2014.4.23
Disclaimer
This Medium-term Management Plan is based on the TSI Group Medium-term Management Plan for the FY2013 to 2015 period released in April 2013.
Although our corporate philosophy and mission as well as the themes of the Medium-term Management Plan have
’ ,
individual group strategies and group growth scenario in consideration of changing the external environment and internal circumstances.
Any forward- ’
judgement made on the basis of the information and data that were obtainable at the time of the creation of this document, and it should be noted that actual results may potentially differ materially from the statements
Form of TSI Group Management
Diversified
business areas
Continuous development and
acquisition of new brands
Establishment of an
optimal business model
Maximum use of group synergy
Management based on the strongest business portfolio
Execute
new market strategies
that were difficult to be implemented by individual companies
Create new values
by combining different brands
Implement of Group Organizational Realignment
Organizational Chart of 2014 Ending Feb.
Organizational Chart from 2015 Ending Feb.
TOKYO STYLE SANEI-
INTERNATIONAL Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ
In operation under a three-tier structure consisting of TSI HOLDINGS
subsidiaries Tokyo Style and SANEI-INTERNATIONAL whose many
subsidiaries are operating under their umbrellas respectively.
Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ Ｘ
Becomes a two-tier structure where almost all of the subsidiaries
turned into direct subsidiaries under TSI HOLDINGS.
Up to 2014
Ending Feb.
Direction of Group Organizational Realignment
Almost all of the subsidiaries are operating directly under TSI HOLDINGS and
the business merger has been truly completed
Completion of
a flexible & speedy organization structure
,
in which the parent company delegates authority,
enabling group companies to utilize their advantages to the full extent
Execution of
the growth strategy that utilizes the resources
of
TSI HOLDINGS (advancement into new domains, major investments,
M&A, etc.)
Promote
inter-group competition
in a positive sense
✔
Roles of group
companies are
clarified
✔
Roles of the
Outline of the Medium-term Management Plan
Improving profitability
→
Implement of investment on growth
Reforming cost structure
Strengthening group management capabilities
✔
Development of new businesses
✔
Expansion of existing businesses
✔
Creation of group synergy
✔
Strengthening of production and logistics functions
Medium-term Management Plan –Improving Profitability-
Development of new businesses
─ Propose new cultures and styles with the themes of clothing, food and housing, unrestricted by apparel ─
Domestic:
Execution of flexible & speedy management decision-making
Overseas:
Expansion of Asian market by overseas subsidiaries
EC:
Promote omni-channeling -> Raise the level of the EC ratio
Improving profitability
Expansion of existing businesses
─ Adopt a two-tier structure, in which we delegate authority to each company
to utilize advantages of each company─
From shopping spaces
to community spaces
-> Produce spaces where people gather
Specific Measures for Improving Profitability
...Also currently seeking to participate in
Participate in space producing
Development of
new businesses
Create consumption by planning/operating a commercial facility ourselves
Produce spaces where people gather
Propose new cultures and styles to consumers
NY contemporary brand Lifestyle select shop
Organic coffee café from LA é
Natural cosmetics from
Scheduled to open
-
, which is a new commercial facility mixing
Development of new businesses
Flexibly utilize the abundance of cash reserves
of TSI HOLDINGS
HOLDINGS takes the lead to implement
the expansion of earning capacity and
exploitation of new domains, which are difficult to be implemented by individual group companies.
Actions
Aiming business domains
■
Select optimal means as
appropriate, such as
M&A and
joint venture
, etc.
