Abstract

The Japanese food manufacturing industry has been expected to strengthen the country's industrial competitiveness and local economy revitalization. This article examines the technological capability and profitability of food manufacturing companies in Hokkaido, which is considered one of the most active food production areas in Japan. Financial information and one output from innovation activities, specifically patent information, have been utilized and analyzed. The analysis revealed four findings. First, very few strong relationships were seen between the sales amount and net profit to sales of Hokkaido food manufacturing companies. Many small and medium companies with high profitability were prevalent. Moreover, although food companies in the Tokachi district were smaller in size, they achieved higher profitability compared to food companies in Sapporo City. Second, food companies who possess patents showed higher profitability than those who do not possess patents. Third, food companies with high technological indicators such as the number of patent examinations and cited patents seemed to be capable of further increasing their business performances. Fourth, the technological capability of the whole region including Sapporo City and the Tokachi district showed an increasing trend in general. Although the Tokachi district still had a small number of patent applications, this area exhibited rapid improvement in its technological capability.

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