There's been a hiccup in Uniqlo's plan to get half the world wearing its Heattech products — those made from specially developed fabric with warmth-trapping technology — and that's warm weather.
Like many retailers, Japan-based Fast Retailing, Uniqlo's parent company, has lost money due to unseasonably high temperatures in October and November throughout much of the world. But with its overall focus basic, functional, season-specific attire — the stores are a sea of down, fleece and cashmere right now — Uniqlo has seen an especially big impact during its fiscal first quarter, or the three months ending Nov. 30.
In its Japan stores, Uniqlo saw revenue decline 0.7 percent, while operating profit declined 12.4 percent. Internationally, revenue was up 17.2 percent, but profit was down 14.2 percent due to deep discounting of winter merchandise. Sales in China, South Korea and the U.S. were hit particularly hard by the warm weather. Uniqlo also continues to deal with its awareness problem in the U.S. market, which has led to operating losses stateside for the past several quarters, including this one. Its solution has been to limit store openings to big cities like Chicago, Boston and Seattle, while making a big e-commerce push.
On account of this, Fast Retailing cut its operating profit forecast for fiscal 2016 by 10 percent to 180 billion yen ($1.5 billion). As for how the company will make up for its weather problem, CFO Takeshi Okazaki said during a briefing in Tokyo that it plans to put its spring collection in stores sooner and introduce products that are less "weather-sensitive," according to Bloomberg. An interesting strategy, as it seemingly banks on spring arriving sooner even though, for many of us, winter seems to have come later.
In related news, now's the time to get your Heattech and ultra light down, as a lot of it is currently on sale.