Company history

Miki Masahiro founded International Trading Corporation in June 1985, at twenty-nine, importing Western casual wear. The following year he noticed young Londoners wearing Hawkins boots, went to the maker in person, inspected the goods on the spot and secured Japanese exclusive rights on the day — for a brand nobody in Japan had heard of. That was the point. Locking up a name before it was known meant competitors could not stock the same product, and it gave him an exclusive purchasing position that would work whether he stayed a wholesaler or came down into retail himself. He accumulated the same kind of rights for Cosby, Vans and others, so that no single brand’s fashion cycle could take the business down with it.

From 1990 he pushed further up the chain, contracting production in Korea, acquiring manufacturing licences and eventually the trademarks themselves — an SPA structure that brought brand, production and pricing under one roof at a time when the Japanese shoe trade did not work that way. Holding the rights had not been enough: the counterparty still set the factory and the cost, and a stronger yen ate the margin. Owning production settled that. In 1993 he cut the Hawkins retail price by 30% and still held a 24% margin.

Then came the lesson. In 1995, on annual profit of about $39.3M (¥4bn), the company spent roughly $42.5M (¥4bn) on a television campaign fronted by Kimura Takuya — more than a year’s earnings. Sales reached ¥26.8 billion in the year to 1996, and the saturation exposure consumed Hawkins demand so fast that the boom burned out and sales fell away behind it. Vertical integration had concentrated making and selling on a single brand, so when the brand cooled the whole company cooled with it. The ceiling of a one-brand wholesale model was now visible, and with it the case for owning the shop floor, where demand could be smoothed rather than spent all at once.

In July 1999 ABC-Mart committed to opening aggressively inside shopping centres. The timing was regulatory: the revision of the Large-Scale Retail Store Law had effectively freed new SC development, and a construction boom led by Aeon Mall was under way. A store network of about twenty urban locations became a national chain opening dozens of stores a year through the 2000s. Mall tenancy suited the company exactly — lower up-front cost than street-front stores, and someone else’s footfall to sell into. Combined with SPA product margins, operating margins held above 10% while the store count climbed, at a time when rivals were still committed to street-front formats.

Capital followed. The company went public over the counter in October 2000, which underwrote the opening pace, and the same year it bought its own building in Ginza 6-chome for a flagship store — a counterweight to mall dependence that gave the brand a premium address, higher price points and a visible standard for merchandising and service across the chain. In 2002 the wholesale parent absorbed the retail subsidiary and took its name: the founding import business, with margins around 25%, was folded into the shop-floor company, completing the switch from wholesale to retail in corporate form as well as in fact.

In 2007 Miki stepped down from every position at the company. His successor, Noguchi Minoru, had joined in 1991 and rose from the floor; he held that customer needs can only be read in the shop, and stood in stores at weekends himself. The model kept running without a change of direction — evidence that what Miki had built was a system rather than a personal touch, driven by head-office data on one side and the feel of the sales floor on the other.

ABC-Mart passed 1,000 stores in Japan in 2019 — roughly forty-eight times the network of twenty years earlier. The growth was as much structural as managerial: the company grew with the shopping-centre market it had chosen to live inside. Its answer to competitors specializing ever more narrowly was to go the other way and widen, through the large-format GRANDSTAGE banner, adding sport and outdoor ranges to casual footwear. A store big enough to sit on a mall’s main concourse could serve a whole family, raising both the customer base and the average sale, and deliberately manufacturing more occasions to buy a product people otherwise replace slowly.

Private label carried the merchandising. Noguchi put own-brand product at about half of sales, run alongside direct dealing with the big international brands, and pushed development toward volume rather than blockbusters — the aim being to land as many small hits as possible. Abroad, the company went first to the country where it already had a supply chain: Korea, where the network passed 300 stores, followed by Taiwan, the United States and Vietnam. In the US it took a different route, acquiring LaCrosse Footwear by tender offer in 2012 for about $137.9M (¥11bn) — bringing in the Danner brand — and White’s Boots in 2014. American wholesale disappointed, and the business was shifted toward e-commerce.

The overseas method has changed since. Rather than buying its way in, ABC-Mart now takes local capital as a partner: after entering Vietnam it moved into the Philippines through a joint venture with SONAK, a distributor strong in sports retail, and opened its first store there — adapting how it sells to the capital and distribution already on the ground instead of transplanting a finished Japanese format. Two structural questions sit under all of it. A store network grown on shopping-centre footfall is exposed the moment that footfall weakens, and new SC development has slowed while e-commerce has not. And the founding family holds roughly seventy per cent of the shares while taking no part in management — an arrangement that leaves executives free to run the business in calm weather, but leaves it unclear who decides if the existing model ever stops working and small improvements are no longer enough.