House of Rose

Basic Information

Stock Code
7506
Industry
Retail
Category Detail
Daily Necessities & Household Products
Prefecture
Tokyo
Establishment Year
April 1982
Listing Year
August 1996
Official Website
https://www.houseofrose.co.jp/
TSE Information
TSE Information
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Yahoo! Finance
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Overview

House of Rose is a cosmetics retail company founded in 1982, focusing on natural-oriented skincare products with a diverse brand lineup through OEM production and a partnership with Wacoal, establishing a unique market position.

Current Situation

House of Rose recorded net sales of approximately 12.7 billion yen and net assets of approximately 5.5 billion yen in the fiscal year ended March 2020, maintaining a stable financial base. Centering on natural-oriented cosmetics, it leverages domestic sales rights for products from U.S. company Crabtree & Evelyn, offering a variety of OEM products. As a fabless company without its own factories, it differentiates from competitors through efficient product development and a rich product lineup. Through its partnership with Wacoal, it has secured capital support and strengthened distribution channels, selling at directly operated stores and specialty shops nationwide. In recent years, it has focused on improving product quality and enhancing in-store experiences to boost customer satisfaction. Backed by growing demand for natural-oriented products, it aims to expand market share by strengthening collaborations with OEM manufacturers and promoting digital channels. It is also progressively addressing sustainability, aiming to establish a sustainable cosmetics business by 2030.

Trivia

Interesting Facts

  • Pioneer in the cosmetics industry as a fabless company.
  • Holds exclusive domestic sales rights for Crabtree & Evelyn.
  • Possesses solid brand power in the natural cosmetics market over many years.
  • Stable position in the industry due to capital participation from Wacoal Group.
  • Capable of providing diverse products in short periods through unique OEM development.
  • Focuses on strengthening customer touchpoints at directly operated stores with community-based deployment.
  • Long-established company headquartered in Akasaka with numerous stores mainly in Tokyo.
  • Has maintained stable performance by upholding natural-oriented brand stance since founding.
  • Approximately 900 employees, mid-sized cosmetics retailer.
  • Business scope includes related supplements beyond cosmetics.
  • In-store counseling services contribute to customer support.
  • Many OEM manufacturers are domestic, providing strength in quality control.

Hidden Connections

  • Wacoal Holdings has invested about 21% and provides management support.
  • Long-term exclusive sales agreement with U.S. Crabtree & Evelyn.
  • Many OEM partners consist of prominent domestic cosmetics manufacturers.
  • Planning of natural-oriented products collaborates with some specialized research institutions.
  • Main brands gain support from local communities through store deployments.
  • Strongly promotes fabless strategy in the cosmetics industry.
  • Flexibly adjusts store closures in depopulating areas and concentration in urban areas.
  • Product development adopts market-driven approach based on customer surveys and SNS analysis.

Future Outlook

Growth Drivers

  • Expansion of natural and organic cosmetics market
  • Increased demand for anti-aging care products in aging society
  • Growth of EC channels and utilization of digital marketing
  • Spread of personalized products tailored to customer needs
  • Increased demand for ethical products due to rising sustainability awareness
  • Sales channel expansion through strengthened Wacoal Group collaboration
  • Product diversification leveraging domestic sales rights for overseas brands
  • New technology introduction and product development via manufacturing partners
  • Store consolidation in urban areas and experiential store development
  • Expansion of beauty supplement market amid health trends
  • Enhanced corporate value through strengthened social responsibility
  • Business efficiency and customer service improvement via DX promotion

Strategic Goals

  • Achieve net sales over 15 billion yen
  • Realize EC sales ratio of 30% or more domestically and internationally
  • Make 30% of all products organic certified
  • Achieve 50% reduction in CO2 emissions and lower environmental impact
  • Secure 2 billion yen annual sales in new business areas
  • Deepen cooperative relationship with Wacoal Group
  • Achieve 100% sustainable resource procurement
  • Reach 30% ratio of female managers among employees
  • Optimize store numbers and deploy high-experiential value stores
  • Maintain customer satisfaction at 90% or higher

