How Uniqlo Became A Favorite in China

In addition to making popular styles, it's kept quiet about the country's human-rights record

- Daniela Wei and Lisa Du

At first glance, the barriers to Yamaguchi, Japan-based Uniqlo becoming China’s favorite clothing brand look impossibly high. Encouraged by government leaders, Chinese shoppers are growing increasingly nationalistic as political tensions with liberal nations mount. Anti-Japanese sentiment in the country is long-standing and pervasive. And competition from both local and global fashion rivals is only getting fiercer.

Nonetheless, the global retailer known for functional basics such as T-shirts, jeans, and thermal underwear secured 1.4% of China’s hugely fragmented $350 billion apparel market in 2021—a larger share than any other single brand.

Founded by one of Japan’s richest men, Tadashi Yanai, and owned by Fast Retailing Co., Uniqlo has succeeded in China thanks in part to political savvy, smart product strategy, and moving into the market early, analysts say. Other global brands targeting China’s vast pool of increasingly wealthy consumers would do well to examine the Japanese company’s strategy—and to consider its drawbacks.

Relying too heavily on Chinese shoppers remains risky for any foreign brand, and not only because it might put of western consumers who are troubled by the nation’s human-rights record. With President Xi Jinping pushing for more self-sufficiency and tussling with the U.S. and other democratic nations over trade, cybersecurity, and other issues, continued access to the country’s consumers is far from guaranteed.