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Text｜He Zhexin

Editor: Qiao Qian

More than a week has passed since the incident, and Yangshan is still replaying the scene frame by frame.

She saw a dress at a Uniqlo store near her home, priced at 299, a designer model. "I thought it would be on sale sooner or later, so I put it back." A passing clerk suddenly turned to her and said that this was a new designer model and would not be on sale.

"To be honest, I was a little embarrassed at the time," Yangshan told 36Kr afterwards. Should he ask back, "Will there never be a discount?" or admit that it was a bit embarrassing to wait for a price cut? Yangshan was unsure.

She shared this experience on Xiaohongshu, and some netizens responded that the clerk might indeed be stating the facts, "No matter what style, there will be a discount, but the discount on designer styles is much smaller now."

More and more people are finding that Uniqlo has become more expensive.

The base shirts that used to cost 79 or 99 yuan are now almost impossible to find, and clothes under 200 yuan are only available in discount areas. Instead, there are more down jackets that cost 699, 799, or even 1,299 yuan. Quick-drying T-shirts that everyone needs in summer can now be sold at Uniqlo for 149 yuan. "Find a purchasing agent, you can buy a dozen of CK short-sleeved shirts at this price," said Yang Shan.

How much more expensive has Uniqlo become? It is difficult to find specific public figures because its Japanese parent company has always denied raising prices in the Chinese market. What consumers can feel is that the discounts are actually getting smaller, which we confirmed last September from Uniqlo insiders.

"Uniqlo's prices used to be very transparent, and discounts were very regular," said Zigo, a long-time member of the Douban Uniqlo group and a die-hard fan. "There were regular, step-by-step price cuts, as well as larger, limited-time specials. It was also easy to find guides online, and the official account also had relevant notifications."

Zigo told 36Kr that it is very difficult to get discounts at Uniqlo now. After finally getting a good price, the price goes back up without you noticing. "It's very insincere."

It has to be said that Uniqlo’s price increase strategy did work at the beginning.

In the first 12 months of August 31, 2023, Uniqlo's global revenue and profit increased significantly. The same is true for the Chinese market, with revenue increasing by 15% and profits increasing by 25%. Analysts said that although it was related to the low base of the previous year, price increases were also part of the driving force for gross profit. Even Fast Retailing CFO Ken Okazaki said proudly, "Even with price increases, our sales can still grow."

But soon, consumers began to stop paying.

In the first three months of this year, Uniqlo's same-store sales and profits in the Chinese mainland market declined. Entering the spring, Uniqlo's performance has not improved, and the profits and earnings in the mainland and Hong Kong markets have fallen sharply. The overall performance growth in Greater China is entirely contributed by Taiwan.

In its reply to 36Kr, Uniqlo expects that its revenue and profits in the mainland market will drop significantly in the second half of the year, and that it will have to wait until the "next cycle" to resume growth.

It’s not that consumers are not buying anymore, they just no longer buy Uniqlo.

In China, the big brand "substitute" Uniqlo has met the fate of being "substituted". "DT Business Observation" once did a statistical analysis and found that almost all of Uniqlo's popular items can be bought on Pinduoduo and 1688 for less than a hundred yuan. Among them are dumpling bags, polar fleece zipper jackets, designer collaboration series polar fleece hooded patchwork jackets, etc.

On Xiaohongshu, posts about "Uniqlo alternative brands" are everywhere. Many posts also list the names of factories, with one headline saying, "You can take it back to Uniqlo for a refund."

Uniqlo's best-selling item this year is a 99-yuan straight-shoulder T-shirt. An e-commerce clothing staff member told 36Kr that such a T-shirt can be easily found on e-commerce platforms for 40 to 50 yuan, and "the quality may be better than Uniqlo's."

In a recent briefing by UNIQLO Greater China CEO Pan Ning, UNIQLO acknowledged for the first time that the "substitute" consumption trend has had a significant impact on the company.

In the European and American markets, it is common to hear complaints that Uniqlo is becoming more expensive and offering fewer discounts.

On Reddit, a Canadian user said that flannel shirts that used to cost 19.9 or 24.9 Canadian dollars now cost 40 Canadian dollars. An Australian user gave an even more shocking comparison: a men's cotton T-shirt that cost only 9.9 Australian dollars three years ago has now risen to 24.9 Australian dollars.

In the comment section, many netizens who were discouraged by Uniqlo’s price increase turned to brands such as MUJI and L L.Bean, which were once considered expensive but are now “more cost-effective.”

"The rise of fast fashion itself is the result of global division of labor and cooperation," Lim, an analyst who has been observing fast fashion for a long time, told 36Kr. "It takes at least half a year to a year for traditional clothing companies to plan and launch products and start selling them. Zara has compressed this process into a few months, and SHEIN can already do it in weeks."

Lim believes that although Uniqlo is different from general fast fashion in terms of style and design, it is still essentially the same, using cost advantages to produce cheap and good products. "After the price increase, consumers who pursue absolute quality will choose other brands, and consumers who value cost performance more will turn to e-commerce."

In a period when consumption is generally downgraded and consumer companies mostly choose to cut prices, is Uniqlo's strategy of raising prices against the trend too risky? Now, it seems to be aware of the problem.

"Original price 49 yuan, new price 39". Recently, many stores have added such signs to emphasize that it is an adjustment of the original price rather than a discount.

Uniqlo raised prices twice in 2014 and 2015, during which same-store sales increased, but customer traffic decreased significantly. Yanai Tadashi rushed to make up for the loss by reducing prices by 30%, but consumers "did not feel that it was cheaper", so the effect was minimal and the financial report continued to decline. In fiscal 2016, Uniqlo's global profits fell by 22.6%.

Uniqlo is a company that grew up during Japan's economic recession. It may be time to return to its tradition and think seriously about how to deal with consumers' increasingly tight wallets.