Mash Style Lab: fastest growing fashion retailer slows down

Mash Holdings has been the fastest growing fashion retailer for the last two years, and has ambitious plans to expand further both at home and overseas. However, while it will double store openings this financial year, it expects sales to rise just 20%, not bad, but half the growth rates of 2012 and 2013.

Japan’s fastest growing fashion and lifestyle retailer, Mash Holdings, saw same store sales at its fashion division rise 13% for the year ending August 2014. Mash Style Lab, which runs chains such as Snidel and and Gelato Pique, reported overall sales up 27% to just under ¥25 billion. By brand, Snidel rose 27% to ¥9.5 billion and Gelato Pique 17% to ¥9.7 billion, but the smaller Fray I.D. chain led growth, up 56% overall and 35% on a like for like basis to ¥3.1 billion. The Lily Brown chain rose 10% to ¥2.4 billion. However, Mash says it faced tough trading at its Snidel chain over Spring/Summer due to a shift to more street casual fashions – Snidel’s popularity has been based on what it calls ‘Street Formal’ fashions.

Overall Mash Holdings saw sales rise 41% to ¥42.8 billion in FY2013 compared to growth of 48.3% the year before. Overseas sales accounted for ¥9.3 billion, a rise of 86%. Last year Mash made its first acquisition, buying womenswear chain FurFur, which helped lift sales, but the double digit increase in same store sales in a financial year that included five months of trading post sales tax hike, demonstrated the business’s momentum.

However, this year it expects sales growth to slow, forecasting sales of ¥52 billion for the year ending August 2015, a rise of 20%.

Although overall sales growth is expected to slow, Mash Holdings plans to greatly increase the rate of store expansion, both at home and overseas. 47 stores will be opened this Autumn/Winter alone, double the number last year. The most emphasis will be on the new chain, Mila Owen, which was launched last Spring. Mila Owen will see 12 new stores this year, adding to three stores each for Snidel, Fray I.D. and Lily Brown, and four for Cosme Kitchen, Mash’s successful natural cosmetics chain. The first overseas store for Mila Owen opened in Shanghai in August, just six months after launch in Japan, a reflection of Mash’s determination to make the chain a beachhead in overseas markets, both in Asia and Europe. Mila Owen is being targeted at ‘urban mothers’ and 30s career women.

New store sales suggest promising growth ahead and it could be that Mash’s forecasts are conservative – although it does say it won’t look to expand the core Snidel and Gelato Pique chains much beyond their current levels within Japan. First day sales for the new Mila Owen store in Lucua in Osaka hit ¥4.2 million, and for the first month’s trading, ¥45 million.

Mash is also diversifying into restaurants, opening Organic Market Kitchen in Parco Nagoya this month complete with organic supermarket.