Suggestion to MUJI Operation in USA Based on 4P Analysis

Dr. Chung Sulin Lab:Chu QianGeorgia Institute of TechnologyIndustrial Engineering2014 YSEP Spring

MUJI’s stagnant growth in US

In the worst year, 2 US stores= 1 Japanese store

“Ryohin Keikaku Annual Report 2013 Mar 1st- 2014 Feb 28th, Databook”, PRINT, 2014 May 25th,

4P Elements

• Product

• Price

• Place

• Promotion

Overview

• MUJI sells everything you can find in your house

House wareApparelFood

1. Product

広さ :Various categories

深さ :Various choices under each category

1.1 Oversize Apparel

It was unbelievable that at the start of its USA operation, MUJI made such an absurd bet on bigger size, while its opponent GAP didn’t even consider that idea!

2: Price

Ikea has variety of selections, NORDEN, IVAR etc, offered at different price range.A dining table can be as cheap as $29.99

MUJI’s selections are narrow. Price range is also constricted, targeting most affluent customers.A dining table is priced at $399.99

3. Place

In NY, streets are congested, subway is the primary way to go shopping in city center. However, carrying bulk things while using subway is a troubled experience. =>bestseller: stationery

4. Promotion

Incremental shipping cost:Providing no incentive for customers to spend more; nor incentive for people outside NY or California to shop online.

Other Factor: Inventory Control

Employee quote at Glassdoor.com

“Ryohin Keikaku Annual Report 2013 Mar 1st- 2014 Feb 28th, Databook”, PRINT, 2014 May 25th, P13

Other Factor: Logistics

Suggestion

1. divide-and-conquer =>in-depth targeting:

MUJI Clothes, MUJI Boutique, Corner MUJI

2. Adopt the same size system in America as in Japan, while placing more units on M-L sizes

3. Developing IT departments and locating distribution centers over different continents