Sogo Shosha Research Articles

Socio-economic factors of changes in consumer behavior and strategies of trading companies in Japan

The article analyzes the structure and features of the retail trade sector in Japan, the current trends in the consumer behavior of the Japanese, which became noticeable at the end of the 20th century and especially after the global financial and economic crisis of 2008–2010 and during the COVID-19 pandemic. Based on empirical material, the author identifies the main directions of transformation of strategies of Japanese trade corporations under the conditions of economic instability and the formation of a new consumption model.Trade as a sphere of entrepreneurial activity is represented in Japan by various types of trading enterprises and companies and corporate groups of very different sizes and organizational and legal status. The market leaders are universal trading companies (sogo shosha) and large network companies (Seven & I Holdings, Aeon, Fast Retailing, etc.), which finance and organize not only the circulation, but also the production of products (from the development and purchase of raw materials to production and processing, logistics, sales, and services). The groups include numerous affiliated companies-retail operators.The characteristic features of the Japanese consumer have traditionally been the willingness to pay for quality, convenience, and service, a relatively low level of interest in cheaper goods, preference for the format of «physical» purchases, as well as the desire to buy expensive, exclusive things of luxury brands, which for many has become a sign of financial success and social status.Among the most important modern factors affecting the scale and structure of consumer demand in Japan are the desire to reduce one’s expenses in the face of slowing economic growth and stagnating incomes, increase in the level of environmental awareness, changing lifestyle and leisure patterns. The most important factor determining the image of the modern Japanese consumer was the entry into the labor and consumption market of generations Y and Z, who increasingly rely not on owning, but on using things, which acts as a factor in reducing the scale of the consumer market.In these conditions, trading companies modernize their strategies, including by entering into partnerships with national and foreign corporations in order to adapt to changing conditions and maintain competitiveness through modernization, diversification, and digitalization of business, reducing transaction costs based on the synergetic effect.

Trade between Canada and Japan and the Role of Sogo Shosha in It for the Last Decade

Trade between Canada and Japan and the Role of Sogo Shosha in It for the Last Decade

Changes in Sogo Shosha's Business Based on a Trading Right and Its Essential Function

Changes in Sogo Shosha's Business Based on a Trading Right and Its Essential Function

A Study on the Role of Sogo Shosha in Japanese ODA

A Study on the Role of Sogo Shosha in Japanese ODA

Resource Exchange and Strategy Compromise: Alliances between Small and Large Firms

This study examines the outcomes of alliances between small and large firms from the perspectives of small firms. We propose that small firms have to sacrifice part of their independence in alliance strategy to exchange for the financial and network resource of their large partners. Using a data of Japanese small-and medium-sized trading companies, we find that allying with Sogo Shosha(general trading companies) enable those smaller firms to expand fast to foreign markets and form alliances with industrial firms that are affiliated in large business groups. But such alliances constraint small firms in partner selection and modify their trajectories of international expansion.

Sogo Shosha's Iron Ore Buisiness

Sogo Shosha's Iron Ore Buisiness

A Study on the overcome of crisis of the from 1990s to Recently Japanese Sogo Shosha(GTC) -A mainly case of Mitsubishi Shosha in the long recession-

A Study on the overcome of crisis of the from 1990s to Recently Japanese Sogo Shosha(GTC) -A mainly case of Mitsubishi Shosha in the long recession-

Recent changes in the Japanese wholesale system and the importance of the Sogo Shosha

Interest in Japanese distribution as a field of academic study has waned in recent years, but there is a continuing interest with the activities of Japan's general trading companies or Sogo Shosha. Previous research has concentrated largely on their function as international trade intermediaries but it has overlooked their role in the domestic economy. In recent years, the same Sogo Shosha have expanded their involvement in domestic distribution, in particular into food wholesaling, but more recently into retailing. The aim of this paper is to explore the extent of this involvement and to present an analysis of the reasons behind such a shift from both a managerial and a theoretical perspective. Further, we look at the current and future consequences of such large, internationally powerful companies taking a significant share in domestic distribution in Japan.

Profitability of Japanese Manufacturing Subsidiaries in China

The purpose of this paper is to examine the relationship of firms' ownership advantages, internal advantages, and entry mode to the performance of Japanese overseas subsidiaries in China based upon eclectic theory of Dunning. By using 146 Japanese manufacturing firms, we found that ownership advantages, internalization advantages, entry timing and entry experience to Hong Kong have positive relationships on profitability. However, we conclude that entry mode and capital participation by Sogo Shosha have no relationship on profitability.

