I would like to express my sincere gratitude to all of our shareholders for your continuing support.

First of all, I would like to extend my deepest sympathy to all shareholders who have been harmed by the spread of COVID-19.

In the fiscal year ending March 2021, in line with the global lifestyle changes triggered by the COVID-19 pandemic, the business environment for both our LOWYA furniture and interior e-commerce business as well as our DOKODEMO cross-border e-commerce platform business improved significantly.

In our mainstay LOWYA business, net sales grew substantially, by 142.3% compared to the previous year, reaching a record high. In addition, thanks to the success of our ongoing efforts to improve the cost ratio and review distribution costs, we were able to achieve significant growth in operating profit, ordinary profit, and current net income.

In order to further expand our scale of business, centering on our LOWYA flagship store, we have been strategically implementing various measures to accelerate growth, including a full renewal of the e-commerce system, improving the user experience by making native mobile applications, strengthening social media marketing, and introducing new products in categories that were under-developed in the past. In addition, although we had focused on developing products under our own private brand, in November 2020 we began handling products under other companies’ brands as a test of a future platform built on our LOWYA flagship store, and access as well as order reception have been steadily growing. We will continue to work to expand the range of products we handle, both by developing new products under our own private brand and by handling products under other companies’ brands.

The progress of e-commerce in the domestic furniture and interior industry has been slower than that of other product categories, with e-commerce market penetration still accounting for only 10% as of 2019. However, as e-commerce accelerates around the world in response to the COVID-19 pandemic, online purchasing is rapidly becoming more common in the industry. With the progress of e-commerce, not only the purchasing process but also distribution itself is now changing, and in our core business of furniture and interior e-commerce, we want to change the state of distribution from the ground up.

Furthermore, with the rapid construction of the metaverse within the next few years as well as the predicted emergence of services that also combine the real and the virtual in the commerce domain, it is assumed that technological innovation will transform the buying experience in the furniture and interior industry, where seeing the actual product has always been important. We have been conducting research and development in the AR/VR field for some time, and will continue to invest aggressively to become a leading company in the furniture and interior industry in the coming metaverse era.

In addition, as mentioned above, the domestic furniture and interior e-commerce market is expected to continue to steadily expand together with technological innovation. On the other hand, in light of issues in Japan such as the declining birthrate and aging population as well as population decline, it will be necessary for management to consider how to capture the growth of other countries with higher GDP growth rates over the medium to long term, rather than being confined to Japan. From this perspective, we launched our DOKODEMO business in 2015, and have continued to invest in it to support the global expansion of Japanese manufacturers and retailers by capturing the high demand for Japanese products, as well as to create the next growth platform for our company itself.

Currently, even though distribution to some regions was suspended due to the impact of the spread of COVID-19, demand for the use of cross-border e-commerce as an alternative to inbound consumption has increased. At the same time, we also increased our advertising expenditures. As a result, the total amount of distribution of the DOKODEMO business for the fiscal year ending March 2021 grew significantly, by 221.7% compared to the previous fiscal year.
We greatly appreciate the continuing understanding and support of our shareholders.

Tomokazu Ukishiro
President and CEO
May 2021