Onward : Medium-to Long-Term Management Vision ONWARD VISION 2030

[Delayed] Onward Group

Medium- to Long-Term Management

Vision

ONWARD VISION 2030

April 8, 2021

The Onward Group's Raison D'etre

Enriching and adding color to people's lives while caring for the planet

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Desired Image of the Onward Group: Evolving into a Customer-Centric Company, Making the Best Use of Employees' Diverse Strengths

	Up Until the Present
	Plan	Produce	Sell		stores physical Conventional
Employees/Partners	HR system/organization	Content apparel) (Mainly	Customers
Management
IT	IT	IT
Infrastructure	Infrastructure	Infrastructure
Communication between customers and employees
	tends to be indirect and one-way, resulting in a
widening of the gap between value provided and the
	value that customers are seeking
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		Desired Image
	Planning, Production, Distribution
		Online stores
		オンラインストアMembers
		Customers１
Organization/		Management/
OMO Stores	Financial
HR
		management
		B2B
	Stylists/ Designers/Pattern makers/
		Staff/Partners
Achieve direct and two-way communication between
customers and employees to co-create value
	provided to customers

Growth Roadmap

Sales

	Transforming the		Moving forward with the
	business model		full-blown growth strategy
	(amid COVID-19)		(post-COVID-19)
Lifestyle			300.0	(Billion yen)
Apparel		200.0	100.0	33%
190.5
25%
40.8	21%	50.0
149.7	79%	150.0	200.0	67%
75%

Operating Profit

ROE

FY02/22		FY02/24	FY02/31
			25.0	(Billion yen)
		7.0	15.0	60%
3.2
	4.5	64%
22	69%		40%
	10.0
2.
1.0	31%	2.5	36%
FY02/22		FY02/24	FY02/31
	Approx. 8%		10% or more

	Aim to achieve sales and operating profit growth by expanding the Lifestyle
	Segment while transforming the business model of the Apparel Segment
4	with a view to the post-COVID era.

Business Segments

Customers (Individuals and Corporate Clients)

Business	B2C	Apparel Segment		Lifestyle Segment
High-Quality Standard		Wellness
		Unique Value		Beauty & Cosmetics
Segments	B2B	Neo Business Model	B2C	Pet & Home Life
		Product Services		Gourmet Foods
		Platform Services		Gifts

B2B

Group Platforms (Systems)

Onward Holdings

Grow the Lifestyle Segment to be a core business on par with

the Apparel Segment.

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Management Platforms (Systems)

Customers (Individuals and Corporate Clients)

Platforms Group (Systems)

Apparel Segment

Lifestyle Segment

Product planning, production, and distribution platform

Sales platform (Onward Crosset/OMO stores)

Marketing platform (Onward Members)

Management and financial management platform

Organizational and HR platform

Onward Holdings

Build up-to-date Group platforms (systems) to enhance Group synergy

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Five Strategies toward FY02/31

Targeting sales of 300 billion yen and operating profit of 25 billion yen in FY02/31

Five Strategies

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4

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Transform the Apparel Segment business model

Accelerate growth in the Lifestyle Segment

Strengthen B2B business

Evolve into a company where diverse and unique

personnel can exhibit their strengths

Promote sustainable management

that pursues coexistence with the environment

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1 Transform the Apparel Segment Business Model: Three Main Policies

(1) Transform communication with customers

Build a community that grows autonomously and

co-create value with customers

(2) Transform product planning, production, and distribution

Digitalize the production process to improve speed, price optimization, and traceability

(3) Transform sales	*OMO = Online merges with offline

Develop OMO* stores that combine the advantages of physical and online stores.

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1	Transform the Apparel Segment Business Model:
	Brand Groups Developed under the Apparel Segment (B2C)

High-Quality Standard Business

A group of brands that create

"evolving staples" by

balancing quality and price, made possible by production expertise cultivated over many years

Unique Value Business

A group of one and only brands that continue to attract customers by communicating a strong individuality and worldview

Neo-Business-Model Business

A group of brands that

provide innovative customer experiences through a new business model that utilizes the latest digital technologies. We aim to make these brands

the core of our future

business.

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1 Transform the Apparel Segment Business Model:

(1) Transforming Communication with Customers

Up Until the Present	Desired Image for FY02/31
		Community where customers grow
Indirect, one-way communication,	autonomously through direct
communications between customers and
	distancing customers
	employees, and through interactions among
			customers
Distant connections to customers (indirect)	A community that grows autonomously
	Limited Points	Onward staff
	of Contact		Product development,
			personalization, made-to-
	Physical		order production
	Direct communication			Customers
	Stores	with customers			bring new
			Customers		customers
Onward	Customers
	Mass Media	Communication using
	(TV Commercials,	owned media and social
	Magazine Ads, Etc.)	media sites		New approaches such as
		Service provided by
			live commerce
			personal stylists

Use owned media, social media, and live commerce to promote value co-creation through

direct and two-way communication between customers and employees.

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1 Transform the Apparel Segment Business Model:

(2) Transforming Product Planning, Production, and Distribution

	Up Until the Present
A divided, opaque, and inefficient
	supply chain
Plan	Procure	Produce	Distribute	Sell
Trading Companies	Onward
Onward	Textile trading	Garment	Logistics	Retailers
	company	manufacturers	companies
	Yarn	Weaving
	manufacturers	factories
	Fabric
	manufacturers

Desired Image in FY02/31
A streamlined supply chain with processes
made explicit based on data-sharing and
	data-linking
	Trading
	companies
Retailers		Textile trading
	companies
Logistics	Onward	Yarn
companies	manufacturers
Garment		Fabric
	manufacturers
manufacturers
	Weaving factories

Shorten delivery periods, optimize prices, and improve traceability through visualization

of processes and promotion of data-linking while digitalizing the supply chain.

