TOKYO - Tokyo Lifestyle Co., Ltd. (NASDAQ:TKLF) announced today that it entered into a three-year franchise agreement with FLUSH Co., Ltd. on March 30, 2026, according to a press release statement.
The agreement grants FLUSH franchise rights and a non-exclusive license to operate household-goods retail businesses under Tokyo Lifestyle’s brands, including Tokyo Lifestyle and REIWATAKIYA. FLUSH is a company engaged in AI-driven digital operations with market development experience in Osaka and Western Japan.
Tokyo Lifestyle is a retailer and wholesaler of Japanese beauty and health products, sundry products, luxury products, electronic products, collectible cards, and trendy toys in Hong Kong, Japan, North America, Thailand, Vietnam, the United Kingdom, and Australia. The company, with a market capitalization of $8.42 million, has delivered 38% revenue growth over the last twelve months despite trading at a low P/E ratio of 1.89. According to InvestingPro analysis, the stock appears undervalued at current levels, landing it on the platform’s Most Undervalued list, though the company operates with significant debt and weak gross profit margins of 9.1%.
The partnership will begin with a franchise store in Ginza, Tokyo, with plans to expand into the Western Japan market, particularly the Kansai region, targeting a network of eight stores.
"We are excited to partner with FLUSH to accelerate the expansion of our franchise network in Japan by leveraging FLUSH’s strengths and resources," said Mei Kanayama, Principal Executive Officer of Tokyo Lifestyle.
FLUSH will integrate an Online-to-Offline model and AI-powered live broadcasting capabilities into the franchise operations. The company has experience in digital operations and market development in the Western Japan region.
The initial term of the franchise agreement is three years. Tokyo Lifestyle currently sells its products through directly-operated physical stores, online stores, and to franchise stores and wholesale customers.
In other recent news, Tokyo Lifestyle Co., Ltd. has secured a $2.56 million investment for its Hong Kong subsidiary to support regional operations and expansion. This investment, finalized by March 31, 2026, will be directed toward operating expenses, market expansion, inventory replenishment, and procurement for the subsidiary’s retail stores. Additionally, Tokyo Lifestyle has signed a one-year master agreement with TASLY (HONG KONG) INTERNATIONAL HOLDING COMPANY LIMITED to distribute health products, cosmetics, and liquors. This agreement, effective from March 1, 2026, establishes Tokyo Lifestyle as a supplier on an outright purchase basis, with specific terms to be decided through individual agreements.
Moreover, Tokyo Lifestyle has entered into a strategic cooperation with BrainAurora Medical Technology Limited to develop a digital health platform in Japan and Southeast Asia. Under this three-year agreement, Tokyo Lifestyle will leverage its retail network for product system design and customer delivery, while BrainAurora will focus on technical development and regulatory compliance for digital therapy products. These developments highlight Tokyo Lifestyle’s efforts to expand its operations and partnerships in the region.
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