Francfranc — At Home in Hong Kong

Fumio Takashima, president and CEO of the Tokyo-based BALS Corporation, the umbrella company for Francfranc, on the ins and outs of retailing in Hong Kong.

“Everyone has 24 hours a day; it matters to enrich the hours and fill them with happiness,” is BALS Corporation president and CEO Fumio Takashima’s take on Francfranc’s philosophy.

This conviction doesn’t only denote what Francfranc stands for, but it is also the root of the president’s magnetism.

At age 60, he appears unbelievably dashing and swanky, with his sleek blazer and T-shirt look as we meet in his 32nd floor office in a sky-scrapper.

The style-conscious president clearly knows a thing or two about quality living – he is physically active in sports such as triathlons cycling, skiing and jogging; and has an open-space office with a panoramic view over the old Kai Tak Airport.

His workplace is also immaculate. There are very few papers, files or anything else lying around apart from an armoire-looking box carrying a suit (probably for his gala dinner afterwards).

He may not yet be a household name in Hong Kong, but he is a KOL, a frequent guest on TV and an author in Japan, having published two books: “Things I Thought While Running Francfranc” and “Nobody Needs a CEO that Who Never Plays”.

Appearance aside, his fame is due in large part to his spellbinding story of building the BALS empire from scratch.

Not long after graduating from Kansai University with a degree in economics, he worked as a salesman at a furniture manufacturer in his hometown of Fukui Prefecture at age 23.

About 13 years later he founded BALS in 1990, selling furniture and homeware, but it didn’t go well. He then founded Francfranc in 1992 based in Tokyo’s Tennōzu Isle, selling not only furniture, but also sundry items, an innovative retail concept back at that time.

“The name Francfranc is inspired from France, resembling a sense of freedom and internationalism,” he says with an eclectic calm and casual temperament.

Hong Kong people have a long-standing love affair with Japanese design for its soulfulness, Zen-like aura and the balance between looks and function, but merchandise with made-in-Japan labels often have high price tags.
So when Francfranc arrived in 2003 and introduced Hong Kong to a cache of Western-style home products at reasonable and affordable prices, a huge market awaited it.

Though the first shop in Causeway Bay took five years to make a profit, the brand now owns five stores in Hong Kong and some 120 shops in Japan.

Despite withdrawing from Singapore, Shanghai and Seoul, sales in Hong Kong and its homeland Japan saw an uptick in revenue in 2015 by approximately a 10% increase in sales in both markets.

A departure from mainstream Japanese-style designs at the batch of high-end boutiques in town such as Okura, Usagi and the Good Design Store, Francfranc’s wallet-friendly merchandise has adopted an international appeal that caters to the multicultural society of Hong Kong.

“Not many of our products have a distinguished Japanese style; instead, we create products based on local lifestyle and preferences here. Now 10 years on, products in Japan and Hong Kong are increasingly alike.”
Francfranc’s products are known to be bright and vivid, but this has evolved over the course of time.

“There was a time when we focused on red and pink, colours that most appeal to Hongkongers, but this stopped a few years ago in favour of a wider range of colour palettes on our products.”

With the advance of technology, the retail industry is facing a grim test as shoppers are increasingly going online. According to a Nielsen survey, a staggering 88% of local consumers shopped online throughout last year, while one-third of them purchased online within one week. E-tailing has become one of the fastest growing fields among retailers in recent years. And Francfranc is no exception.

“Our online shop kicked off last year,” he says. “However, e-commerce is performing better in Japan than in Hong Kong. Online shopping amounted to less than 10% of our total sales in Japan last year, while it’s just taking off in Hong Kong.

“Hong Kong is relatively smaller and people have the urge for a tactile shopping experience. They prefer making final purchases in-store after researching online. In Japan it is quite the opposite – 60% of online purchases in Japan happen on mobile as shoppers prefer to research offline and then buy online.”

Either way, an e-commerce platform is indispensable in any retail business. He says Francfranc is targeting to achieve 30% to 50% sales from online.

“Starting a business is easy, but to keep the business running for more than 10 years is not; not even 50% of entrepreneurs can achieve that. You have to consistently keep up with the trends and move with the times.”