Local Japanese store to shut
Print Edition
Japanese department store Takashimaya is pulling out of China citing fierce industrial competition and shifting consumer market trends.
The Osaka-based company will be liquidating its China affiliate and closing its Shanghai store on August 25 after negotiations on rent reduction failed. The decision was made at a Takashimaya board meeting yesterday.
Shanghai Takashimaya’s shareholders will vote on the proposal to dissolve and liquidate the China affiliate on August 25.
According to an official notice on Shanghai Takashimaya Co’s official website yesterday, the future operation of the store would be very hard despite diligence and therefore it was closing the business after entering the China market in December 2012.
The Shanghai store in Changning District has a floor space of about 40,000 square meters and mostly targets well-off Chinese shoppers with luxury items and catering.
“The lack of profitability is largely due to tough competition within the industry coupled with delays and changes in development projects for adjacent commercial facilities, which have been compounded by China’s economic slowdown and falling consumer spending,” it said.
With a registration capital of 490 million yuan (US$71 million), the Shanghai store has been suffering from net losses for the past three years. In the fiscal year ended in February 2019, it reported a net loss of 8.6 million yuan.
The liquidation process under local laws is expected to be completed by 2021.
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