Koti Grain Fabric,Elastic Koti Grain Fabric,Summer Stretch Pants Cloth,Washable Koti Grain Textile SHAOXING YIXUAN TEXTILE CO.,LTD. , https://www.yixuantextile.com
In recent news, it has been reported that Ryohin Keikaku, the operator of Muji, is planning to significantly cut down its production facilities in China. The company has announced an intention to reduce its 240 manufacturing sites in the country by half within the next two years, aiming to cut labor costs. This decision comes as part of a broader strategy to manage rising operational expenses.
Muji, known for its minimalist design and affordable products, has long relied on Chinese manufacturing. According to available data, 100% of its best-selling knitted fabrics are produced in China, while 70% of its garments are also made there, with the remaining 30% sourced from Japan and other Asian countries. These garments are typically manufactured through OEM (Original Equipment Manufacturer) arrangements.
Industry analysts note that the "Made in China" label in the fashion sector is losing appeal due to rising material and labor costs. Additionally, energy prices have further increased pressure on manufacturers. As a result, many companies are re-evaluating their supply chains.
Despite these challenges, the Chinese market remains crucial for Muji. Analysts highlight that the domestic apparel market is growing rapidly, with total retail sales reaching over 326 billion yuan in 2009. With a per capita income growth rate and increasing consumer spending, the market is expected to expand significantly in the coming years.
However, entering the Chinese market has not been without difficulties. Muji's pricing strategy, which was originally based on affordability, has led to higher retail prices in China due to import duties, shipping, and store rent. For example, a simple pair of socks can cost up to 50 yuan, making it much more expensive than in Japan.
Experts suggest that foreign brands often become perceived as luxury items once they enter the Chinese market. While this can be profitable in the short term, long-term success depends on maintaining affordability, especially given China’s relatively low per capita GDP.
Muji’s parent company has faced its own struggles, including financial losses and eventual acquisition by Walmart. This has impacted the pace of Muji’s international expansion, which has seen both successes and setbacks, including early losses in overseas markets.
Currently, Muji is focusing on improving logistics and reducing costs to make its products more accessible. The company’s chairman for Asia, Matsuki Mujizaki, emphasized the importance of making Muji more affordable for a wider audience.
With the evolving landscape of global manufacturing and shifting consumer preferences, Muji must continue adapting to remain competitive in one of the world’s most dynamic markets.