Japanese underwear manufacturer Wacoal Holdings will boost its overseas business by not only continuing to close loss-making stores in China but also expanding its sportswear product line in countries like the United States where there is growth potential.
According to a report by Nikkei Chinese Network on March 7, Wacoal closed approximately 20 stores in China in the 2024 fiscal year (ending in March 2025), which accounted for about 10% of its total stores in China due to sluggish business in the country. The company plans to continue closing loss-making stores in the upcoming fiscal year.
On the other hand, in countries like the United States, the goal is to expand the sportswear product line with growth potential and increase the brand’s operating income to six times its current level within six years. With sales of higher-priced bras, the company is diversifying and focusing its business further to enhance competitiveness both domestically and internationally.
Wacoal is a multinational company based in Japan that primarily produces and sells women’s lingerie such as bras, and in recent years expanded its product line to include men’s underwear and sportswear.
At Wacoal’s online financial results briefing for the period of April to December 2024, the company revealed the reasons for its poor performance in China.
Wacoal generates 40% of its revenue from overseas markets such as Asia and Europe. Recent financial reports show that performance in China is particularly challenging. The company’s subsidiary, Wacoal China, is projected to have operating income of 6.7 billion yen from April to December 2025, a 12% decrease year-on-year, with an estimated operating loss of 447 million yen (compared to a loss of 269 million yen in the same period last year).
Wacoal Holdings Vice President Akira Miyagi explained the poor performance in China, stating, “Consumer behavior is shifting from high-priced items – where Wacoal has an advantage – to mid to low-priced products.” Acknowledging the economic downturn and escalating trade tensions between China and the U.S., Miyagi added, “There is a lack of clear improvement prospects for the Chinese business.”
To revitalize its business, Wacoal began closing approximately 20 stores in China from the end of the previous fiscal year, reducing the total number of stores in China to around 300. The target for closure is loss-making stores located in department stores and commercial facilities. Regarding future plans, Miyagi mentioned, “We will not stop at 20 stores and will continue to actively close stores.”
In addition, Victoria’s Secret, the largest chain of women’s clothing stores in the United States, closed its largest store in Beijing at the Wangfujing APM shopping center in 2023. Following the outbreak of the pandemic in mainland China in 2020, this upscale lingerie brand announced its withdrawal from the Hong Kong market in June of the same year.