Lessons From UNIQLO: 10 Steps for Canadian Retailers to Generate $2,000+ per Square Foot

By J.C. Williams Group

On a recent trip to New York we ventured off Fifth Avenue, Madison Avenue, and Soho – to Brooklyn and the Atlantic Terminal Mall on Flatbush Avenue -- not exactly the haute couture centre of the City.

There on the second floor was a Uniqlo store, opened in October of 2013, which was nowhere near as “jazzy” as its Fifth Avenue or Soho older brothers’ (or sisters’) stores. But look beyond all the fancy Christmas stuff of the Manhattan store and you’ll observe a lean-mean-merchandising-machine. This store has to be pushing $2,000 per square foot. And here is why.

1) Choose a Solid Location with Strong Adjacent Tenants: Co-anchor tenants include Target (not a Canadian version), Burlington Coat Factory, DSW Designer Shoe Warehouse, Victoria’s Secret, and 25 national specialty chains. These are located at a major transit junction in central Brooklyn, so lots of shopper traffic.

2) Straight Forward Messages are Best: Shoppers are in a hurry, often confused or conflicted, and need simple choices. Make sure your “theme” messages are easy to comprehend and react to.

  The entrance and store sign are open and inviting.

The entrance and store sign are open and inviting.

  The windows tell the “colour theme” story clearly. Shoppers “get it” in the blink of an eye.

The windows tell the “colour theme” story clearly. Shoppers “get it” in the blink of an eye.

3) The Front 10 Feet Pays the Rent: The “front and forward” space productivity should be three to four times the rest of the store. You cannot generate sensational sales revenue with an artsy-fartsy display or minimal intensity. Good retailers know and practice this. They load up the front with best sellers.

Just look at Uniqlo’s displays with:
1. Sales associates beside each one
2. Bright, colourful product
3. In depth assortment
4. Fantastic prices on cashmere women’s and men’s sweaters! $59.90

4) Backup Feature Item In-depth: Part of Uniqlo’s success is single-focused promotional items featured in limited ranges (huge buying clout). Winter jackets were in big demand at $59.90 and $29.90.

5) In-depth Merchandise Sends a “These Items are Important” Message: “If they have that much of this item – it must be important and popular” is what these walls convey.

6) End-aisles are Great for Add-on Sales of Smaller Accessories: Building high productivity is done using many different merchandising techniques. Every one has to be used. 

7) Make the Store a Merchandising Machine with Lots of Impulse Items: Your store gets to $2,000 a square foot by using every space and idea.

8) What is Your Inventory per Square Foot? All retailers should use this metric to analyse sales trends in departments and classifications. Uniqlo does not shy away from “using the cube” to showcase assortments and build productivity. All these pictured items have in-depth backup right on the fixture.

9) An Efficient Check-out is Essential: While Uniqlo had long lines at the service desk, they moved quickly.

10) Lots of Team MembersWhile almost hidden in the crush of shoppers, there were dozens of uniformed (all in black) staff continuously re-stocking and straightening inventory. This store was managed in an obviously organized and disciplined manner.

Conclusion: Uniqlo’s unique value position is re-enforced by the simplicity of its visual presentation, the commitment to inventory depth, and the efficiency of the shopping experience.

J.C. Williams Group is a well-known, full-service retail and marketing consulting firm. It offers clients practical, creative, and in-depth knowledge of retailing and marketing, including up-to-date know-how and techniques to make retail operations better and more profitable. You can also read their informative blog, Retaileye, here: retaileye.wordpress.com

Today's Retail News From Around The Web: December 29, 2014