CORPORATE PROFILE

Always beside you, always.

KOMERI CO., LTD.
Head Office4501-1 Shimizu, Minami-ku, Niigata City, Niigata Prefecture, 950-1492 Japan
TEL: +81-25-371-4111（main switchboard number）

https://www.komeri.bit.or.jp©KOMERI CO., LTD.

Wish of KOMERI

Initially founded as a rice-dealing firm, KOMERI subsequently

We wish for our business to exist

business. KOMERI is committed to always staying attuned withfor the happiness of people in society,our role in providing social infrastructure in the categories

began selling fuel before being prompted by 1973 the oil crisis
to make its entry into the world of home improvement center

the times and venturing into new businesses. We aim to fulfill

of housing, daily living, and agriculture, as well as maintaining

regionally indispensable businesses through the ways wefor the happiness of the people who

assist customers in realizing lives of abundance.

1952

gather here, and for the happiness ofFoundedeveryone encompassing our business.

Among the three necessities of life — food, clothing, andhousing — it is distribution in the“housing,”or housingrelated category, that has been slowest to keep up withthe times.
Still today, within this sector, the modernization of salechannels and logistics has yet to be fully charted in terms

KOMERI Co., Ltd.

President & CEO

Yuichiro Sasage

Description ofBusiness

Operating retail chains, including KOMERIPower and KOMERI Hard & Green

FoundedApril 1952

Established

July 1962

Capital Stock

18,802 million yen

Stock Listed

Tokyo Stock Exchange Prime Market

Head Office4501-1 Shimizu, Minami-ku, Niigata City,

gardening and agriculture. At KOMERI, we consider it oursocial mission to provide customers with better products
advantage of operating the greatest number of stores in

number)Tokyo Information
Center

7F, Akihabara UDX Bldg., 4-14-1 Soto Kanda,
Chiyoda-ku, Tokyo

URL

https://www.komeri.bit.or.jp/en/
NiigataStation

Sea of
Japan

er

1

Yuichiro Sasagev
Ri

KOMERI Co., Ltd.

oPresident, CEO

ahik

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Establishes KOMERI Disaster Management Center NPO

Yasuda IC

Opens first KOMERI PRO store(Tsu City, Mie Prefecture)

2019

am

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SANKA Co., Ltd.

wish to put smiles on customers’faces. In the years ahead,

gladdened by the existence of KOMERI.

an

JR Y

↓Nagaoka

Begins online sales

2014

8

Tsubame Sanjo
Stationemployees, who strive hard at their work daily with theworld and to our customers in the hope that all may feel

2005

Ag

Sanjo
Tsubame IC

financial institutions, business partners and local residents

we will continue with our aim to be truly beneficial to theNiitsu IC

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9

shareholders and investors, those who work with us at
who cooperate with us to grow our business, and our

49

403

to exist for the happiness of all who interact with us,
including customers who make use of our stores, our2003Enters home remodelingbusiness

Opens first KOMERI Power store(Presently, Akiha Ward, Niigata City, Niigata Prefecture)u ayts
ne ssw
Ba preEx

9

Establishes Greenery Aid Foundation (currently,
KOMERI Midori Ikuseizaidan/Public Interest
Incorporated Foundation)

2000

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Makikata
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1996

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people who have supported us. We wish for our business

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KOMERI stands today thanks to the great number ofNiigata Chuo IC
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through sales that feature low cost and the most logicaldesigns.

Niigata Nishi IC

HoJapan to structure frameworks from production all the way

Opens first KOMERI Hard & Green store(Shibata City, Niigata Prefecture)

Tel: +81-25-371-4111 (main switchboard

at lower prices. To accomplish this, we leverage ourOpens first KOMERI Home Center store(Sanjo City, Niigata Prefecture)

1983

Niigata Prefectureof reaching customers with products such as materials,
building materials, hardware, tools, and supplies for

1977

Company Name

Active as dealer of rice, fuel,and household furnishings

Company profile

T o p Message

History of KOMERI

o→

2020
Shimizu

Chuetsu Tsuun
Shirone Office8

Opens 1,200th KOMERI store

2021←IwamuroHe
Off adice

Begins cooperative business with Kamiina Agricultural
Cooperative

9

Ka

Opens first KOMERI store in Thailandmo

Always beside you, always

→

2022

70th anniversaryof foundation↓Sanjo / Nagaoka

2

Always beside you, always

Always beside you, always
KOMERI originated in Niigata Prefecture’s Sanjo, a city with a wellestablished history of producing hardware.
The verdant Echigo Plain is one of the leading agricultural regions ofJapan, and the Shinano River basin is home to an extensive area ofhorticultural production.
KOMERI found this to be fertile ground for making its entry into the home
improvement center business, in which it has focused on products such as
materialls, building materials, hardware, tools, and supplies for gardening
and agriculture.
Our dream is to create retail chain stores worthy of the KOMERI
name that are not found anywhere else, and to provide more and morecustomers with better products at lower prices in every town and city,and lives of greater abundance as well.
Looking forward, in the midst of drastic social changes, we will remain
steadfastly committed to these themes.

