September 28, 2025

Japan's MUJI apparel company reduces production bases in mainland China

Business News Agency, September 14th – As the demand for service industries in Japan continues to show signs of weakness, Ryohin Keikaku, the operator behind the Muji brand, has announced a major strategic shift by significantly scaling back its production operations in China. The company has revealed plans to cut its 240 contracted manufacturing facilities in China by nearly half over the next two years, aiming to curb rising labor costs and streamline its global supply chain. This move comes amid challenging financial results, with the company reporting a 26% decline in revenue during the first quarter of the year, resulting in a net income of $321,000. Additionally, its stock price dropped by 2.8% in response to the underwhelming performance. Analysts point to the ongoing economic challenges in Japan, where high unemployment rates and shrinking household spending have dampened consumer confidence. Despite some optimism about a potential economic recovery, retail sales remain sluggish, reflecting a cautious outlook among Japanese consumers. This decision by Muji’s parent company underscores the broader trend of multinational firms reassessing their global operations in response to shifting market conditions and rising operational costs. With an increasing focus on efficiency and cost control, Ryohin Keikaku’s restructuring is likely to be closely watched as a sign of how global brands are adapting to the evolving economic landscape.

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