Japanese clothing chain Uniqlo is scaling back its original U.S. expansion plan from 15 to five stores this year.
The decision came after the retailer fell short of its forecasts and its financial loss widened, a problem the company partly blamed on opening 12 U.S. store in 2014, Fortune reported.
Owned by Fast Retailing, the chain opened its first U.S. store in 2006 and at one point hoped for 200 locations by 2020. Today, the apparel retailer has 44 stores in the U.S., with the most successful stores located in cities. In fact, the chain plans to open a new location in downtown Chicago at the end of the month. However, the 36 suburban mall locations are not doing as well.
"The brand penetration in big cities such as New York, San Francisco and Chicago—where we will open a new store—is good, but not in the suburbs," Tadashi Yanai, Fast Retailing's chief executive, said in a conference call, reported Fortune.
Yanai is sending top managers to the U.S. to try and fix the problem, hoping to make Uniqlo the top clothing store in the world.
Trying to catch H&M, the rival chain has opened 25 new U.S. stores thus far this year, bringing the worldwide total to 381 locations. The chain's U.S. sales were up 22 percent in the last nine months.
-See this Fortune article
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