Japan seeks new spunk for lagging trading firms
Nowhere in Japanese business is diversification more assiduously pursued than among sogo shosha, the famous general trading companies that orchestrated Japan's postwar economic miracle.
Their original raison d'etre was organizing imports of raw materials and exports of the finished product. At last count, 60 percent of Japan's imports and half its exports were handled by the nine leading trading houses, whose total business in fiscal 1982 ($330 billion) was equal to about 30 percent of Japan's total output of goods and services.
But sales have shown little growth in recent years and profits are poor. Business in traditional products like steel is declining, and the new wave of high-tech companies is bypassing the sogo shosha to deal directly with world markets. Some Japanese, in fact, are saying the general trading giants may need another miracle to avoid going the way of the dinosaurs.
Not so, says Isao Yonekura, president of the third-largest company, C.Itoh. Those predicting the demise of the sogo shosha simply haven't been paying attention to the diminishing role of straight third-party trade in their overall business activities, he feels.
''The whole reason for our existence is to anticipate change. Today the need is to marry the newly emerging high technology with our traditional trading functions to form dynamic new entities.''
Times are difficult, concedes Toshikuni Yahiro, president of Mitsui & Co., and risks are inevitable. But the sogo shosha must respond to the changes by becoming even more international, particularly in offshore trade not involving Japan, and in aggressively investing in telecommunications and other high-tech fields.
''The sogo shosha have been inclined to deal with goods that are heavy, thick , long, and big,'' Mr. Yahiro says. ''Now we must shift to what is light, thin, short and small.''
Increasingly, Mr. Yahiro and Mr. Yonekura agree, the answer lies in the trading companies' investing in various industries, not simply picking up the middleman's profit for shipping the products. Sogo shosha now act as bankers and organizers of international cartels for major construction projects, and these no longer have to have a heavy Japanese involvement. They are active in the search for energy resources.