RYOHIN KEIKAKU CO., LTD.

Information Resources

Financial InformationNon-Financial Information

MUJI REPORT

Information on medium- to long-term value creation

Securities Report (Japanese only)

Sustainability (website)

Consolidated Financial Results

https://ryohin-keikaku.jp/eng/sustainability/

Investor Relations (website)

https://ryohin-keikaku.jp/eng/ir/

Contents

Introduction

Our Philosophy

3

Our History

5

Our Products

7

The Ryohin Keikaku Group in Numbers

9

Global Network

11

Enhancing Our Corporate

Taking on the Challenge of "Public Interest

Value

and People-Centered Management"

13

The Value We Create

15

Message from the President

17

Our Goals and How We Will Achieve Them

23

Business Strategy

Medium-term Business Plan

25

Product Strategy

A Lineup of Products That Are a Part of

Sustainability Strategy

  1. Build a sustainable society while achieving circularity, and coexisting with nature
  2. Revitalize communities and resolve their issues through localization activities

Four Indices

55

Ryohin Keikaku and Sustainability

57

Environmental Management

59

Resource Recycling

59

Water Resources

62

Biodiversity

63

Chemical Management

64

Climate Change

65

Sustainable Community Design

67

People's Daily Necessities

27

Ryohin Keikaku's Unique Product

Development

29

Apparel

31

Household Goods

33

Food

35

Procurement and Production

37

Raw Material Procurement

39

Store Strategy

Community-Based Business Model

41

Initiatives to Take Root in Local Society

43

Global Strategy

Overseas Business Expansion

45

Initiatives in Our Mainland China Business

47

Human Resource

Human Capital Strategy

49

Strategy

Human Resource Development Policy

and Initiatives

51

Business Infrastructure

IT Strategy

53

Editorial Policy

3. Promote high

Human Resources and Labor Practices

69

employee engagement

and acquisition of

problem-solving skills

4. Achieve "public

Initiatives to Realize Co-owned

interest and people-

Management

71

centered management"

Basic Information

Directors and Corporate Auditors

73

Corporate Governance

77

Messages from Outside Officers

81

Compliance

84

Risk Management

85

Financial and Non-Financial Highlights

89

ESG Data

91

11-Year Summary

93

Consolidated Financial Statements

95

Stock Information

99

Corporate Information

100

This report is intended to lead to dialogue with stakeholders by presenting goals for medium- to long-term value creation, management policies, business conditions, and other information based on the philosophy and mission of Ryohin Keikaku, which is aiming to help create "a truthful and sustainable life for all."

Note: In this report, amounts and number of shares that are less than one unit are rounded down, and all ratios and percentages are rounded to the nearest whole number.

Scope of This Report

Consolidated subsidiaries and consolidated companies of Ryohin Keikaku Co., Ltd.

Period Covered

Fiscal year ended August 2022 (September 1, 2021 to August 31, 2022)

Note: Information outside this period is reported when it is appropriate to show past events and data or recent examples.

Forward-Looking Statements

This report contains forward-looking statements and projections. These statements and projections are based on the Company's judgments at the time the report was produced, and include risks and uncertainties. Changes in various factors could cause actual results to differ materially from forward-looking statements and projections contained herein.

MUJI REPORT 2022 2

Introduction

Our Philosophy

Our Corporate Purpose

Our corporate purpose is to contribute to the creation of "a truthful and sustainable life for all" through our products, services, stores and business activities; believing "human society rich in heart, with balanced relationship between human, nature and artifacts."

Our Two Missions

Mission 1: To provide daily necessities and services with genuine quality and ethical value, at appropriate and affordable prices.

Mission 2: To have a positive impact on each region by operating stores that serve as community centers, sharing concerns and values with local residents and collaborating with them to tackle local issues.

Our Core Value

We make efforts to reduce our environmental burden and to respect individual human rights through our product development, services and actions. Through our core value of "contributing to society and people" our employees and associates will proactively respond to issues facing society and the Earth.

Our Management Policy

We will practice "public interest and people-centered management," where each of our employees and associates contribute to the public interest through our business activities and locally rooted stores, have a sense of ownership and take leading roles in the community.

