Japanese fashion retailer Uniqlo is deepening its commitment to India, increasing local sourcing for both domestic and international markets. Kenji Inoue, COO and CFO of Uniqlo India revealed that the company is currently sourcing approximately 15.5% of its requirements for Indian stores locally. However, this figure is significantly higher for export markets, and Uniqlo aims to further elevate its sourcing from India in the future.
India has emerged as a strategic sourcing hub for Uniqlo, particularly for items like T-shirts and its popular Heattech clothing line. This strategic move aligns with the brand’s global expansion strategy and leverages India’s growing textile industry.
Inoue highlighted the positive impact of rising income levels in India, enabling consumers to opt for premium fashion brands. This burgeoning middle class, coupled with Uniqlo’s strong brand positioning, has contributed to the company’s impressive 59% CAGR growth over the past five years. India is now considered a market with the highest growth potential, prompting Uniqlo to prioritize its brand presence and customer experience in the country.
While Uniqlo’s initial focus in India was on the Northern region, particularly Delhi-NCR, the retailer is now expanding its footprint to major metropolitan cities like Mumbai. The company is adopting a deliberate approach to expansion, prioritizing product mix and quality over rapid store openings.
Uniqlo India’s financial performance has been robust, with revenue from operations surging 31% year-on-year to Rs 814.8 crore in FY24. Profits also witnessed a significant increase, reaching Rs 85 crore during the same period.
As Uniqlo continues to strengthen its position in India, it faces competition from international brands like Zara and H&M, as well as a growing number of trendy domestic D2C brands. However, the company’s focus on quality, innovation, and a strong brand identity positions it well to capture a significant share of the Indian fashion market.