■
Expand to business domains that transmit
lifestyles and
Domestic
─
Delegate authority to each company for each company to utilize advantages
─
Expansion of existing businesses
- Execution of flexible & speedy management decision-making
(1) Channel policy according to brand characteristics and change in the consumption trend(2) Diversification of lifestyle
(3) Optimal allocation of investment resources (people, things, spaces) -> Focused investments in profit-making pillars
EC
Overseas
- Promote omni-channeling -> Raise the level of the EC ratio
(1) Establish functioning company, TSI EC Strategies -> Enhancement of EC businesssupport functions
(2) Expansion policy: Promote consumer retention through omni-channeling. Unifying the inventory for stores and EC in order to enable customers to receive products, which
- Expansion of Asian market by overseas subsidiaries
(1) ,
(2) Sales expansion in the Asian market excluding China by TSI Asia Ltd. (Hong Kong)
Improvement of group management functions
-> Establishment of an appropriate governance system
Enhancement of business infrastructure functions and shared functions
-> Strengthening of business follow-ups with subsidiaries
Business infrastructure functions: Production/logistics, store development, business
development, EC support functions, etc.
Shared functions: Finance/accounting, human resources, general affairs functions, etc.
Production/
logistics
Establishment of internal factories and associate factories
Optimization of logistic centers
Overseas Domestic
Share expansion in ASEAN (Thailand, Vietnam (Hanoi), Myanmar, Indonesia,
etc.) and Northeastern China (Dalian, Changchun, and Harbin, etc.)
Development of regions that respond to small lots and medium-scale lots
Establishment of overseas logistics bases
Creation of
group synergy
Strengthening group management capacities
Small but highly skilled work forces in organizations
Reforming cost structure
Reinforcement of management/supervision and monitoring of
companies in the red and newly-established companies
Companies in the red and
newly-established companies
*Two-tiered structure clarifies authority and responsibilities
TSI HOLDINGS
Management/supervision/instruction
Report
Cost reduction through streamlining of shared functions
Turning all group companies into direct subsidiaries through group reorganization
-> Direct implement management/supervision of companies in the red
Swift store scrap & build
Early withdrawal of inefficient brands Report to HOLDINGS as necessary
TSI HOLDINGS Consolidated –Medium-term Financial Objectives-
Achievement of high earning capacity of existing businesses and
expansion of new domains simultaneously
2014 Ending Feb. Result
2015 Ending Feb. Plan
2016 Ending Feb. Target
2017 Ending Feb. Target
Domestic channels 153.8 billion yen 154.6 billion yen 161.1 billion yen 170.6 billion yen EC channels 16.2 billion yen 16.2 billion yen 17.6 billion yen 19.7 billion yen
Overseas channels 11.8 billion yen 10.7 billion yen 11.9 billion yen 12.7 billion yen
Total of existing businesses 181.9 billion yen 181.5 billion yen 190.6 billion yen 203 billion yen
- - 5 - 10 billion yen 10 - 20 billion yen
Total 181.9 billion yen 181.5 billion yen 195.6 - 200.6
billion yen
213 - 223 billion yen
Total of existing businesses -1.1 billion yen 2.5 billion yen 3.5 billion yen 5 billion yen
- - 0.5 - 1 billion yen 1 - 2 billion yen
Total -1.1 billion yen 2.5 billion yen 4 - 4.5 billion yen 6 - 7 billion yen
Development of new businesses (M&A etc.)
Development of new businesses (M&A etc.) Ope r ating
Income N e t Sale s
Delegate authorities/responsibilities to each company -> each company will utilize advantages with the aim of achieving high profitability
Roadmap to Achieve the Plan of Ending February 2017
213 – 223 billion yen
Effective utilization of HD resources
-> Implement with M&A, mergers/collaboration, etc. in perspective
New domains
Always pursue the optimal channel composition, such as EC expansion, etc.
Achieving high profitability through scrap & build
Development of new businesses/withdrawal of inefficient brands
- Rebranding of existing brands
Channel policy
Store policy
Brand policy
Challenging businesses
Each company will aim to improve profitability
’
Effectively utilize (M&A, mergers/collaboration, etc.) HD resources and newly exploit highly New businesses
10 – 20 billion yen Existing businesses
203 billion yen
Existing businesses
5 billion yen
New businesses
HD takes the lead to implement Group companies take
the lead to implement
HD takes the lead to implement Group companies take
the lead to implement Well-performing
businesses
Period ending Feb. 2017 Net sales target
