Dome Corporation, an exclusive apparel distributor of Under Armour in Japan, has signed an acquisition deal with Japanese general trading company ITOCHU. By utilizing the product development and production networks of ITOCHU’s group companies and suppliers, this partnership will assist Dome’s distribution strategy, strengthen business through expansion, and increase its corporate value by leveraging ITOCHU’s experience and network, says GlobalData, a leading data and analytics company.

With this acquisition, ITOCHU will account for 70% of the issued share while Under Armour will operate 30% of Dome’s share. ITOCHU, which prioritizes the expansion of the sports-related textile business, pursues a larger foothold in the apparel market, which is expected to grow in Japan by acquiring stakes of Dome. The sports culture in Japan is evident from the projected growth of sportswear in the country which is estimated to grow at a CAGR of *8.5% during 2021-2025. According to GlobalData’s Sportswear Survey, Under Armour is the 8^th largest sportswear brand in Japan and accounts for *8.2% of the country’s sports apparel sales as of 2021.

Debalina Banerjee, Retail Analyst at GlobalData, comments: “Though the retailer experienced strong Q4 2021 sales, its penetration is still weak in the APAC countries including Japan. Under Armour is still too dispersed, lacking the discipline of larger companies like Nike and the focus of smaller players like Lululemon. This is the most important issue the company must address in the future if it wants to compete with other labels that appear to be more premium.”

ITOCHU will continue to recognise new trends by looking closely from the perspective of customers, while utilizing its broad expertise and extensive networks to help DOME grow its business and increase its corporate value through distribution of Under Armour.

Banerjee concludes: “Under Armour’s sales have been falling in Japan since 2016 as larger retailers like Nike, Adidas, Mizuno and New Balance have been leveraging their hold on sportswear market in the country. As a result, a change in distribution pattern will be an opportunity for the retailer to expand its business. Under Armour’s athleisure line is a good opportunity for the retailer to grasp the Japanese sportwear market as 56.2%* of respondents buy sportswear in the country for everyday use, according to GlobalData Sportswear Survey 2021.”

*Data taken from GlobalData’s survey of 6,000 APAC consumers, aged 16+ conducted in Q1’ 2021