Business Segments

OEM Manufacturing & Supply

Overview
Develops and supplies a wide variety of cosmetics centered on OEM.
Competitiveness
Fabless structure enables diverse product planning and flexible manufacturing partnerships.
Customers
  • Various cosmetics brands
  • Retail chains
  • Specialty stores
  • Mail-order operators
Products
  • Basic skincare
  • Body care products
  • Perfume & fragrance
  • Hair care products
  • Makeup products

Import Sales Agency Business

Overview
Import sales business leveraging exclusive domestic sales rights for overseas brands such as from the U.S.
Competitiveness
Provides high-value products through exclusive sales rights.
Customers
  • Domestic retailers
  • Department stores
  • Specialty stores
Products
  • Crabtree & Evelyn products
  • Overseas natural brands

Store Operation Support

Overview
Provides know-how on store operations to support sales growth.
Competitiveness
Store strategy formulation based on product knowledge and market experience.
Customers
  • Retail chains
  • Franchise stores
Products
  • Store operation consulting
  • Product display & promotion support

Raw Material Procurement

Overview
Procurement business stably supplying high-quality cosmetics raw materials.
Competitiveness
Strong relationships with trusted suppliers.
Customers
  • Cosmetics manufacturers
  • Supplement companies
Products
  • Natural-derived raw materials
  • Functional ingredients

Competitive Advantage

Strengths

  • Rich product lineup specialized in natural cosmetics
  • Low-asset efficiency business model utilizing OEM
  • Partnerships with overseas brands holding domestic sales rights
  • Support from capital and business alliance with Wacoal
  • Strong directly operated store network and sales channels
  • Customer base expansion through diverse brand deployments
  • High customer satisfaction and repeat rate
  • Flexible product planning and market responsiveness
  • Brand recognition in the natural-oriented market
  • Market share secured with extensive product lineup
  • Manufacturing risk reduction through fabless model
  • Stable financial base
  • Accumulated know-how from long industry experience
  • Community-focused store deployment
  • Exclusive brand import sales rights

Competitive Advantages

  • Fabless model enables rapid provision of diverse products
  • Specializes in natural orientation to develop niche markets
  • Partnership with Wacoal complements capital and distribution power
  • Product differentiation through exclusive domestic sales of overseas brands
  • Broad customer acquisition via multi-brand operations not offered by competitors
  • Strengthened customer touchpoints through directly operated stores
  • Cost-efficient production via OEM
  • Enhances customer loyalty with local-oriented services
  • Sales expansion strategy utilizing diverse channels
  • Gains consumer trust through sustainability efforts
  • Improves product appeal with ongoing investment in new product development
  • Store training system based on extensive product knowledge
  • Meets market needs with enriched health-oriented products
  • Enhances brand value through attentive customer service
  • Precise market analysis and response based on sales data

Threats

  • Intense competition with major cosmetics manufacturers
  • Intensifying competition due to increasing entrants in natural market
  • Brand image decline from OEM partner quality issues
  • Sales instability from external factors like COVID-19
  • Delays in responding to rapid changes in consumer preferences
  • Raw material price fluctuation risks
  • Shrinking domestic market due to declining birthrate and aging population
  • Increased production costs from stricter environmental regulations
  • Lagging behind digital shift in sales channels
  • Rising import costs from exchange rate fluctuations
  • Risk of increased medium- to long-term funding costs
  • Stagnant brand awareness growth

Innovations

2024: Strengthening Digital Sales Channels

Overview
Implemented site renewal of EC platform and enhanced SNS-linked marketing.
Impact
EC sales ratio improved by 15%, increased young customers

2023: Expansion of Organic Product Line

Overview
Added 10 new 100% organic certified products.
Impact
Acquired natural-oriented customers and increased repeaters

2022: Introduction of Personalized Skincare Recommendations

Overview
Launched sales of individualized skincare products based on AI analysis.
Impact
Increased sales of high-priced products, acquired new customers

2021: Adoption of Sustainable Packaging

Overview
Began applying recycled material containers to all products.
Impact
Reduced environmental impact and improved consumer favorability

2020: Launch of New Brand 'Floral Rhythm'

Overview
Launched new brand leveraging plant-derived ingredients.
Impact
Expanded brand layers and developed new customer segments

Sustainability

  • Expansion of renewable material usage
  • Promotion of in-house energy-saving activities
  • Planning and sales of ethical products
  • Environmental conservation activities in collaboration with local communities
  • Employee environmental awareness training