Products that Bring a Smile to Any Face

One of the biggest macro trends that Japan is currently facing is the demographic decline. This poses a number of challenges for Japanese companies due to the labor crisis and the shrinking domestic market. It is estimated that by 2040, Japan will be short over 10 million workers. How is your company reacting to these challenges, and to what extent do Japanese companies need to look overseas to secure new markets?

Our company has more than 30 years of history, and we have always aimed to sustain it for a century and beyond. Analyzing the target range is important for us. For example, with BRIEFING, our main customers are in their 30s and 50s. In contrast, the main customers of Felisi are in their 40s and 50s, with purchases from those in their 60s. In the future, we will also focus on customers in their 30s.

As you know, Japan has the highest percentage of people aged 60 and over, and household assets are said to amount to JPY 2,000 trillion, which is considerably higher than other nations, although less than the US.

Senior people like these are active in sports such as golf, tennis, and running, as well as activities like travel. Therefore, we will develop travel suitcases and active sportswear for them. We also focus on people in their 20s and 30s, including successful startup founders, corporate managers, creators, and artists, who could be our main customers in the future.

One thing that isn’t declining is the number of tourists visiting Japan annually. It is now estimated that by the end of 2024, as many as 35 million visitors will have come to Japan, with many taking advantage of the weak JPY and tax-free shopping to purchase unique, made-in-Japan products. What are some of the main opportunities you see as a result of these record numbers of inbound tourists? To what extent are you catering your offerings to capture this part of the market?

We don’t see a huge positive impact from inbound tourism; instead, the mindset has shifted to be more global. Our company is focusing on what is referred to as reverse marketing, with an emphasis on outbounds and providing products in local areas such as Taiwan, Hong Kong, Korea, and China. In Taiwan, we have a branch, and our target for our brands is an annual income of JPY 30 million or more. Here, we offer high-end items, meaning we are targeting high-net-worth individuals.

We have not taken any major inbound measures so far; however, we are expanding our business to the global market as well. Following our cross-border e-commerce, which currently offers products in areas such as the USA, Taiwan, Hong Kong, Singapore, and South Korea, we focus on reverse marketing, which actively incorporates direct feedback from customers and uses it to develop our products and services. Although we have also approached the Taiwanese market through our subsidiary in Taiwan, our major customers there are the same as in Japan: individuals with an annual income of at least JPY 30 million.

We have some strategic stores to attract inbound customers, such as those located in Ginza, Roppongi, Fukuoka, and Kumamoto. In Kumamoto, many customers from Taiwan visit our store since the world's largest semiconductor, TSMC's factory, is there. This gives us important knowledge and insight into what items Taiwanese customers really want.

Many shoppers for high-end products look for unique in-store experiences. What can customers expect from your in-store experience?

We are confident that we can provide a brand-new, exciting experience to customers through our store in Korea. Many Koreans are eager to play golf at famous golf courses in Japan and visit frequently. They quickly get to know our brand and love our products because they can immediately recognize the superior quality and functional design compared to other brands. As a result of purchasing golf items, they become interested in our travel bags and backpacks as well. People who buy golf items often also purchase suitcases and other baggage on their way back to Korea. This kind of customer experience fosters brand loyalty and familiarity with our brand. We are convinced that we can always succeed in Korea.

We saw that you have bases in the US, Taiwan, and other countries. Which markets are you focusing your resources on currently?

We have already registered trademarks in 68 countries and regions for our bags, apparel, accessories, and golf-related items, enabling us to distribute our brand globally without any concerns. Therefore, we will accelerate our global expansion, particularly in Asia and the USA, as data shows that many customers from the USA, Taiwan, Hong Kong, Singapore, and South Korea have purchased our products via Global e-commerce.

You mentioned your company’s establishment in 1992, and in a relatively short amount of time, you have managed to grow into a leader in various different fields. What are your core strengths that have allowed you to grow so much in such a relatively short amount of time?

I worked for a famous design firm in Japan as the youngest designer before starting my own business. I was actively involved in apparel and fashion in New York, Paris, and Italy, and launched the BRIEFING brand with a military design in 1998. That was an important starting point for my career. Besides BRIEFING, I also had several other brands at the time.

