Message from the President

I would like to thank you, our shareholders, for your exceptional support and patronage.

In the fiscal year ended March 2022, with the expansion of COVID-19 vaccinations and other measures, social and economic activities gradually got back to normal. Even so, since the recovery at stores in urban areas was slow, it was hard to recover the sales to the level we expected at the beginning. We apologize for the great concern we caused by revising our sales estimates.

Although the recovery pace was slower than originally expected, sales are improving step by step. During the second half of the year, the sales of existing physical stores, which had been struggling, marked 113.3% of the same period in the previous year, and is still on a rising trend after April, 2022. We increased the ratio of regular price sales by adjusting inventory and, as a result, the gross margin was improved to 49.9%, 4.7 points up from the previous period, approaching the level of the fiscal year ended March 2020. Our efforts to thoroughly examine unprofitable divisions, stores, and initiatives have also started producing results, and SGA expenses were reduced to 80% compared with the level of the fiscal year ended March 2020. In March 2022, we renewed “UNITED ARROWS ONLINE,” our own online shopping site, and started the OMO* strategy to merge our physical shops and the online shop into one. We are now ready to grow sales and recover profitability.

In our company philosophy, we state that we will “create five values—value for customers, value for employees, value for business partners, value for society, and value for shareholder,” as our commitment to society. This is our basic policy to increase customer satisfaction first, and in the end enhance value for all stakeholders in a balanced manner. We will offer attractive products with wonderful customer service to provide exciting and impressive shopping experiences, and thereby provide enhanced value to customers, and in the end to all stakeholders, including shareholders. This is a matter of course, but it is something that UNITED ARROWS, as a corporate entity, should cherish and never forget.

As society continues to undergo rapid changes, the environment surrounding our company is changing significantly. We cannot let this change negatively affect what we have achieved or cherished so far. UNITED ARROWS LTD. is well established because we have never stopped providing inspiration, no matter what changes we underwent. We should never forget that polishing this well-established strength of our company will open the way to the future. With this in mind, we instituted the management policy for the fiscal year ending March 2023 as “Providing Inspiration—Wonderful Customer Service, Attractive Products, Great Service, Great Products.”

We aim to restore sales at existing stores as a key strategy to provide inspiration. Three initiatives to achieve that goal are 1. Impressive customer service—boosting sales power, 2. Creation of excitement—boosting product appeal, and 3. Taking on the challenge of using new UA—active trial and error. We will brush up our customer service skills to consider customers’ feelings and to touch their hearts, and strengthen our product development capabilities while devoting time and energy into each product to create value that our customers can also evaluate. Rather than stick to our past experiences of success or conventional ideas, we will actively take on challenges to provide new value such as by developing new brands.

Promoting ES, DX, and sustainability are the three base strategies we set to prop up the above mentioned initiatives and to ensure the sustainable development of our company. In the effort to promote ES, we will revise the employee performance review system, provide training, put the right people in the right places to ensure personnel allocation reflecting the orientation and enthusiasm of individual employees, and thereby aim to improve employee satisfaction, which becomes the key to achieve the goal of “Providing Inspiration.” In the effort to promote DX, we will promote OMO, starting with the renewal of UNITED ARROWS ONLINE in March 2022, push ahead with digital transformation of the supply chain, and enhance our marketing capabilities by making full use of digital information. In the effort to promote sustainability, we will propel activities to minimize the disposal of products and decarbonization, respect human rights throughout the supply chain, and promote the active use of environmentally friendly materials. Such efforts will be actively disclosed to win the public over.

We are in a prolonged unforeseeable situation where the internal situation is undergoing changes and there is a rapidly rising inflation. Even under such a situation, our physical shops and online shops are visited by many customers who enjoy fashion. We realized again that being fashionable and shopping makes our customers happy and enriches and energizes their lives no matter what situation they are in. In the fiscal year ending March 2023, our company will focus all of its efforts on providing inspiration, maximizing customer satisfaction, and in the end delivering value to shareholders.

We sincerely ask you, our shareholders, to continue to support the UNITED ARROWS Group.

* Online Merges with Offline: a retail marketing concept which incorporates offline business into online business

June 2022
Yoshinori Matsuzaki
Representative Director, President and CEO