Back to first principles: the “Re-Born” plan and recovery from three years of decline (2021)

A turnaround that consisted of putting things back

What makes this recovery unusual is that the prescription for the crisis was not to add something new but to put back what had been given up. The tidying and range-cutting of the “2016 format” that had produced record profit looked like a rational improvement — the floor was easier to read — but it was eating the depth of assortment that was Shimamura’s strength, and with it the fun of hunting for a find. What Suzuki addressed first was not a novel picture of growth but the company’s own core: restore the range that had been thinned, and shift from dependence on markdowns back toward quality. The lesson of the case lies in that reversal — that the decision taken at the very top of the company’s fortunes was what caused the stall that followed.

That said, the recovery cannot be credited to merchandise reform alone. Stay-at-home demand blew a following wind into affordable everyday clothing, and the causes of the rebound are not singular. Even so, Shimamura has spent its history travelling back and forth between quantitative growth — spreading thin and wide — and qualitative growth that deepens what each store holds. It sank under the weight of its own scale when it cut the range, righted itself by returning to first principles, and has now turned the wheel back toward growth in size. The decision keeps putting the same question to the shop floor: where to place your weight, expansion or concentration.