The encyclopedia · Strategy & Leadership · Strategic decision · 1965–2021
Sun Jewelry's ¥2.17B accessories chain collapsed with its Harajuku Fancy Pocket store
A character accessories chain with a Harajuku flagship lost 87% of revenue as tax hikes and COVID killed demand for kids' fashion.
Sun Jewelry Co., Ltd. · 2021-08-27
What happened
Sun Jewelry Co., Ltd. was an accessories and character goods retailer founded in 1965 and incorporated in October 1979. Based in Yamanashi Prefecture with ¥20 million in capital, the company operated the 'Fancy Pocket' chain of accessories stores with a flagship location in Harajuku, Tokyo. It also developed its own original character 'Hopped-chan' and sold products through Rakuten, Yahoo!, and Amazon.
The company's decline began after the 2014 consumption tax hike and the rise of non-regular employment reduced children's disposable income and demand for accessories. Revenue peaked at approximately ¥4 billion in fiscal 2013, then fell to ¥2.1 billion by fiscal 2016 as the company closed underperforming stores. A pivot to online sales was not enough to offset the store closures.
By fiscal 2020, revenue had collapsed to approximately ¥500 million — an 87% decline from peak. COVID-19 dealt the final blow, crushing remaining store traffic at a time when the company had no reserves left. Sun Jewelry filed for civil rehabilitation at the Kofu District Court on August 27, 2021, with approximately ¥2.17 billion in liabilities.
Why it happened
- Sun Jewelry sold accessories to children and teens — a market that shrank when consumption tax hikes and the shift to non-regular employment reduced families' discretionary spending on non-essentials.
- Prime locations like Harajuku meant high rent bills that became unsustainable as foot traffic declined — ¥4 billion in revenue could support a flagship store, but ¥500 million could not.
- The pivot to online sales was too slow — by the time Sun Jewelry invested in Rakuten and Amazon, it had already closed most stores and lost the brand presence that drove online discovery.
- With ¥20 million in capital against ¥2.17 billion in debt and annual revenue of just ¥500 million, the company had completely run out of financial runway.
The lesson
A character goods retailer dependent on children's spending has no resilience against tax policy and demographic shifts — when pocket money dries up, the accessories business dries up with it.
Aftermath
Sun Jewelry Co., Ltd. filed for civil rehabilitation at the Kofu District Court on August 27, 2021, with approximately ¥2.17 billion in liabilities. The company had been founded in 1965 and incorporated in October 1979 with ¥20 million in capital. Revenue had declined from a peak of ¥4 billion in fiscal 2013 to approximately ¥500 million by fiscal 2020. Attorney Yoshiaki Miyama was appointed as legal counsel.
Sources
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