Isetan Mitsukoshi Holdings will close the Chengdu Isetan Mall in Chengdu, Sichuan Province, China, at the end of December. The owners of the land and building have decided to sell the building. Isetan has no relocation plans, and approximately 430 million yen is included in the c

Mitsukoshi Isetan Holdings will close the Chengdu Isetan Mall in Chengdu, Sichuan Province, China, at the end of December. The owners of the land and building have decided to sell the building. Isetan has no relocation plan. As asset impairment losses related to store closures, approximately 430 million yen has been included in the consolidated financial report for fiscal year 2021 (ending March 2022). Employees and other relevant parties have been notified of the decision to close.

Chengdu Isetan is operated by Chengdu Isetan Department Store Co., Ltd., a wholly-owned subsidiary of Mitsukoshi Isetan Holdings. The first store in the department store format was opened in 2007, and the second store in the supermarket format was opened in 2018, selling fresh products and daily groceries. The total store area is approximately 28,000 square meters.

Chengdu Isetan’s performance has maintained an upward trend in 2019 as of the COVID-19 epidemic. However, the recent sales in 2021 are only 8.4 billion yen, a decrease of about 20% from 2019. The operating profit and loss, which shows that the main business is profitable, is a loss of 600 million. JPY.

Mitsukoshi Isetan Holdings closed its Bangkok store in 2020 and its Rome store in 2021, and is withdrawing from overseas businesses one after another. In China, it was planned to open 10 stores by 2014, but due to the impact of anti-Japanese demonstrations and other factors, the business environment deteriorated, and only 5 stores were opened in Shanghai and Tianjin.

Japanese department stores have accelerated their entry into China since the 2000s, but it has not been smooth sailing. Takashimaya also announced in 2019 that it would temporarily close Shanghai Takashimaya, which opened in 2012, due to business difficulties. Later, the store closure plan was canceled because the landlord and others reduced the rent burden. It has been unable to operate for a long time due to the epidemic lockdown.