Takashimaya department store drops plan to exit China market
TOKYO, NNA - Major Japanese department store chain Takashimaya Co. has withdrawn a plan to close its only outlet in China after the landlord offered improved business conditions.
In June, Takashimaya announced the Aug. 25 closure of the Shanghai store and liquidation of its Shanghai subsidiary, citing a breakdown in rent reduction negotiations as well as a decline in sales amid fierce competition.
The prospects for profitability have improved now that the landlord has agreed to accommodate a better business environment through talks, a Takashimaya spokeswoman told NNA, adding the company's China business is now expected to move into the black within the next few years.
The Osaka-based department store group has received calls to stay in China from local governments, customers, employees and suppliers, she said.
The store, located in the Changning district, will keep its operation with 40,000 square meters of floor space, although some inconvenience may stem from the initial closure plan, the company said.
Since opening in 2012, the Shanghai store has suffered net losses due to competition from online retailers and other local stores, with sales markedly slowing down after the U.S.-China trade row broke out around a year ago.
Takashimaya placed Vietnam, not China, as its next key profit base after Singapore when it presented its financial results in February. (NNA/Kyodo)