Uniqlo eyes retail expansion, 2x growth in local sourcing

Mumbai: Japanese retailer Uniqlo plans to double local sourcing from India, a market which it said is key to the brand's growth trajectory. Expanding local sourcing from the current 15%-16% to 30% in the coming years is the target, said Kenji Inoue, CFO and COO at Uniqlo India which is scouting for more local suppliers.

The strategy fits in well with its widening retail play - a bigger business in the country will also allow it to source more locally. Uniqlo's revenues in India have topped Rs 1,000 crore in FY25 and profits have more than doubled during the period. This comes about six years since the retailer launched its first store in the country.

"The target (30% sourcing) is always as soon as possible ...but it's not so easy to localise. We use certain technology in our products and we need to have a certain scale to make those particular products. We need to make our India business bigger to increase domestic sourcing...we aim to achieve 30% in coming years. This is our commitment," Inoue told TOI in an interview on Monday.

Exports from India still account for a bigger share of Uniqlo's sourcing from the region at this point and even as tariffs roil global markets, India will remain an important global sourcing market for the company, Inoue said, without commenting on how much the brand sources from India for the US or what the sourcing strategy will be amid a looming 50% tariff deadline. "We are monitoring the (broader tariff) situation closely," Inoue said.

As more Indians shop for Uniqlo's premium linen, T-shirts and heattech clothing, the brand is expanding its retail footprint in India by foraying into new markets Bengaluru and Pune. Localising its India portfolio (in terms of styles and colours) to cater to consumers better has helped the brand scale in the market where it competes with a mix of global retailers such as H&M, Zara, Levi's as well as local players and new-age D2C startups.

With store expansion and a strong online play, Uniqlo hopes to touch Rs 3,000 crore in revenues in two to three years. India is yet not that big a market in terms of Uniqlo's global pecking order but is one of the top markets in terms of growth potential, Inoue said. "India will play an important role in Uniqlo's global ambition of achieving 10 trillion yen in sales."

Uniqlo will focus on building upon its growth in existing markets in India rather than rushing to set up stores in every region. "We are still small players in the market and have much space to grow," Inoue added.



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