Japan’s discount-furniture king, Akio Nitori, dubbed the country’s IKEA, now wants to export its success into the region’s largest market: China. Business analyst Shaun Rein doubts whether their Japan success can be copied into China, he tells Bloomberg.
At 73, (owner) Nitori said he’s not ready to retire, but he handed day-to-day control to longtime lieutenant Toshiyuki Shirai while he concentrates on expanding in countries such as China, where he’s opened 11 outlets since 2014 and plans to double that number this year.
“It’s going to be a lot harder than he thinks,” said Shaun Rein, founder of Shanghai-based consultancy China Market Research Group who offers Ikea’s travails as an example of how difficult the market is to crack. Ikea’s stores are packed with people — but they come to take naps on showroom beds and enjoy a bit of free air conditioning, rather than to buy.
For Nitori, the challenge will be building brand cache, Rein said. “You can’t compete on price in China.”
Still, Nitori is betting he can replicate his success in the world’s most populous nation, a market 10 times the size of Japan’s. It’s key to meeting his current 30-year target: 3,000 stores by 2032.
“I’m absolutely confident we’ll make it, as long as you don’t hold me to the deadline,” he said with a laugh. “The demand is endless.”
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