Nitori Holdings plans to open more small-format stores across mainland China, focusing on household items less exposed to the property market downturn, president Toshiyuki Shirai told Nikkei Asia.
The Japanese furniture retailer, whose rivals include Ikea and Japan’s Muji, operates 77 locations on the Chinese mainland, down from a peak of more than 100 as the Covid-19 pandemic and the real estate slump weighed on furniture demand.
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“After slimming down for a while, we are increasing our store openings this year,” Shirai said at the opening ceremony for a new outlet in Hong Kong.
The newly opened 530m² store, Nitori’s fifth in Hong Kong, sits within a shopping centre linked to the suburban Tsing Yi train station and is anticipated to attract commuters.
Nitori had exited weaker-performing sites as shopping centres competed for a smaller group of consumers.
The upcoming small-format outlets will exclude large furniture items, instead concentrating on kitchenware, fitness equipment and home fragrances—categories Shirai noted have performed well.
These smaller stores will target customer segments and locations distinct from Nitori’s larger outlets.
The company intends to use both store formats to strengthen its foothold in mainland China.
New store openings will be clustered in select regions to control transport costs, spanning coastal cities such as Shanghai alongside major inland hubs, including Chongqing and Wuhan.
Currency movements remain a consideration for Nitori given its products are manufactured abroad.
“We’ve already entered into forward exchange contracts in the Y156 range against the dollar until the end of March 2027, so there won’t be a significant impact on our earnings,” Shirai said, noting the company will maintain such contracts, as steady exchange rates support product development.
