Ito-Yokado gave up on clothing after watching it shrink for 20 years

Ito-Yokado built its general merchandise stores (GMS) around clothing as one of three core categories, alongside food and household goods. That model started failing in the 2000s: apparel sales fell from ¥307.3 billion in 2005 to ¥153.5 billion in 2018, nearly halved in thirteen years, as Uniqlo and other specialty retailers undercut Ito-Yokado on price and quality in the same aisle-by-aisle categories it had always sold.

Ito-Yokado tried to fix the format rather than abandon it, converting apparel lines toward an SPA (manufacture-to-retail) model to compete more directly on cost. The conversion did not reverse the decline. Chain-wide operating revenue, which had run above ¥1.5 trillion in the early 2000s, settled below ¥1 trillion after 2020, and the company posted net losses for two straight fiscal years through February 2022.

On March 9, 2023, Seven & i Holdings announced Ito-Yokado would exit the apparel business entirely and close roughly a fifth of its store count, cutting from 126 stores (February 2023) to 93 by February 2026 — a reduction that reached 33 store closures by the final deadline. The remaining stores would concentrate on food, the one category where Ito-Yokado still competed effectively against convenience stores and supermarkets.

The apparel exit ended a business line the chain had carried since its founding decades earlier as a general merchandise retailer. Seven & i's strategy afterward treated Ito-Yokado as a food-focused format nested inside a group whose profit engine was 7-Eleven convenience stores, rather than as a standalone department-style retailer competing across every category.