Mission of KOMERI

4The Home
Center markets

trillion yen

KOMERI share

10 ％The materials andbuilding materials,
gardening and agricultural
materials markets

5

trillion yen
Modernization oflogistics in lagging sectors

We are committed to being there for our customers
and expanding our network of stores in line withlocal needs to help people realize lives of abundance.
Forming areas of dominance within more
limited trading areas

to stay close to our customers andprovide them with better
living environments.

We are committed to sparking logistics-related
innovation in the Housing and Gardening/Agriculture
sectors to support changing lifestyles.

Through our home improvement center
business, we aim to help achieve the SDGs
and create a sustainable world.

Amid the striking changes occurring in modern society, KOMERI is committed
to leveraging its original services and operations to resolve customers’issues.

We aim to make expansions in the Housing and Gardening/Agriculture sectors,
take on challenges presented by new business opportunities, and improve ourcorporate value by tackling each of the issues associated with the SDGs.

Proprietary logistics
network andinformation system

Original productdevelopment

Strengthening ofservice capabilities

Sources: KOMERI estimates based on“Current Survey of Commerce”(Ministry of Economy, Trade and Industry),“National Household
Income and Expenditure Structure Survey”(Statistics Bureau, Ministry of Internal Affairs and Communications),“Census of
Agriculture and Forestry”and“Business Statistics by Farming Type”(Ministry of Agriculture, Forestry and Fisheries)34

St o r e
Aiming to be a store where customers can consult and find solutions to

A store specializing in two core categories: the“Hard”

any challenges they might be having with their living spaces. Making

sector consisting of materials, building materials andadvantageous use of their sales floor spaces of approx. 9,256 m2 to 12,233

other hardware, tools, and so on; and the“Green”sector

m , the stores provide ample lineups of products and services, helping

focusing on gardening and agricultural supplies. With

customers create pleasant and enjoyable living spaces. Further, as total

the low cost of operations for the stores, they can evenproduct centers offering comprehensive support for professional customers,

be opened in smaller trading areas with populations of

the stores are set up to offer the products their work requires, always ataround 10,000. Providing locally appropriate products

affordable prices, and with necessary amounts in stock so that they are

and services at reasonable prices, they work to be

immediately available for purchase.

stores regarded as essential by customers as a form of2

infrastructure that supports the lives of local residents.

An aggregation of specialty shops: The seven KOMERI Power sales zones

Main Space

Remodeling Corner

KOMERI PRO, an independent form of
the KOMERI Power Materials Annex

Materials Annex

A store specializing in materials, building

The highly
specialized
Materials Annex,

in a stand-aloneformmaterials, hardware, and tools, formed as astand-alone version of the Materials Annex sales
zone from the mega home improvement center
KOMERI Power. Provides a product lineup
comparable to KOMERI Power for these sectors,

Gardening Annex

Pet Supplies Corner

Interior Decoration Corner

Bicycle Supplies Cornermaking it a dependable choice for professionalcustomers such as building contractors as well.

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Gr o wt h st r at egy

Differentiation from Competition with Two Core Categories

Product Development

Since KOMERI opened the first Hard & Green store in 1983, it has worked to differentiate these stores from competitorswith its pair of core categories: the“Hard”sector consisting of materials, building materials, hardware, tools and so on; andthe“Green”sector focusing on gardening and agricultural supplies. We have also bolstered product lineups of materials to
make the stores a reliable choice not only for customers working on DIY home repairs and maintenance, gardening and home
vegetable plots, but also professionals in the construction industry, including building contractors, and farmers who make aliving from agriculture. Also, in these times with an aging society and declining birthrate in Japan, it is important to provide
not only products but services such as installation and construction. We are striving to improve customer convenienceby providing remodeling-related proposals mainly at KOMERI Power locations and services aimed at offering solutions
concerning living environment that customers can access at more than 1,200 stores throughout the country.

