Tadashi Yanai, Japan’s richest man, used advice from management guru Peter Drucker to build his Uniqlo clothing empire. To pull out of a slump that’s hammered profits and shares, the billionaire is revisiting the lessons.
Yanai, 61, founder and president of Fast Retailing, built his estimated $9.2 billion fortune over 26 years, turning his father’s tailor shops into the Uniqlo chain of low-priced casual wear to become Asia’s biggest clothing retailer. Yanai says his success was inspired by Drucker’s management strategies and the idea of "customer creation" with a product that creates demand.
This year, something went wrong with Yanai’s strategy. Fast Retailing’s shares have plunged 26 percent in 2010, sales at stores open more than a year fell 25 percent in September, continuing to slide through November, and the company forecast its first profit decline in four years for the fiscal year ending in August.
"Fast Retailing lost focus on its core products," said Mikihiko Yamato, an analyst at Japaninvest KK in Tokyo. "The company tilted to fashion items that didn’t sell well."
Read the rest of the story: Japan’s richest man revisits lessons by Peter Drucker.