Hong Kong
Japanese furniture company Nitori Holdings plans to open 20 outlets in Hong Kong by 2032, starting with the first such store opening on Friday.
Nitori already holds 75 locations in mainland China, and the company seeks to lift that to 100 outlets by the end of the year. Although China is undergoing a housing slump, “a downturn is an opportunity,” Masanori Takeda, Nitori’s director in charge of global sales promotion, told Nikkei. “Consumers will exhibit stronger preference for affordable products that are of good quality.”
Hong Kong “is a key center for disseminating information to the world, so it’s important to prove that we can succeed in Hong Kong so that we can accelerate store openings overseas,” Takeda said at an event Thursday to mark the opening.
The outlet is the company’s 938th location overall and the 144th overseas.
Located at the MegaBox shopping center in the Kowloon district, the 1,860 sq. meters of floor space at the Hong Kong outlet will house roughly 5,500 items.
Furniture small enough to fit in the cramped apartments typically found in Hong Kong will be on offer. The store will also sell N Cool branded bedding, which makes use of cooling material tailored for Hong Kong’s mainly hot and humid climate.
Nitori manufactures most of its goods in mainland China and in Southeast Asia. The company decided to enter the Hong Kong market, where leases and labor costs are higher, because it has developed a retail and logistics network in southern China that keeps costs down.
In Japan, the weak yen has raised the costs of importing furniture, so Nitori looks to ramp up its offshore business. The company plans to expand overseas stores by 75 locations or more on a net basis. China, including Hong Kong, is expected to play a large role in those efforts.
There has been talk that China will suffer from “Japanification” marked by stalled growth over the long term. But Nitori intends to replicate in China the success realized in Japan during the years of economic malaise.
“Nitori has attained growth during the three-decade stagnation in Japan,” Takeda said.
(Nikkei Asia)
