|
|
 |
|
 |
|
|
|
|
|
|
|
|
| From Noodles to Missiles: The Negative Effects of the Something-for-Everybody Style of Business |
|
| The functions of the sogo shosha included the following: transaction functions, such as trading; stocking functions, such as warehousing; information-related functions, such as information gathering; financial functions, such as financing; marketing functions; and coordinator functions. Because of this, their relationship with manufacturers and retailers went beyond that of a wholesaler that simply passed goods from one to another. They also supplied their customers with business-related information, made various business-related proposals, and became joint guarantors, etc., supporting their customers in various aspects as a business partner. |
| While Japan was still in a period of high growth, the "something-for-everyone" style of business that handled anything from "noodles to missiles" was said to be the strength of the sogo shosha. However, during the deflationary economy of the 1990s, that "something-for-everyone" style of operations ironically hampered the general trading companies. As explained earlier, they dealt with massive amounts of items, and this resulted in their being hampered with vast amounts of interest-bearing debts focused around bank loans. This became a major burden for the sogo shosha under a deflationary recession. |
|
Marunouchi Oazo(the Esperanto meaning for oasis), a multipurpose commercial complex built just north of JR Tokyo Station |
|
|
| The Spread of Internet Transactions, Etc.: Companies Are No Longer Dependent on Trading Companies |
|
There are an increasing number of retailers that are purchasing products directly from manufacturers without going through trading companies. B2B transactions over the Internet that take place directly between businesses without the intervention of trading companies are also starting to spread. The role that trading companies had to play in the economy decreased rapidly, and some people could even be heard saying that trading companies were no longer a necessity. Sogo shosha had no choice but to restructure their businesses under the catchphrase, "selection and concentration."
Until the mid-1990s, the word sogo shosha pointed to nine companies: Mitsubishi Corporation, Mitsui & Co., Sumitomo Corporation, Itochu, Marubeni, Nissho Iwai, Tomen, Nichimen Corporation, and Kanematsu Corporation. Kanematsu, however, disposed of unprofitable divisions and made a new start as a specialized trading company that dealt in specific fields such as semiconductors. Nissho Iwai and Nichimen merged their business in April 2003 by establishing Nissho Iwai - Nichimen Holdings Corporation (renamed Sojitz Holdings Corporation). The company is currently undergoing corporate rehabilitation with the support of UFJ Limited, its main bank. Tomen, after receiving two debt waivers from its main bank, UFJ Limited, received additional support from the Toyota Group. It is aiming for future consolidation with the Toyota Group's Toyota Tsusho. |
|
|
|
|
|
|