Based on a philosophy of providing better products at lower prices and not burdening customers with a single yen in unnecessary
costs, the KOMERI Group has realized its low-cost operations by employing standardized chain store operations, along with
proprietary distribution and information systems, and product development, leveraging its operation of the greatest number ofhome center stores in Japan. We remain committed to building a framework to support sustainable growth.

Advantages of KOMERI

Comprehensive Handling of Logistics from Production through Sales

Remodeling-Related Materials Market

Horticultural and Agricultural Materials Market

Products used in large
quantities on a daily basis
by construction industry
professionals such asbuilding contractors are
kept continually in stock,
providing a reliable
environment.
We are committed to providing
support for the resolution ofissues with living environment
problems by expanding ourlineup of tools, building andother materials to respond to
the needs of everyone from
DIYers to professionals.

We work to meet theneeds of farmers byproviding a full lineup of
the materials they may
need in all stages of theirwork, from the planting
through the harvest of
agricultural produce.
We also offer remodelingservices for customers who may
experience difficulty performing
the work themselves. Fromsimple replacement work to fullscale remodeling, we operate
the greatest number of home
improvement stores in Japan.

We also offer a wide range ofother services to help customers
resolve problems around thehome that they may find difficult
to perform themselves, including
house cleaning, upkeep ofgarden trees and shrubs, andtermite extermination.

We have agriculturaladvisors stationed
throughout Japan tosupport farmers byproviding guidance on
farming and advice on
products.

農産物流通支援We stock ample selections of
seasonal flowers and vegetableseedlings along with products
necessary for garden work,
spaces where even beginners
are comfortable trying theirhand at gardening and planting
home vegetable plots.

Product capabilities, Logistics/information system, Low-cost operations

Product
planning

Raw material
procurement

Manufacturing
and production

Logistics

Sales

The strength of having more than 1,200 stores

Store Brand Products
KOMERI has engaged in product development ever since opening its our first KOMERI Home Center store. We
develop products for daily life from the standpoints of“users”and“buyers,”focusing on building and construction
materials, hardware and tools, and gardening and agricultural products, which are handled as core categories.
We engage in sales ofagricultural products
produced by farmers in allparts of Japan online andthrough other channels
to support distribution of
the farmers’agricultural
products.

Percentage of Store Brand Product Sales Over Time

Aiming for

50 ％Brand product sales

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021

sales goal

*All ﬁgures are based on ﬁscal years ended March 31

Toward a Stage of Product Development One Cut AboveUBERMANN is an original KOMERI brand for which we perform all stages of production in-house in a consistentmanner, from product planning and design to the creation of molds for the products. Based on the concept ofdelivering“the quality a professional would choose,”the products are manufactured with high-quality materials instrictly managed factories, finished to the level of quality that professionals demand for each consideration, fromtheir durability and operability to repairs and the product lineup.
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Gr o wt h st r at egy

Advantages of Having the Greatest Numberof Home Improvement Stores in Japan

Since the 2000 launch of our e-commerce (EC) site, KOMERI.com, our e-commerce business has

KOMERI has opened more than 1,200 stores throughout Japan to date. Still, in terms of the number of

product layaway services at stores, and more.

municipalities within the country, less than half have opened KOMERI stores at present. This indicates the

E-Commerce
expanded annually, and we have gone beyond selling products by introducing installation services,
Through KOMERI.com, we aim to provide customers with improved convenience by supplementing ourlineup of products that are more improved convenience by offering additional products online that arepotential for us to open additional stores in the future to achieve further growth.
Also, with the standardized product lineups and store operations of KOMERI stores, the power of thenumber of standardized stores translates into higher product development capabilities and lower costs forstore operations. Add to this our proprietary logistics and information systems, and the break-difficult to handle in our stores, while also offering a wide array of methods for customers to receive
products. In particular, with our layaway service generally offering free shipping, which takes advantage
of our industry-leading store locations and proprietary distribution system, we receive many orders forthe large items, long items, and heavy items that tend to incur high costs for home delivery elsewhere.

even point becomes even lower. This is one of the greatest advantages KOMERI offers.

In a store

At homeAt the jobsite

Store-Opening Strategy
Our strategy in opening stores is based on the“fleet method”— blanketing smaller trading
areas with Hard & Green locations, and opening KOMERI Power locations in major trading
areas— fleet method to create areas of dominance where our stores are concentrated.
We believe customers choose stores based on proximity, affordability, and productlineups. We offer customers greater shopping convenience by opening KOMERI Powerand Hard & Green locations throughout Japan in line with theOrderpopulation demographics of these trading areas.