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1 Transform the Apparel Segment Business Model:

(3) Transforming Sales

	OMO Stores		*In B2C Areas
Physical Stores			E-Commerce Sales Target
 Limited store inventories	 Can shop while enjoying the		for FY02/31
 Limited store hours and	atmosphere of stores		100 billion yen
locations	 Can touch and try on items
 Some customers feel annoyed by	 Can be helped by stylists		(e-commerce ratio of 50%*)
sales staff and are unable to	 Can take purchased products
shop at their own pace	home right away

	 Operates 24/7, all year round	 Cannot touch products or feel
	 Can purchase from anywhere	the atmosphere of stores
Location Strategy	 Can select products from	 Cannot try on items
for OMO Stores	nearly the entire inventory	 Cannot receive customer service
Shift from urban centers to a	 Select a stylist you like	 Lead times until products make
 Can shop at your own pace	it to the customer
balance between urban and
suburban locations

Online Store

Use OMO format that combine services provided at physical and online stores to

maximize the advantages of each for customers

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2 Accelerate Growth of the Lifestyle Segment

Create Synergy Within

the Group

Prioritized allocation

of managementImprove brand value resources

	Wellness	Beauty &
	Cosmetics
	Gourmet		Gifts
	Foods
			Pet &
Expand community		Home Life
		Promote M&A
and sales channels

The five businesses of the Group's Lifestyle Segment show steady results even amid the COVID-19 pandemic. We will vigorously push forward with our growth strategy for the post- COVID world with the Lifestyle Segment as our core segment.

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2 Accelerate Growth of the Lifestyle Segment: Strategy of Leading Companies in Different Areas

Wellness business

Business:

Comprehensive business development including the sale of ballet/dance goods and cosmetics, and the operation of ballet schools

• Continue to develop the traditional core ballet business, while strengthening brands appealing to wellness (Chacott Balance and Chacott Cosmetics) to express the worldview of the brand philosophy, "Make life beautiful from the inside out."
• Scheduled opening of a next-generation global flagship store in Daikanyama in spring 2022

Beauty & Cosmetics business

Business:

Dealing in the "product," an organic haircare and skincare brand

• Accelerate expansion of product categories in skincare and body care
• Expand physical and online sales channels (including global development) and increase brand recognition through PR including collaborations
• Quickly establish a status as an organic cosmetics brand

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2 Accelerate Growth of the Lifestyle Segment: Strategy of Leading Companies in Different Areas

Pet & Home Life business

Business:

Development of comfort goods and pet-related products

• Expand selection of everyday goods to enhance people's lives as they spend more time at home
• Enhance the lineup of cat products in addition to mainstay dog products
• Launch "Hinami," a lifestyle brand for hygienic and safe living

Gourmet Foods business

Business:

Operation of a high-qualitye-commerce site for gourmet foods

• Contribute to enhancing customers' "home time" and expanding sales channels for producers
• Enhance the value and uniqueness of the site by expanding categories handled and developing original products
• Plan to begin cross-border e- commerce of delicious and safe Japanese gourmet foods

Gifts business

Business:

Development of a gift solutions featuring gift catalogues

• Strengthen direct online sales and enter the "social gift" market, which is expected to grow
• Provide new value to customers by developing new products and services

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3 Strengthen B2B Businesses

Product Services business

(for general corporate clients)

Provides uniforms, promotional products, and services to general corporate clients. Assets shared within the Group to maximize synergies.

Onward Trading's uniform business

Platform Services business

(for retailers and the apparel industry)

OEM/ODM business for retailers and the apparel industry. Utilizes product planning, production, and distribution platforms that are visualized and streamlined through information sharing and data-linking.

Kashiyama Dalian

These businesses have been robust even amid the COVID-19 pandemic. We position them as stable growth businesses in the post-COVID era, and target sales of 60 billion yen (20% of total sales) in FY02/31.

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4 Evolve into a Company Where Diverse and Unique Personnel Can Exhibit Their Strengths

	Promote the
	activities of diverse
	personnel
	(achieve 50% women in
	leadership positions by
	FY02/31, and other
Achieve a flat	goals)
Diversify
organization	workstyles

Organizational and

HR platform reform

Transfer		Offer multiple
	career paths
authority to
	and personnel
the job site	Fair, multi-
development
	faceted
	evaluations
	and
	performance-
	based
	compensation

By training in-house personnel who will spearhead change, or recruiting personnel externally, and promoting organizational and HR platform reform, we will evolve into a company where diverse and unique personnel can play an active role.

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5 Promote Sustainable Management that Pursues Coexistence with the Environment

Example: Find more ways to use recovered products(blanket donations in cooperation with the Japanese Red Cross

Example: Expand the made-to-orderbusinesscentered on Kashiyama Dalian

Society, stepping up the Reuse Park initiative)

Eliminate wasteful production

(Expand made-to- order production)

Main initiatives

toward sustainable

management

Example: Increase awareness of factory auditsat the Japan Apparel Quality Center

Recover and	Improve
reuse products	traceability

We will establish an organization dedicated to the promotion of sustainable management in FY02/22 and advance efforts in this direction based on the recognition that sustainable management is an important ideal that underpins our corporate activities.

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The information in this presentation is not a solicitation to purchase or sell Onward Holdings stock. Opinions and forecasts stated herein represent the judgments of the company at the time this presentation was prepared. Onward Holdings makes no guarantee regarding the accuracy of the information in this presentation and may make revisions without prior notice. Onward Holdings and the providers of this information assume no responsibility whatsoever for any losses incurred in association with this information.

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