Aiming to achieve Challenge2025, our New Set of Mid-term Goals
During our 16th Term (FYE January 2020), we were promoted to the First Section of the Tokyo Stock Exchange. I would like to express my sincerest gratitude to all our shareholders and the many other concerned parties, without whose warm support and guidance this would not have been possible.
When setting the tone for the year ahead at the beginning of the term, we announced that this would be the “year of moving to the next stage.” After all, this was the year in which we as a company were re-listed from Tokyo Stock Exchange Mothers to the First Section of the Tokyo Stock Exchange. What is more, everyone in the company united in a bid to achieve our Mission. As part of this drive, we have redefined the concepts of “Mission,” “Vision” and “Value,” and are working to bolster our strengths as an organization.
As BUYMA, we undertook a range of new initiatives in terms of marketing, convenience and product lineup. And in our services, too, I believe that this was a year in which we were able to evolve to the next stage.
In the case of marketing, we have started putting our automation tools into operation. Our efforts are already starting to take effect, allowing us to deliver data-driven and personalized measures to users in an efficient manner. Also, in respect to convenience, the accuracy of our recommendation and search functions has improved, and our owned media such as STYLE HAUS has expanded, enabling customers to discover an even greater range of products than ever. And when it comes to our product lineup itself, in accordance with our “Specialty” Marketplace strategy, this was a year which saw us open up our corporate tools to sellers, enabling us to provide an even more diverse lineup of products from around the world and take our services to the next level.
In addition, ALL-IN, our purchasing service for unwanted items, has gained recognition as a convenient service that allows people to get rid of their used goods simply and without the hassle of having to list items or deal with buyers. Because of this, applications through this service increased by over 1.5 times compared with the previous year. Furthermore, we are also making orderly investments in Global BUYMA and BUYMA TRAVEL, our new businesses.
In the case of Global BUYMA, targeting the North America market, we reorganized our team by appointing human resources with a proven track record overseas. Among other things, we have elicited the services of designers from overseas to update the service’s design and draw up brand guidance, and are appointing non-Japanese personal shoppers in an effort to enable our North America-oriented team to take totally new approaches.
We released the PC version of BUYMA Travel, which had its grand opening. COVID-19 continues to cause turmoil around the world, and until things settle down, we will use this time as kind of preparatory period, during which we will work to improve our products in anticipation of brighter days ahead. We will continue working with the conviction that the time will be right to grow strong when normality returns to the travel market.
As a result of the above, we achieved record highs in our existing businesses in terms of trading volume, sales and operating profit, and ARPU was at its highest amount since our listing. What is more, as we continued to make orderly investments in new businesses, our operating profit ratio exceeded 44%, and we also maintained a high level of profitability in terms of ROE, in excess of 28%. In this term, we drew up Challenge2025, our new set of 5-year mid-term goals. Here, I will give you a sense of the main directions we are seeking to take. In the case of BUYMA, on the supply side, based on our “Specialty” Marketplace strategy, we will work to empower our sellers, improve the ratio of companies on board, such as overseas brand shops, and bolster our categories to give a sense of “Specialty” in fields outside of fashion, too. On the demand side, in order to increase LTV among customers, we will utilize data analysis and AI to efficiently improve the effects of advertising fees and increase the number of purchases. In addition, having already put in place the framework for M&A, this is something we will be giving serious consideration from the current period. This would mean a policy of speeding up the aforementioned BUYMA stimulus measures through M&A. Of course, we will give full consideration to M&A or alliances if we encounter a business in a new growth field in which there is scope to put our core competencies to good use. Through the above, we will aim to achieve the following by FYE January 2025:
(1) Operating profit of 5 billion yen
(2) 5-year total operating CF of 15 billion yen or more
(3) 5-year average ROE of 25% or more
We will prioritize investments in growth (including M&A) as allocation for operating CF of 15 billion yen. However, in the event we have room to spare following these investments, we will decide on the level of dividend payout while striking a balance with our internal reserves.
To all shareholders, I hope you will continue to give enigmo your warm encouragement over the long term, for which I ask for your ongoing understanding and support.
Shokei Suda, CEO