Due to a boycott on Japanese goods, Uniqlo’s sales in South Korea have taken a hit. Japan’s decision to tighten controls on exports of materials that South Korea uses to make semiconductors and smart phone displays has prompted a consumer backlash in Korea, with consumers boycotting Japanese products from beer to pens. Japan has also removed South Korea from a list of favored trading partners. Relations between the two US allies are now at their worst in decades. The dispute is rooted in compensation for forced laborers during Japan’s occupation and South Korea has repeatedly invoked its difficult history with Japan, which colonised the Korean peninsula during World War Two. A South Korean court last year ordered Japanese companies to compensate Koreans who were forced to work for Japanese occupiers during World War Two.

Uniqlo has close to 190 stores in South Korea where its sales comprise 6.6 per cent of its revenue. Uniqlo, known for its simple and affordable clothes such as lightweight down jackets, is battling saturation in its main home market, Japan. It could also come under pressure due to a slowdown in China, where it typically logs a major proportion of its growth. Unseasonably warm weather hit sales of winter clothes.