Core Viewpoint - MUJI is experiencing a store closure trend in China, attributed to operational adjustments and increased competition from local brands, leading to a decline in market share and consumer perception of high prices and low quality [4][11][14]. Group 1: Store Closures - MUJI announced the closure of its store in Beijing's Shimao Gong San mall, effective August 31, 2025, with a notice directing customers to a nearby location for returns [1][3]. - The company has closed multiple stores in 2024, including locations in Beijing, Ningbo, Shanghai, Jinan, and Changsha, indicating a significant contraction in its physical retail presence [11][14]. - As of May 2025, MUJI's net store growth has slowed, with only 16 new openings and 17 closures, marking a record high in store closures [14]. Group 2: Market Competition - The rise of local brands such as Miniso and Netease Yanxuan has intensified competition, offering similar products at significantly lower prices, often one-third to one-half of MUJI's prices [6][7]. - Miniso reported a total of 4,386 stores in mainland China by the end of 2024, showcasing its extensive reach and growth in the market [7]. Group 3: Consumer Perception - Consumers have expressed dissatisfaction with MUJI's pricing strategy, labeling it as "high price, low quality," with complaints about product quality and pricing discrepancies compared to Japan [11][13]. - A significant number of complaints have been filed against MUJI, with over 2,300 reported issues related to product quality by August 2025 [11]. Group 4: Brand Identity and Legal Issues - MUJI is facing a prolonged trademark dispute with Beijing Mian Tian Textile Co., which has affected its brand identity and market positioning in China [8][9]. - The Supreme People's Court upheld Beijing Mian Tian's rights to the "MUJI" trademark in the home textile category, complicating MUJI's branding strategy in the region [9]. Group 5: Future Outlook - Analysts suggest that MUJI must adapt its business model to focus on cost efficiency and quicker fulfillment to remain competitive in the evolving retail landscape [14]. - The company may need to shift from a "large store + heavy experience" model to a "community warehouse + fast fulfillment" approach to sustain its market presence [14].