NO-FRILLS fashion. Cheap and cheerful. Call it what you will, Shimamura Co. has a money-making formula for selling clothes in Japan’s moribund economy.

    Growth in operating income at the country’s second-largest clothing chain has outpaced bigger rival Uniqlo-owner, Fast Retailing Co., for the past five quarters. The reason may come down to the 63-year-old retailer’s simple approach.

    Shimamura employs no fashion designers or celebrity models. Most of its 2,000 outlets are in residential neighborhoods, rather than on upscale shopping strips. Its merchandise, including 1,140 yen (US$10) cardigans and 900-yen skinny pants, are mainly sourced from low-cost manufacturers overseas.

    “We don’t gamble, we only go into what we are certain we can win, and do what we understand,” president Masato Nonaka, 56, said at Shimamura’s headquarters in Saitama prefecture, about 20 miles (32 kilometers) north of Tokyo. “That is the fundamental policy of our company.”

    That code has been especially successful in helping the company expand sales in Japan even as household spending fell in 11 of the past 12 months ended September and consumer prices fell for a seventh straight month.

    Revenue increased an average of 6.2 percent the past three quarters, beating the 5.4 percent average of Fast Retailing, whose annual sales are three times larger. The retail giant’s billionaire chairman Tadashi Yanai is pledging a shift to “lowest possible prices” for its Uniqlo casual-wear stores, and has turned to lower-priced brand GU as his company’s second pillar of growth.

    Fast fashion chains that target younger customers are facing challenges in Japan as the population ages, while rising data costs for mobile phone-totting teenagers means they have less money to splurge on fashion, said Nonaka, who has been with Shimamura for more than 30 years. “But a company like us selling goods at low cost is impacted less,” he said.

    Shimamura opened its first Tokyo store in 1978, a quarter century after it started in Saitama prefecture in 1953. The retailer added more stores throughout Japan from 1990 and had 2,000 Shimamura and other branded outlets by the end of 2015.

    The growth has taken Shimamura’s share of Japan’s apparel market to 4 percent, beating World Co. in 2011, but still trailing Fast Retailing’s 12 percent.

    “Fast Retailing is way beyond us, like above the clouds, and we are just an ordinary company,” said Nonaka. “We won’t be able to copy them. We have to operate our own way.” (SD-Agencies)