MARUI CO., LTD.

etirement benefits to employees transferred to Group
companies and special termination benefits paid to
employees opting for voluntary retirement. Overall, we
anticipate that personnel expenses will decrease and
profitability will improve significantly going forward as a
result of the Group’s reorganization. However, lowering
wages is not the main aim of these reforms. Rather, we
are seeking to raise the quality of employees’ work and to
facilitate growth of the Marui Group.
Further, in order to put our reforms on track as soon as
possible, we have launched a strategy of aggressive investment
in television commercials and other advertising—an
area in which, over the past decade, we have been gradually
reducing spending. This advertising strategy aims to
increase customer visits by reinforcing the Marui brand
and the image of Marui stores.
Also, we are taking steps to reduce assets in a bid to
improve capital efficiency. For example, in conjunction
with the shift to Group management, Marui sold head
office buildings that are used by the parent company and
its subsidiaries to subsidiary AIM Create Co., Ltd. As a
result, the Company recorded a valuation loss of ¥14.0
billion and lowered assets. We expect that those measures,
combined with the impact of reducing the reserve
for payment of severance and retirement benefits, will
result in consolidated total assets contracting approximately
¥60.0 billion.
STRATEGY 3
WITHDRAWING FROM UNPROFITABLE STORES
AND LINEUPS TO BOOST EARNINGS
As part of the reform of our management organization, we
will actively scrap existing stores that have become
uncompetitive. In January 2004, we closed three stores
and two buildings, including stores in Tsuchiura, Hachioji,
and Kawaguchi. In our view, continuing operations at
those stores would not regain the support of customers.
We felt that because of changes in the stores’ commercial
districts and such considerations as fixtures and the scale
of the stores it would have been difficult to enhance competitiveness.
Also,
we timed these closures
to coincide
with the opening of
our large-scale store
in Kitasenju. Given
that scrapping lowprofit
stores is essential
in the creation of
a highly profitable
store network, we intend to continue implementing closures.
In line with this strategy, Marui will close its
Numazu store in May 2004. Further, we have withdrawn
from our low-profit electric appliance retail operations
and converted related sales areas to operations centered
on cell phone retailing. For Marui stores in which
we think electric appliances are needed, we have consigned
those operations to electric appliance general
merchandising stores.
STORE AND BUILDING CLOSURES
Tsuchiura Store
Hachioji Store
Kawaguchi Store
in The Room Jiyugaoka
Marui One Shibuya
Numazu Store
Date of Closure
January 2004
January 2004
January 2004
January 2004
January 2004
May 2004
Sales Floor Space
4,774m 2
11,797m 2
6,299m 2
1,724m 2
5,980m 2
3,868m 2
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