Purchase online

Layaway Service

Order

Order
DeliveryPick up at the store

Store
Logistics Center

In-store pickup

Fleet Method
Lockers offering 24-hour pickup
now in operation (from Sept. 2020)

Establishing Regular Customers (Credit Card Business)
To meet customers’diverse account settlement needs, Group company KOMERI CAPITAL Co., Ltd. issues five different credit cards: the KOMERI
Card and Aqua Card for general customers, the Business Card and Agri Card for businesses, and the Kankocho Card for government agencies.
Furthermore, the KOMERI Card and Business Card offer programs in which the rate of return increases with the amount of money spent.

910

Logistics: From the Best Sources in the World
A key piece of the infrastructure supporting
operations at the mass stores KOMERI operates
is our logistics system. Based on the concept ofestablishing logistics centers and opening stores
accordingly, we have been building our own logistics
system since the opening of our first KOMERI Home
Center, based on the premise of opening massstores.
At our distribution centers, batch orders of products
are made for all the stores in the delivery area, theninspected, sorted, and delivered to each of thestores. This makes delivery more efficient, reduces
the workload at stores, and helps us achieve lowcost operations. Having the logistics centers also
makes it possible for us to do business with suppliers
who lack logistics functions of their own.

SDG Initiatives
We are working to resolve a variety of SDG issues, guided by the belief that focusing our efforts on the categories of Housing
and Horticulture/Agriculture through our core home improvement center business will help contribute to implementation of theSDGs themselves. Our efforts toward realizing the SDGs will lead us to take on challenges with new business opportunities
and improve our corporate value. It will also connect to the cultivation of our future executive management.

Climate Change and Decarbonization Initiatives

Our 11 logistics centers in JapanThe 11 logistics centers in Japan and overseas consolidation base we

operate enable us to procure products from the best sources in the world.

HOKUSEI SANGYO Co., Ltd. is a Group company that manages andoperates our logistics centers. It takes care of all operations, fromprocuring products to supplying them to stores, and helps support lowcost for operations of stores with its construction of an efficient logistics
network appropriate for products carried by home improvement centers.

In our core category of building materials, we sell structural
plywood made from domestically-grown sugi (Cryptomeria
cedar) as a store brand product. By using domestic
timber that has reached a suitable age for harvesting as abuilding material, we expect to help revitalize the forestry
industry in Japan, increase forests’CO2 absorption rates,
and realize long-term storage of carbon by using it as abuilding material. We are also committed to contributing to
reduced consumption of fossil fuel-derived energy throughour provision of energy-efficient remodeling proposals
encompassing housing with solar energy, high airtightness,high thermal insulation, and more.
Additionally, some of our KOMERI Power stores anddistribution centers have rooftop systems for solar power
generation.
Allowing suppliers to make use of our 11 distribution
centers located throughout Japan enables us to improvedelivery efficiency and reduce the amount of fuel used fortransport.

S up p lier sInformation System

KOMERI distribution center

A

Another key piece of the infrastructure supporting
operations at the mass of KOMERI stores is our
information system. We have aimed to reduce
workloads at our stores and improve theirefficiency by constructing our own system for store
operations and logistics, including product inventory
management, order placement, and attendance
management, tailored to home improvement center
operations.
Also, we strive to provide enhanced customer
service by constructing a system in line with the
expansion of our business fields, such as thedevelopment and operation of e-commerce andcredit card systems.

B

C

Providing Local Infrastructure

We have introduced smart phones as handheld terminals
to improve work efficiency for store employees.

Bit-A Co., Ltd. is a Group company that handles the development and operation of the
KOMERI Group’s information system. In addition to the information processing andsoftware development needed for the work KOMERI Group companies perform, thecompany also produces online and printed materials, engages in the sales and installationof various types of equipment, and performs network construction proxy services.

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Sust ai n ab i l i t y

Gr o wt h st r at egy

Store-Supporting Infrastructure

Our KOMERI Hard & Green store format is viable even in smaller trading areas with populations of around 10,000. We hope to continue being of service
to customers, including in areas with aging populations and declining birth rates, as local infrastructure allowing customers to purchase products related tohousing and horticulture/agriculture nearby.
When natural disasters such as typhoons and earthquakes have occurred, we have been able to take on the role of supplying resources needed for recovery
and reconstruction. We also plan activities through which employees volunteer in activities with children to plant flora and make their school grounds
greener, from preschools and kindergartens to elementary and middle schools. Through these activities, we work to convey to children the richness andpreciousness of nature by providing them with opportunities to come into contact with soil and plants to experience the joys of planting and nurturing flora.

During times of disaster,
we work to continue
supplying products in
temporary sales spaces
alongside store repair
work that we perform.

