Struggling furniture retailer Otsuka Kagu Ltd. said Friday it has agreed to a business tie-up with a Chinese company in the same sector, as it looks to boost sales in the world's second-largest economy and turn its fortunes around.
The upscale furniture retailer based in Tokyo said it will also consider a capital alliance with Beijing Easyhome Yundi Huixin Retail Chain Co. and provide customer service know-how to the company backed by Chinese e-commerce giant Alibaba Group Holdings Ltd.
The cooperation with Easyhome, which operates more than 200 furniture stores across China and has been expanding online sales with the help of Alibaba, was endorsed at an Otsuka Kagu board meeting Friday afternoon.
The Japanese company has been streamlining its domestic retail outlets to cut costs and aims to boost its online sales through the deal with Easyhome.
Otsuka Kagu said it is still assessing the impact of the tie-up on its earnings.
The Japanese retailer, which posted a net loss in the nine months to September for the fourth consecutive year, had been looking for a business and capital partner, with candidates including home electronics chains Yodobashi Camera Co. and Yamada Denki Co.