Tadashi Yanai is prone to big thoughts — not surprising for someone who built Fast Retailing Co. Ltd. into a global powerhouse, founded Uniqlo and amassed a $19.5 billion fortune selling LifeWear basics for everybody.
But the 69-year-old corporate chief is now parsing the existential — seeing a kind of fate in Uniqlo’s new collaboration with Alexander Wang, confronting his own mortality with an active succession-planning process, reimagining Western culture through Eastern eyes, and tracking the rise of technology and its impact on the human equation.
Yanai’s mission is to take something simple and make it better, with an eye toward making the world better in the process.
The president, chief executive officer and chairman of Fast Retailing sat down with WWD this week after traveling to Manhattan to help unveil Uniqlo’s collaboration with Wang. The line of innerwear features Wang’s sparse street aesthetic — the all-black T-shirt has a very clean cut and a seam down the middle of the chest — and is wrought in the retailer’s Heattech fabric.
Uniqlo and Wang collaborated before, on dresses for the spring 2008 season, and it worked. Yanai said the looks from the then “up-and-coming young designer…sold extremely well” but that he quickly became “so famous and busy” that there wasn’t another chance to work together until now.
Yanai called Uniqlo’s Heattech “our greatest masterpiece” and is clearly comfortable having Wang’s name and eye associated with the fabric technology, which helps keeps wearers toasty. How long will the association last this time?
“I don’t know to tell the truth,” Yanai said. “But hopefully as long as possible, as far as we find that we win mutually.”
The longer the run, the better the product will become, as the two sides grow more used to working together, he said.
Don’t expect Fast Retailing, which owns Theory and J Brand, to get even closer and invest in Wang, whose company has been rumored for months to be seeking a backer. “No, not at all,” Yanai said when asked about the possibility of taking a stake in Wang.
Such investments in general seem to have lost their appeal. “Unless there is a tremendous cultural fit, I don’t think I’ll be willing to move ahead for any other acquisitions for the time being,” he said. The ceo sees too much organic growth, with Uniqlo getting its footing in the U.S. and eying expansion into India. And he said of the people who own would-be acquisition targets, “I don’t think any of them are serious about divesting their business if they are very hopeful for their future.”
Clearly, Yanai is hopeful about his company’s future.
Part of that has to do with its roots in Japan and the growing importance of Asia. He mused about the collaboration with Wang, who was born in San Francisco of Taiwanese parents, and noted that they both have Asian backgrounds.
“How come?” Yanai wondered. “Well, it could be it just happened. But in my belief…it was meant to happen. It could potentially constitute a great driving force, or conversely, this will further give Alex extra buoyancy or this could be potentially a symbol of this era. Both of us kind of objectively interpreted the Western civilization as part of the Asian people.”
He said that “kind of age,” with a much more Asian accent, might be what comes next.
Yanai pointed to the tract from Japan through China and to India that is home to four billion people as “the potential only growing center and engine of the world. I’m assuming this is the biggest trend.”
To fully capitalize on that trend is a project that will outlast Yanai — and all of the business titans of today. So finding someone to steer the businesses after him is becoming more important. “I need to pick a leader and making that decision will be one of my important works,” Yanai said.
“As soon as possible,” he said with a laugh, showing a spark of good humor that defies the topic, his age and the challenge of his ultimate successor. “I’m not getting tired, but so long as I can continue, I’d like to continue. I need to hand over the control while I’m still up and kicking, making sure I would leave behind no inconveniences.”
Stepping into his shoes will be a big responsibility since the next ceo will have to work across cultures and manage a business where technology and sustainability are becoming all the more important, and retail itself is being reimagined.
“If that person is not able to understand and comprehend [those issues], than he or she is not able to act upon these points,” Yanai said. “I would not expect one person will take over my position. So this is supposed to be a team player, therefore, someone who is able to empower all these other leaders around him or her, make sure that he or she would be a great orchestrator.”
Yanai’s sons, Kazumi and Koji, both serve as group senior vice presidents at Fast Retailing and are set to join the company’s board next month, pending board approval, but the ceo has said the move doesn’t indicate they will take charge of the company.
Fast Retailing’s bottom line expanded by 29.8 percent to 154.81 billion yen last year as sales increased 14.4 percent to 2.13 trillion yen. Yanai is pushing to boost sales to 3 trillion yen.
And with these ambitions, the company is increasingly squaring off with giants, like Amazon Inc. and Walmart Inc. in both the U.S. and in the relatively new frontier of India.
But Yanai said he has different goals.
“I’m sure there are certain impacts and influences,” he said of Walmart, Amazon and the rest. “But the way of thinking for us is different. All these other players are after extra money. But for us, we want to make a difference by introducing products that are made in India and sold in India. We wanted to understand their culture. We wanted to fully control the value chain end-to-end, so we wanted to create an entire spectrum of value chain built in India.”
Both making and selling goods in India will expand the company’s impact on the country and its people, and change how the retailer develops there.
Similarly, in technology, Yanai sees changes that will reverberate strongly in the future. Fast Retailing has teamed with Google to speed up its big data initiatives and is working with material handling firm Daifuku to automate its warehouses.
“Across the world, the labor shortage is a big social problem,” Yanai said. “The simple manual labor that will not require any mind work could be replaced by machines and all the human beings will need to find a better work that will require more thinking…their potential is under-leveraged [currently] so this is an opportunity for all human beings.”
Yanai tends to revert back to speaking about humankind in broader terms. With operations around the world, he gets around, dipping into cultures to try to understand where Uniqlo or one of his other businesses would fit.
“People across the world are different, but they’re all human beings,” he said.
Yanai noted the majority of the human experience — 95 percent — is shared. “But people coming from different cultural backgrounds, they all point to the remaining 5 percent,” he said. “I’m finding that very odd.”
Is that a comment on President Trump and his us-versus-them mentality? “I am politely refraining myself from making any comment on this,” Yanai demurred.