We support employee
efforts to increase
greenery with local
children and students
on a volunteer basis.

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Sust ai n ab i l i t y

Working with Employees

Social Contribution Activities

Creating Environments Where Diverse Human Resources Can Actively Participate
We strive to maintain environments in which diverse human resources are able to demonstrate their capabilities andplay active roles at work in response to diversifying lifestyles amid Japan’s falling birth rate and aging population.
Beyond creating environments in which each employee can feel fulfilled in their work, we are also working to establish
diverse work styles in order to develop and retain human resources.

Productivity Improvement Initiatives
Along with our approach of opening standardized stores in large numbers,
since our founding have worked continually to simplify and standardize
store operations and build a framework to maintain low-cost operations.
By developing environments in which diverse human resources are moreable to demonstrate their capabilities and play active roles at work, we areenhancing productivity levels and our working environments.

KOMERI Meister System

The Path to Developing Specialists

Through our Meister system, an internal

ハード系
we cultivate3employees who are
3 qualification,

Management,
Executives

Meister

Specialists

Store personnel,
store support center staff

solving customers’issuesMeisterand offering proposals
in response to their requests and demands.

3

マイスター

Meister

３級認定

Green

グリーン系

3

Green
Meister

Employee Award System
Based on the philosophy that“people are the most important mainstay ofour business,”we work to create environments in which each and every
employee is able to fully demonstrate their abilities, perform their job witha sense of fulfillment, and help resolve social issues through their work. As
part of these efforts, we have established an employee award system torecognize employees based on their efforts and achievements in accordancewith priority policies set at the beginning of each year, an initiative thathelps to increase employee motivation and strengthen solidarity.

Working with Business Partners

13

KOMERI Midori Ikuseizaidan aids regional greening andnature conservation activities, as well as facilitating
employees’participation in volunteer program andconducting activities to promote local agriculture. Since thevolunteer program was founded in 1999, around 20,000
employees have taken part. Additionally, the handson KOMERI Farm offers local residents opportunities
to participate in rice planting, potato harvesting, and soon. We hope to contribute to sustainable agriculturaldevelopment by helping people learn about farming while
having fun at the same time.

skilledat customer
service, capable ofHard highly マイスター
Hard
３級認定

Gardening/horticulture-related internal qualifications

KOMERI Group is committed to engaging infair and transparent transactions with business
partners in order to build relationships of
impartiality and equality as a trusted company.
Additionally, we post our Promises to Business
Partners at locations including the businessmeeting room at our main office outlining ourideals for relationships with business partners.
We are committed to engaging in transactions
with respect for our partners’standpoints on
the basis of mutual trust of one another.

In 1990, we established the KOMERI Greenery Fund. Every year since,
we have allocated amounts equivalent to 1% of our profits to support
regional greening and nature conservation activities, agricultural
promotion, infrastructure development to ensure the stable supply of
resources in times of disaster, and cultural and social contributions.

KOMERI Midori Ikuseizaidan (Public Interest Incorporated Foundation)

Human Resource Cultivation
After joining KOMERI, employees
spend about three years gaining
experience working to master store
operations. Subsequently, individualc ar e er p l an s ar e f o r mul a t e d f o r
employees according to their aptitudes
and abilities, based on age-oriented
technical goals and other criteria.

KOMERI Greenery
Fund (1% of profits)

Promises to Business Partners
1. We will meet and consult with business partners in a positive and gentlemanly manner.
2. We will reliably uphold the promises we make to business partners.

3. W
 e will not, in principle, make unreasonable returns to our business partners.

4. W
 e will be fair in our dealings with business partners and shall neither accept
entertainment or accommodations from business partners nor provide such to them.

KOMERI Disaster Management Center (Non-profit Organization)
KOMERI Disaster Management Center are part of a
unified network of local governments from throughout
Japan, KOMERI Group companies, and partnercompanies to ensure the prompt, uninterrupted supplyof resources during times of disaster. In addition toproviding disaster management-related information on
our website, KOMERI Disaster Management Center
also work to raise disaster prevention awareness bytaking part in disaster drills held in various locations.

SETSURYOSHA Artistic Cultivation Foundation (Public Interest Incorporated Foundation)
SETSURYOSHA Museum of Art was establishedin 1993. The SETSURYOSHA Firenze Prize
Exhibition, a public competition held annuallywith the aim of cultivating young artists,
provides backing for creative activities byoffering the grand prize winner support foreign
study in Florence (Firenze), Italy.

5. We will not accept gifts from business partners as a company or on an individual basis.

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