■Business Overview

1. Sales composition ratio by business and item

Kawabe ＜8123＞ is mainly a personal goods business that sells handkerchiefs, scarves and mufflers, towels, miscellaneous goods, etc., and is also developing a fragrance business that sells perfumes, etc. The sales composition ratio by business for the fiscal year ending 2024/3 was 84.0% for the personal goods business and 16.0% for the fragrance business. Looking at trends over the past 5 fiscal years (fiscal year ending 2020/3 to 2024/3), the sales structure ratio by business has been trending at over 80% for the personal goods business, over 10% for the fragrance business, the sales structure ratio by item is over 60% for the main handkerchief, around 10% for scarves and scarves, and over 10% for fragrances. Overall, in the fiscal year ending 2021/3 and the 2022/3 fiscal year, sales fell due to the effects of the COVID-19 pandemic, and ordinary losses were recorded, but after the fiscal year ending 2023/3, the company's sales also showed a recovery trend due to a recovery in human flow, and ordinary profit was also on a surplus trend. Also, improving profitability was an issue in the fragrance business even before the COVID-19 pandemic, but strong sales of “CREED,” which began selling in 2023/8, contributed to a surplus in the 2024/3 fiscal year.

2. Net sales composition ratio by market

By market channel, it mainly sells to mass retailers, specialty stores, retail stores, wholesale businesses, etc. with a focus on department stores. They also retail sell miscellaneous goods and fragrances at directly managed retail stores. The sales composition ratio for the 2024/3 fiscal year was 43.6% for department stores, 14.8% for mass retailers, and 41.6% for specialty stores, retail stores, and others (including for wholesalers).

Looking at changes in sales composition ratios by market channel for the past 5 fiscal years, department stores have generally remained in the middle of the 40% range. Until the 2021/3 fiscal year, there was a downward trend due to a decrease in sales floor area due to the closure of stores centered on regional department stores and the effects of the COVID-19 pandemic, etc., but after the 2022/3 fiscal year, the composition ratio began to rise as the flow of people to department stores recovered. The department store sales channel captures consumer needs and consumption trends, and continuously reviews and replaces brand licenses. Mass retailers generally remained in the middle of the 10% range, but the 2024/3 fiscal year fell 2.1 points from the previous fiscal year. There is a possibility that the composition ratio will decline in the future due to the closure of some major domestic mass retailers and the trend of shrinking the clothing and personal goods section area.

The composition ratio of specialty stores, retail stores, and others is generally hovering around 40%. New market development is continuously promoted, and since transactions with major foreign-affiliated mass retailers are on an expanding trend, there is a possibility that the sales structure ratio will rise in the future. Also, as a directly managed retail business, there are 13 stores directly managed by the personal goods business “Players Jiyugaoka” and 8 directly managed stores in the fragrance business as of the end of the 2024/3 fiscal year. “Players Jiyugaoka” has enhanced the assortment of products other than bags, and the lineup centered on highly scarce Maison brands has been strengthened at stores directly managed by the fragrance business. In EC sales, sales content, including fragrances, is being expanded, and an increase in customer attraction and sales linked to SNS is being promoted.

Furthermore, in the future, the policy is to promote the development of new retail shops that combine personal items and fragrances. The exhibition “2024 Autumn & Winter Collection I found something good” held in 2024/5. Then, the company proposed a new sustainable concept shop “Colorless Colors Green” unique to the company as a challenge in its 101st year since the company was founded. In addition to providing consumers with a more attractive shopping experience, we aim to increase profits by increasing the value of the entire fashion and miscellaneous goods section, such as stimulating gift demand with original gift boxes in various combinations.

3. Main brands we handle

The company mainly focuses on famous overseas brands, but it is also strengthening the introduction of new brands and S&B (scrap and build) in response to changes in consumption trends, and planning, development, and sales expansion of its own original brands that respond to diversification of consumer needs.

As the main brands in the personal goods business, handkerchiefs include “POLO RALPH LAUREN (Polo Ralph Lauren),” “LANVIN COLLECTION (Lanvin Collection),” “LANVIN EN Bleu (Lanvin on Blue),” “PEANUTS (Peanuts),” “JILL STUART (JILL STUART),” and “Vivienne Westwood (Vivienne West) There are “WOOD),” “Nicolai Bergmann (Nicolai Bergman),” “KATE SPADE NEW YORK (KATE SPADE NEW YORK),” and “DORAEMON (Doraemon).” Scarves and scarves include our own brand “NATURAL BASIC (natural basic)” and our own brand “Felice Regalo (Felice Regalo).” As for miscellaneous goods and others, the bag house brand “Mother's Bag” is the main product of the directly managed retail store “Players Jiyugaoka.”

In the fragrance business, Maison brands such as “Miller Harris (Miller Harris)” and “ACQUA DI PARMA (Aqua di Parma)” are discovered and actively introduced, with “Salvatore Ferragamo (Salvatore Ferragamo)” etc. as the main force. Import and sale of the Bulgari Parfums Division within Japan began in January 2021. Also, in 2023/7, exclusive import and sales rights for “CREED” were acquired within Japan, and sales began in 2023/8.

(Author: FISCO Visiting Analyst Masashi Mizuta Exhibition)