Is the opening of the first Warsaw Uniqlo the icing on the cake in changing retail trends in Poland?
Uniqlo opens its doors in Poland. Jacek visited the new store in Warsaw and shares his excitement about the potential shift in retail trends the country is experiencing.
2nd November 2022
On Thursday October 27 2022 after a long-awaited move Uniqlo - a Japanese lifestyle fashion retailer opened their doors to Polish customers. This is an interesting move for the this company as on the one hand after having succeeded in Asia and most of Europe (they entered all the largest markets from UK to Russia), Poland seemed like a natural step for their further expansion. On the other hand Poland has been turning discount as I wrote in one of my previous blogs with many big fashion brands leaving the market so Uniqlo success would be halting or reversing this trend. There are more than ten mid-market or lifestyle retail brands including Marks & Spencer, Top Shop, Dorothy Perkins, Cubus, Camaieu, Promod, Salamander, Orsay, Sfera, Gap and American Eagle that left Poland in the last 10 years with COVID being the nail in the coffin for nearly half of them. This has resulted in an increasing number of vacant units in many shopping malls which had to revise their financial forecasts and were forced to accept big hits on their income streams given many of the units were filled with the likes of Pepco, Tedi or KiK who pay low rents. I am constantly shocked when I go shopping to Westfield Arkadia - one of the biggest and best malls in the country and many vacant units are being taken by things like Eurofirany (a curtain shop) or a 2,000 sqm no name pop-up outlet store. Woolworths, a leading German price oriented general merchandise retailer just announced the opening of their first Polish store in Krakow. Uniqlo opening could be the first sign of diversification of the Polish retail scene being strongly dominated by discounters and price focused formats.
Where have Uniqlo opened?
They obviously chose the capital city which is the largest and most affluent market in the country. But where in Warsaw? Well, not in one of the fancy malls which have been mushrooming everywhere since the collapse of communism. They actually chose one of “the used to be an icon” of the communist retail venue called Ściana Wschodnia or Domy Towarowe Centrum (Central Department Store) with their iconic brands such as Wars, Sawa and Junior. It was originally developed in the early 70’s when Poland’s newly appointed communist head of state Mr Edward Gierek started to experiment with the hybrid of communist ideology and capitalist consumerism which hasn’t ended up very successfully but left Warsaw with a retail landmark which has been serving customers still today.
Domy Towarowe Centrum has been through a number of changes since the beginning of the new capitalist Poland. It changed ownership several times and each of the owners had a different idea of what the venue should be. The first one gave it a nice refit and started to sell more fashionable clothing, but it still had a similar set up of an old fashioned department store. Then the next one changed it into an opaque shopping mall. Finally Atrium which is a big landlord of key malls in the country, converted it into and marketed it as a venue for flagship stores of key retail brands. Therefore, we can see adidas accommodating their flagship store for the CEE Region and TK Maxx, Half Price, Zara having their Polish flagships here and now the first Uniqlo.
The place is part of a key retail and leisure destination in Warsaw with big renovation projects under way next door and more development projects in the area to come in the next couple of years. That includes redevelopment of a massive square in front of the iconic Warsaw building, Palac Kultury i Nauki (Palace of Culture), which is going to accommodate a new museum of modern art currently under construction and a lot of new walking space taken from cars, all nicely surrounded by hundreds of newly planted trees and other greenery. This could all be a sign of a new retail phenomenon in Poland that some retail is moving away from fancy multibillion dollar shopping malls into once dilapidated and deserted retail streets. All of course linked to the global trend - switching from cars into public transport and making cities greener, but that’s a subject for another blog.
Uniqlo chose this emerging retail destination to open their first store in Poland. For now they decided that it’s going to be just a pop-up store for one year and if successful they are thinking of an extensive roll out into other retail destinations in Warsaw and expanding beyond the capital into more cities. They took a unit of 800 sqm on 2 floors in Junior – one of the 3 buildings department store with adjacent Wars and Sawa (Wars and Sawa is kind of an acronym of the original name of the city of Warsaw in Polish – Wars-sawa).
Uniqlo Store Layout
The setup is like other Uniqlo stores with 3 sections - men's and women's clothing located on the ground and first floor, and kids’ section taking only the first floor. Their range is also typical with high quality products and LifeWear being a hero category drawing on the values deeply rooted in Japanese culture, such as durability, simplicity, and high quality.
Self-service checkouts are another sign of innovation allowing customers to check out without queuing in a long line - the entire transaction process takes less than a minute and the latter dedicated only to cash payments and returns of the purchased merchandise. This was particularly handy on the opening day with long queues for changing rooms and the standard checkouts.
Judging from how busy the store was on the opening day it gives me confidence that the brand would appeal to the Polish customers and the first Warsaw store would be followed up by other openings in the capital and then move to other large cities in the country. I personally believe this is going to happen, although my opinion is slightly biased as I have been a loyal Uniqlo customer for the last 15 years. I made my first purchase at the Uniqlo’s flagship Shanghai store at Nanjing lu which was a winter coat accompanying me for all these years throughout my travels in eastern Asia and Europe.