The History of DCM’s Value Creation

 ahma Co., Ltd., Daiki Co., Ltd., and Homac Corp.
K
formed a business and capital alliance (February)DCM Japan Co., Ltd. established as a joint purchasingcompany (May)8

DCM Holdings Co., Ltd. Integrated Report 2023

2009
 C site launched (July)E
Private brand products launched underthe “DCM Brand” (November)

2015

2017
2016
 uroganeya Co., Ltd. joined
K
the Group and changed its
name to DCM Kuroganeya
Co., Ltd. (December)

Financial Highlights

2003

2010

Risk Management and Compliance2006

Corporate Governance1970s and 1980s

 ompany name changed toC
DCM Holdings Co., Ltd. (June) apital and business
Calliance with KeiyoCo., Ltd. formed, andit became an
equity-method
affiliate (January)

Sustainability

Kahma Co., Ltd., Daiki Co., Ltd., and Ishiguro Shouten Corp.
(later Homac Corp.) entered the home improvement retail business CM Japan Holdings Co., Ltd.
D
established as a holding company(currently DCM Holdings Co., Ltd.)(September) ahma Co., Ltd., Daiki Co., Ltd., andK
Homac Corp. changed their names to
DCM Kahma Co., Ltd., DCM Daiki Co.,
Ltd., and DCM Homac Co., Ltd. (March)
Sanwado Corp. joined the DCM Groupand changed its name to DCM SanwaCo., Ltd. (July)

Medium-Term Management Plan

History of DCM

Message from the President

Toshihiro Hisada, Chairman and CEO

Business Model

Taking on the challenge of creating newvalue based on the team spirit of 20,000
members who share the same passion
for customers.

theorizing the ideal state of how we should be for thesake of customers as the central axis. We tried to keep
our thinking focused on the customer, rather thanaligning to the way one of the operating companies
conducts business.
Furthermore, rather than presenting the ideal state
top-down, each person in charge had repeateddiscussions to find the optimal solution from thecustomer’s perspective through trial and error until they
were satisfied. Therefore, although it took time, I believe
we were able to construct the new style of DCM
objectively while integrating the three companies as theissues were cleared one by one. At the core of ouractions was ambition to “leave the past behind,cooperate, and create something new to become
the overwhelming No. 1.” Therefore, we now havea corporate culture that does not care about which
company employees originally came from. In this way,
we have been able to deepen our product development,
shelf space allocation, and new services through trial
and error—all aimed at increasing customer convenience.
It is truly gratifying that we were able to move forward
to the 2021 integration after having prepared well.
We believe home centers will be called upon evenmore to evolve beyond being a retailer of goods tobecoming a form of lifestyle infrastructure in light of thesocial issues facing Japan, such as a declining birthrate,
aging population, and depopulation of rural areas. To
achieve this, we must continually address our customers’changing needs and provide solutions that surpass theirexpectations. Through discussions and trial and error in
the process of management integration, we have beenable to accumulate the ability to respond to changes inthe environment, as well as develop the power to think
about how to solve problems. Based on the solidmanagement foundation we have built and the lofty
aspirations of all our employees, we at DCM will strive
to realize our Company Philosophy, “Do Create Mystyle:
Giving Shape to Your Dreams for Life,” and to achievesustainable growth. We look forward to your continued
support.

Values

I would like to first introduce our history to date as we
publish our first Integrated Report, which will explain
DCM’s value creation story and medium- to long-termbusiness strategy to our stakeholders.
After dawning in the 1970s, Japan’s home
improvement retail industry enjoyed remarkable growthin the 1980s and 1990s. The home center market
expanded rapidly as many companies from various
business formats entered the market nationwide.
By 2000, however, the market had transitioned froma growth phase to a maturity, and there was a growing
awareness of the inevitable impact of a declining
population on the future. With this long-term outlook,
the starting point for the DCM Group was a group of
like-minded individuals who came together to “establish
an overwhelming No. 1 position in the Japanese home
improvement retail industry and grow toward thefuture.” These individuals were representatives of Kahma
Co., Ltd., Daiki Co., Ltd. and Homac Corporation.
We first established a joint purchasing company,DCM Japan Co., Ltd., in 2003 to strengthen ourprocurement capabilities.
At that time, the name “DCM” was chosen torepresent “Demand Chain Management,” or reforming
logistics from the perspectives of customers, rather thanthe conventional concept of retail of efficiently
purchasing and selling products made by manufacturers.
In 2006, DCM Japan Holdings Co., Ltd. (renamed DCM
Holdings Co., Ltd. in 2010), a joint holding company, wasestablished for the purpose of implementing more
unified business operations, and group management
was launched with three operating companies underits umbrella.
I am occasionally asked how DCM was able tosuccessfully integrate three listed companies as if they
had originally been a single entity? Indeed, all threeoperating companies were already well established intheir respective markets at the time, and their employees
were proud to work for them. In promoting themanagement integration of these three companies, ourbasic policy was to consider how we could achieve this, ive home center operating companies merged to form DCM Co., Ltd. (March)FDCM Philosophy established (March)

2021

2019
 YVOT launchedMas a commonmembership service(June)2022
 ystems Division spun off and DCM advanced technologies Co., Ltd. establishedS(January)Hodaka Co., Ltd. transferred from divisional management structure toan independent company (March)
XPRICE Inc., operator of one of Japan’s largest e-commerce websites centeringon household appliances, joined the Group (March)Store names unified to “DCM” (September)9