Enhancing Our Corporate Value

Through our activities, we will create a highly profitable business structure, pay taxes properly and return profits to shareholders appropriately. Furthermore, we will strive to create long-term value for the Company by making a positive impact on society together with stakeholders.

MUJI Tsuruya Azumino Hotaka

3 MUJI REPORT 2022

MUJI REPORT 2022 4

Introduction

Our History

In order to realize "a truthful and sustainable life for all," we have a "Grand Strategy" of contributing to society and people. Of course, as a business enterprise, profit is also important for us, but our top priority is this "Grand Strategy." Ryohin Keikaku has been working to make a contribution wherever it can help with social issues and people's concerns. This approach has led to the Ryohin Keikaku of today.

1980-2000

2001-2015

Our Perspective

How things should be

The relationship between daily life and things

We aimed to eliminate waste and create products that are truly

We sought to give customers a feeling of rational satisfaction,

useful to consumers from the perspective of selection of materials,

expressed not with "This is what I really want," but with "This will do."

streamlining of processes and simplification of packaging.

2016-2020

A truthful and sustainable life

By providing functional, streamlined products that help simplify and beautify people's lives with "conscience and creativity," we have contributed to solving social issues with proposals of ideas for peaceful, relaxed living.

2021-

"A truthful and sustainable life for all," and beyond

We offer affordably priced products that are useful and truly essential, in addition to being good for the environment, producers and local communities. We will also evolve our efforts to help solve local issues, and contribute to the harmonious coexistence and development of daily life, culture and the environment together with local communities.

From products to lifestyle options

Hotel

Apparel

Furniture

Household

goods and food

Bicycles

History of Ryohin Keikaku

1980

IDÉE

Campsites

Houses

Apps

Cafe&Meal MUJI

From stores

"Roadside

to local

community

station" outlets

centers

Self-driving

Healthcare

(preventive care

vehicles

and well-being)

Food and

Home renovation

agriculture

Flagship store

Social capital

Culture and

Mobile sales

arts

Seiyu Co., Ltd., a Japanese retail company, established Mujirushi Ryohin (MUJI) as its private brand

1983

First directly managed store,

MUJI Aoyama, opened in

Japan

1986

Production and procurement started outside Japan

1989

Ryohin Keikaku Co., Ltd. established

5 MUJI REPORT 2022

1991

Began business outside Japan (First store in U.K. and first store in Hong Kong opened)

1995

MUJI Tsunan Campsite opened

2000

Listed on the first section of the Tokyo Stock Exchange MUJI.net Co., Ltd. established (currently MUJI HOUSE Co., Ltd.)

2001

MUJI Yurakucho opened

2005

MUJI (Shanghai) Company Limited established

2006

Business transfer from IDÉE Co., Ltd.

2007

First store in U.S. opened

2010

Began MUJI x JICA Project Kyrgyz

2011

Found MUJI Aoyama opened

2012

Muji Retail (Thailand) Co., Ltd. established

2013

Joined UN Global Compact

Launched MUJI passport smartphone app

2014

MUJI Sino-Ocean Taikoo Li Chengdu, the global flagship store in China, opened

2015

Began ReMUJI recycling initiative

2016

Entered the market in India as the first

Fiscal year ended August 31, 2022

Japanese retailer there

Operating revenue

Number of MUJI stores surpassed 400 both

JPY 496.1 billion

2017

in Japan and overseas

2020

2018

Established production management base in Vietnam

Operating profit

Launched MUJI passport Pay service

JPY 32.7 billion

Began sales of frozen food

2021

2019

New start under our "Second Founding"

MUJI Ginza and

Started monthly furniture rental service

MUJI HOTEL GINZA opened

Opened Healthcare Center

Note: The graph in the background shows operating revenue.

6

MUJI REPORT 2022

Introduction

Our Products

Throughout its history, Ryohin Keikaku has tried to help resolve social issues through its products based on the idea of being useful. In doing so, three perspectives in our product development have remained unchanged since the launch of the MUJI brand in 1980: selection of materials, streamlining of processes and simplification of packaging. We develop no-frills, quality products and select materials that take the global environment and producers into consideration, eliminate waste in all processes, and provide customers with what they actually need, in the form they actually want.

