Daiso Pushing Ahead on U.S. Expansion; 50 of 150 Stores Coming to Texas

DALLAS – Japan-based Daiso Industries Inc., a global leader in private-label products, is planning to develop 50 retail stores in Texas in a bid to build its brand in the U.S., with Dallas/Fort Worth and Houston at the forefront of the rollout. The second 100-yen store has just opened and eight sites currently are under negotiation in the two metropolitan areas.

The second Daiso store, totaling 9,600 sf, opened over the weekend at MacArthur Park, 7505 N. MacArthur Blvd., Irving. The innovative retailer, which adds 1,000 new products each month to its shelves, is focused on leasing sites in grocery-anchored centers with strong national line-ups. Each location is hand-picked by Daiso President Masayoshi Naito and Yoshihide Murata, vice president of Daiso California LLC.

“We chose Texas because it is growing economically,” Murata says, “and the people are especially friendly.”

Although it has 2,800 stores in Japan and 860 in 26 countries, Daiso has been disciplined about its U.S. growth. The first store opened in 2005 in Seattle. The chain now has six stores in Washington and 41 in California. Daiso presently is planning 150 stores in the U.S., of which 50 are ticketed for Texas, and its other new market, Brazil, will be getting 14.

“We are going to build up our brand in Texas and then look for sites on the East Coast,” Murata says. The top picks, at this stage, are New York, New Jersey and Georgia.

Dallas/Fort Worth and Houston are in line for 10 to 12 stores each in the next 18 months, with the balance of the planned openings in the Lone Star State reserved for Austin, San Antonio and other retail hotspots. Heather Nguyen and John Nguyen of Houston-based NewQuest Properties are spearheading the site search in Texas.

Initial sites are being selected in submarkets with large Asian communities, playing off Daiso’s strength as a household name as Japan’s largest retailer, controlling 60% of the 100-yen marketplace worldwide. “In the future, we would like to grow our brand with the general public,” Murata says. “It’s challenging to introduce new products in the U.S. We’re still making changes to adapt to the American marketplace.”

Daiso develops its own products, with the inventory surpassing 90,000 items. The U.S. stores feature 12,000 to 16,000 SKUs. Each store has 30 to 35 employees, with English as the dominant language and products displayed in sleek, highly organized space.

“People come to Daiso for Daiso products that they can’t find anywhere else. These are private-label, high-quality products – not close-outs,” Heather Nguyen stresses. “There were lines outside the stores in Carrollton and Irving before the doors opened on the first days.” The first store in Houston will open in the first quarter.

The NewQuest team is scouting for 10,000- to 12,000-sf spaces in grocery-anchored power centers. “The first stores are important. We’re looking for the right opportunities,” the lead broker adds. “We want to make sure it’s the right location.”

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