The encyclopedia · Strategy & Leadership · Strategic decision · 1973–2021
Inoue's ¥740M Kyoto bag wholesale business closed after 48 years
A Kyoto luggage wholesaler founded in 1973 lost 75% of its revenue when department stores closed during COVID.
Inoue Co., Ltd. · 2021-09-27
What happened
Inoue Co., Ltd. was a Kyoto-based wholesaler of bags and luggage, founded in April 1973 and incorporated in July 1979 with ¥20 million in capital. Located in Fushimi-ku, Kyoto, the company supplied bags, suitcases, and luggage items to department stores and retailers throughout the Kansai region.
COVID-19 devastated Inoue's business model — department stores closed or saw foot traffic collapse, and luggage demand evaporated as international travel ground to a halt. Revenue fell from a peak of approximately ¥2.4 billion to roughly ¥600 million in the fiscal year ending June 2020, a 75% decline.
Unable to sustain further losses, Inoue suspended operations on September 27, 2021, and entered self-bankruptcy proceedings with approximately ¥740 million in liabilities. The operating business was transferred to another company and continues to operate.
Why it happened
- A wholesaler that depends entirely on department stores and luggage demand had no business when both collapsed simultaneously — no stores, no travel, no sales.
- Revenue of ¥2.4 billion fell to ¥600 million in a single year, but the company's cost structure — warehouse, staff, inventory — could not shrink at the same pace.
- With ¥20 million in capital against ¥740 million in debt, Inoue had no financial buffer — the founders could not inject enough capital to bridge a 75% revenue decline.
- The business was sold to another company, proving the operations had value — but the original company's debt load made restructuring impossible.
The lesson
A wholesaler whose survival depends on department store traffic and travel demand is two steps removed from its end customers — when both channels fail simultaneously, there is no fallback.
Aftermath
Inoue Co., Ltd. suspended operations on September 27, 2021, and entered self-bankruptcy proceedings with approximately ¥740 million in liabilities. The company was founded in April 1973 and incorporated in July 1979 with ¥20 million in capital. Its operating business was transferred to another company and continues to operate. Attorney Kazuto Inoue of Tsukasa Law Office was appointed to handle proceedings.
Sources
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