1980 to 2021

2022

Three Perspectives

-Our basic approach to product development-

Selection of Materials

We review materials by always returning to the basics of product development that are often overlooked in creating delicious and healthy food, comfortable clothes that fit well, and household goods that put function first. We provide high- quality products at affordable prices by utilizing materials that are rejected despite their quality because of their appearance, using commercial materials, accessing raw materials from global

Apparel

Simplifying Processes

1983: Pre-washed shirts

Since washing clothes changes the texture of the fabric, it was assumed that shirts also had to be starched and ironed before sale. We overturned this conventional wisdom with the launch of pre-washed shirts that make the most of their natural texture. While omitting some processes and reducing costs, we also put effort into selecting materials. Ever since, product styles, materials and production areas have evolved further, undergoing both extensions and subdivisions, according to the times.

Recycling and Effectively Using Resources

2022: Down series made with recycled nylon fabric

We updated our lightweight down apparel by using eco-friendly recycled nylon fabric. Waste threads generated during the production process, which are normally discarded, are collected, washed and crushed. They are then broken down again into nylon thread for recycled nylon products. As part of our efforts to use finite resources without waste and to reduce our environmental impact, we adopted 100% recycled nylon for the inner filling of our lightweight down products.

markets, and procuring large quantities of seasonal goods at low cost.

Streamlining of Processes

We work to improve processes right down to the production of a single product. For example, we eliminate problems associated with sorting and arranging sizes, and we also make products from goods rejected because of nonstandard size or shape. We eliminate unnecessary work. This includes work that is not related to the fundamental quality of the product, such as excluding uneven shapes/colors or polishing. Our approach to developing no-frills, quality products eliminates material waste and reduces costs.

Household goods

Rethinking Functions

1991: Mattress with Legs

Upon hearing that many Japanese people sleep on a futon placed on top of a bed frame, we wondered whether they might also use a mattress without a frame. This simple idea led to the launch of Mattress with Legs, which became a major hit product with total sales easily exceeding 1 million units. Even after its launch, we have continued to refine the product by incorporating customer feedback to make improvements in every aspect, including comfort, durability and price.

Preparing for Natural Disasters and Practical Use

2022: Cardboard beds

Based on the concept of everyday goods that can also be useful in emergencies, we have developed products in response to the opinions of people who have experienced life as evacuees. In collaboration with the Voluntary Architects' Network, a non-profit organization that has been working for many years to improve conditions at evacuation centers, we launched an easy-to-assemble cardboard bed for use in limited space.

Simplification of Packaging

All MUJI products have always appeared in stores featuring only a package or tag simply giving product details. For products that may need extra packaging, we bundle them together or use a common container. We pursue ongoing initiatives to reduce trash because we do not want resources to go to waste.

Food

Investigating the Essence

1980: Koshin Shiitake Mushroom Pieces

Dried shiitake mushrooms have high nutritional value and can be rehydrated for use as a soup stock, but everyone in Japan took it as a given that they were expensive. Our Koshin Shiitake Mushroom Pieces disproved this common belief. The secret of its low price was that MUJI was the first company to omit the sorting process used to standardize sizes and reject broken items. Our ambition to develop a product to "provide customers with the lifestyle essentials they actually need, in the form they actually want," which was printed on the package at the time of the launch, found acceptance among many customers.

Addressing Food Loss

2022: Irregular Baumkuchen series

Some loss inevitably occurs in the manufacturing process. Food may taste the same, but it is discarded because of its appearance. To eliminate this wastefulness, our Irregular Baumkuchen uses the entire cake up to its edges. Some twenty years have passed since the launch of Irregular Baumkuchen, a product that shows our respect for food. With the addition of variations such as a series with chocolate coating, its concept continues to evolve as a confectionery that enriches everyday life.

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Ryohin Keikaku Co. Ltd. published this content on 26 May 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 May 2023 06:07:22 UTC.