The Yen may have weakened from ¥100 to ¥140 to the Euro but enthusiasm for European brands continues unabated. Yagi Tsusho signed three brands in the last six months, including Kenzo.
Kenzo Paris has signed a joint venture deal with Yagi Tsusho for distribution of the Kenzo brand in Japan. Yagi Tsusho, which has joint ventures with other prominent brands such as Moncler and Henry Cottons, and owns labels like Mackintosh and J&M Davidson, will start distribution from A/W2014.
The joint venture, set up last month in Aoyama, is a 50/50 split with directors from both firms on the board. It replaces an agreement with Bluebell Japan which has distributed the French brand for many years. Kenzo, which is owned by LVMH, appointed Carol Lim and Humberto Leon, the founders of Opening Ceremony, as creative directors in 2011 and since then has gained a new following, and wants to see the same happen in Japan. LVMH accordingly decided to commit to investment in the Japanese market but within the frame of a joint venture with a local firm – Yagi Tsusho‘s existing experience of running joint ventures with overseas brands fitted the bill.
Yagi Tsusho is currently looking to expand its portfolio of European brands further. Last month it signed another French label, Jerôme Dreyfuss, a bag and accessories brand owned by the husband of Isabel Marant. Yagi Tsusho’s subsidiary Splendors & Co, which focuses on premium accessory brands, will start selling the brand from this A/W season with prices of around ¥100,000-180,000. The brand already sells around ¥300 million on a retail base per year in Japan but Yagi Tsusho expects to quickly raise this to ¥1 billion.
Last September it also signed Italian scarf brand Faliero Salti. Salti has been selling its ¥20,000-40,000 scarves in Japan for a good while, with high levels of sales, but lack of control meant the brand was being sold in poorly positioned stores, leading to the tie up with Yagi Tsusho. The trading firm will tighten control of wholesale distribution and set up stand alone stores to tighten up the branding, including a flagship in Aoyama due this Spring and more corners in department stores. It expects to double sales in the next five years.
Toray Diplomode expanding
Another long-established distributor is also expanding. Toray Diplomode, a once sleepy subsidiary of the material giant Toray, says it expects sales to jump 26% in FY2013 and will ramp up expansion further given the positive results of its revitalisation plans to date. The recent growth in sales comes from both new brands as well as much better results from its existing brands, which have benefitted from more investment in stores. Although Toray expects some negative impact from the weak Yen and tax hike, it sees plenty of scope for expansion within what remains a huge market.
In the last year Toray has signed three brands, Vanessa Bruno from Paris, Fleurs de Rhum (it already distributes sister brand Chacok), and Blue Les Copains. Its other brands include Tracy Reese, Vince and U by Ungaro among 11 under management. Vince is now a ¥1.4 billion business after four years with Toray, and saw its first store outside the US opened last October in Tokyo. Toray plans 20 stores and corners within the next three years.
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