EssilorLuxottica is about to deploy its full-scale vertical-integration business model in Japan. We have learned that the Italo-French group has acquired the business of Washin Optical, a Japanese mid-size optical retailer founded in 1951, through its Luxottica Japan subsidiary. The information has not been officially announced by the group yet, but we were able to confirm at the recent Mido show from different sources that the change of ownership has already been announced internally and externally to Washin Optical’s main Japanese and international eyewear suppliers. The acquisition agreement is currently being reviewed by the Japanese competition watchdog.
While EssilorLuxottica is already operating over 50 stores in Japan under its own banners – Ray-Ban, Oakley, Alain Mikli and Oliver Peoples – the acquisition of Washin marks the group’s first step into the country’s multi-brand optical retail sector. According to its website presentation, Washin Optical directly operates 73 stores in Japan, located for the most part in the region around Tokyo, and one in Tianjin, China.
The company’s retail network also includes 12 franchised shops under the Washin Optical banner as well as a voluntary chain of 138 locations under the Washin Friendshop banner, which is going to be included in the EssilorLuxottica transaction.
The last available figures for the Japanese group show annual revenues of 8,474 million Japanese yen (€53m) for fiscal 2021 and a workforce of 727 employees in February 2022. On its website, the company lists Nikon-Essilor, HOLT Japan, HOYA and Seiko as its main lens partners.
The acquisition of Washin Optical, and its core network of 73 owned stores, remains a relatively small operation for a group like EssilorLuxottica, which operates approximately 18,000 retail locations worldwide, including over 4,000 acquired from GrandVision in 2021. We understand that, with this investment, the group is making a first step in the Japanese retail sector with the objective of gaining insights into the market dynamics before a possible future expansion, whether organic of through more acquisitions. It will be interesting to watch the company roll out its digital strategy and in-store customer experience in a brick-and-mortar market that has remained very traditionnal and largely price-oriented.
Like all consumer markets in Japan, the optical retail market must do with a shrinking customer pool, as the country’s population is declining by about 5 percent every ten years. It remains dominated by low-cost optical retail chains focusing on private-label collections, such as JINS, Zoff and Megane Top. Among the market leaders, Paris Miki, in which EssilorLuxottica owns a 12 percent share, is the main retail group with a multi-brand business model operating in the mid-tier to high-end segment, and approximately 650 doors.
As previously reported, EssilorLuxottica opened a state-of-the-art eyewear factory in Fukui in 2021, following the acquisition of Fukui Megane in 2018.