japan's richest man, according to Forbes magazine. While most retailers are seeing same-store sales drop between 5% and 15%, Uniqlo's same-store sales rose 2.9% for fiscal year 2008 and 12.9% in the six months to February this year. "Uniqlo is the only big winner so far," says Murata of Credit Suisse, who thinks that for non-Japanese fast-fashion companies such as Forever 21 and H&M to succeed against Uniqlo they will have to pay more attention to quality. But Forever 21's Ok is confident that his brand can grow, and he has the tenor of the times on his side: the soft property market is making it easier to find large retail spaces in metropolitan areas.

Granted, you don't normally associate the word cheap with Japan. But cheap land, cheap chic; something's going on."

--And now I know, why the change the racks EVERY SINGLE WEEK. Amazing.
And that, my friends, is 'fast fashion'.

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