Maintaining the brand for 30 years is not an extraordinary achievement for me. There are many brands that have continued for centuries, and I deeply respect them and understand how difficult it is to sustain a brand for over 100 years.

Keeping the concept of my brand alive after I am gone is something I constantly think about. Our employees also share this vision of a brand that will endure for a long time.

How is your brand able to compete with large Western historical brands?

We have researched the marketing strategies of major international brands like Nike. They tend to employ a honeycomb style of business enlargement, centering their core business around shoes and expanding into related areas. For example, Nike starts with running shoes and then develops running wear to complement them. Similarly, in the NBA, Nike produces basketball shoes and then expands into various basketball-related apparel. The core products are shoes, which they supplement with products around the shoe theme.

For our brand, luggage is the central concept, and we base several products on luggage. Our company aims to adopt this comprehensive honeycomb approach. By doing so, we hope to achieve our long-term vision of JPY 100 billion in net sales. Currently, we are about to reach JPY 30 billion, with our next target being JPY 50 billion, so we are gradually expanding. We are fortunate not to have any direct competitors for our business, although we do have competitors in each of our different segments.

We have benchmarked the strategy and success of Nike. Their core competence and symbolic product is running shoes, and they expand into adjacent categories like a honeycomb. For instance, they have developed a fashion line focusing on trainers and spiraling into shoe-related businesses, such as running apparel to go with their running shoes. Similarly, they developed the basketball category by starting with shoes and expanding into a range of basketball-related apparel. However, their core and original product remains shoes, complemented by various shoe-themed products.

Applying Nike's success to our brand, bags and luggage are our central concept, and we have developed new categories and items based on it. We have pursued such comprehensive honeycomb merchandising, and we believe we can establish our original business model by achieving it.

Do you have any dates in mind for your next target of JPY 50 billion in net sales?

We have a medium-term management plan to achieve global sales of at least JPY 30 billion over the next five years, and we plan to continue to expand globally.

Your company has also been very active in mergers, acquiring Figo in 2023. What have been some of the main advantages this merger has brought your company? Are you looking for any further M&A activities in the future?

Diversification of the brand lineup is key to the company's overall growth. The Union Gate Group boasts a diverse range of brands within its portfolio, such as BRIEFING, which has roots in the United States; Felisi, a leather bag manufacturer with 50 years of history and tradition in Italy; and FARO, which highlights Japanese craftsmanship and carries on traditional culture. We are also involved in several licensing agreements. Having multiple brands allows us to diversify our customer base.

From our research, we saw that your company also hosts golfing events. What are the main benefits of hosting golfing events? If your current lineup of events is successful, are you planning on hosting more events in the future?

We have offered our guests a more exciting experience based on the BRIEFING brand vision through our event. Only 240 customers, who were lucky to win a lottery, were able to participate in the competition and vie for the championship title. Our goal is to provide a perfect golf experience to our customers based on the athlete brand concept and eventually develop the event into a professional tournament, similar to the PGA Tour.

Our company has also been sponsoring a triathlon event in Hawaii. Athletes of this caliber often play golf or tennis, so we see the potential for BRIEFING to be a part of their lives. By sponsoring and organizing events, we are gaining further exposure and creating more touchpoints with customers.

Before COVID-19, we sponsored the Honolulu Triathlon in Hawaii for many years. We believe the BRIEFING brand is supported by people who work hard and play harder, and it has a high affinity with events attended by professionals who love an active lifestyle.

Imagine that we come back in three years and have this interview all over again. What goals or dreams do you hope to achieve by the time we come back for that new interview?

2028 is significant for our brand as it marks the 30th anniversary of BRIEFING. By that time, we believe our brand will have expanded from Far East Asia to Southeast Asia and North America, gaining support from many customers. Additionally, we will continue to pursue opportunities in the Chinese market, and I look forward to sharing more exciting news with you in the future.

We constantly monitor changes in global trends and aim to deliver the best experience and value to our customers through products and services that are half a step ahead of the times.

For more information, please visit their website at: https://www.uniongategroup.com/