Governance, control and coordination in network context: the cases of Japanese Keiretsu and Sogo Shosha

Abstract This paper examines the arguments raised by scholars on the comparative advantages of the stock-market capitalism and Anglo-American ‘shareholder’ system for corporate governance and the ‘relational-insider’ system of the welfare capitalism in Germany and Japan, and whether the ‘superiority’ of the former may be based on false assumptions of the sources for productivity growth and managerial efficiency. It is an established fact in the literature that specific governance relations exist in different markets, and the mechanisms for financing and co-ordination of business operations and control of assets and resources are shaped by the local institutional environment. The modern corporation in its present organisational form is a multinational enterprise that in most cases controls assets in multiple markets, and is therefore tied in contractual relationships with local governments, suppliers, customers, and institutions beyond the reach of its home governance structure. The adversarial competitive relationships in one market are not replicated in another, where different context of the competitive environment applies. The paper offers two cases of corporate networks (the Japanese Keiretsu and Sogo Sosha ) that differ from the multidivisional form (M-form) of organisation. The analysis of the cases tests some of the premises established in the corporate governance debate and leads to conclusions that governance, control and co-ordination mechanisms focused on interdependent relationships and optimisation strategies generate a specific advantages in the value-creation process.

Shrinking Presence For Sogo Shosha

In past decades, Japan's general trading companies, or sogo shosha, have played an important role in the development of the Asian chemical industry. Over the past year or so, several of them have shown signs of financial weakness. The trading companies' presence in Asia's chemical industry is pervasive. For several of them, the sales of their chemicals business, which consists mostly of trading commodities, is larger than that of Japan's largest chemical firms. They own equity stakes in dozens of chemical projects across Asia. Although their investment in such projects tends to be limited to less than 10% of the equity, the minority stake is misleading. The shosha often take a central role in getting projects moving: They secure lenders, may guarantee the debt of the project, sometimes lend money to other equity investors, secure raw materials, manage the sales channels, and provide the equipment and technical expertise required to run the projects. Many of ...

A Comparative Study of the Economic Activities of Sogo Shosha in the United States and Canada in the early 1990s

The purpose of this paper is to clarify economic activities and strategies of sogo shosha, that is, the nine largest Japanese general trading companies, in response to different markets, namely the United States and Canada, during the early 1990s. This was a crucial period, due to the commencement of the North American Free Trade Agreement and the bursting of the Japanese bubble economy. The paper focuses on the characteristics of Japanese trading and investment patterns during the period in question, with particular attention to the activities of sogo shosha, in order to understand their current economic activities in North America. The American sogo shosha emphasize both offshore trade and domestic trade in the United States. The Canadian sogo shosha largely depend on the bilateral trade between Canada and Japan. Sogo shosha investment in the United States was more market-orientated, while that in Canada was more resource-oriented. The paper also includes exploration of the locational and functional implications of branches of sogo shosha. By changing their organizational operations and with concomitant functional changes in branches, four sogo shosha in the United States have pursued the localizing business strategies, while their counterparts in Canada have remained closer to the trading prototype. The examination of the different trading and investment patterns of sogo shosha in the United States and Canada reveals that they have recognized the United States and Canada as two distinct markets. It also shows the economic environments of the host and home countries have affected the economic activities of sogo shosha in North America.

戦前期フランス三菱の経営活動

The foreign activities of sogo shosha (general trading companies) like Mitsubishi-Shoji have been little researched. This article seeks to clarify one of the oversea's activities of Mitsubishi-Shoji. The history of the Paris branch is analyzed and described based on internal documents of the branch kept at the Archives du Monde du Travail in Roubaix and the Mitsubishi Economic Research Institute in Tokyo.The History of the Societe Anonyme Francaise Mitsubishi (S.A.F.M.) can be divided into four periods : first period, 1924-1927; second period, 1928-1932; third period, 1933-1938, and fourth period, 1939-1944.During the first period, S.A.F.M. invested in the Dewoitine Aircraft company, but this French company failed in 1926.During the second period, S.A.F.M. attempted diversification of goods for import and export. It left the aircraft industry and succeeded in dealing in agricultural products and other foods. During this period, in order to pay off the deficit caused by the failure of investment in Dewoitine Aircraft, S.A.F.M. pursued a policy of rationalization.It was during the third period that the efforts of saving and rationalization reached a peak. Many employees were discharged, and the Casablanca Office closed. Documents show that during this period S.A.F.M. was interested in Manchurian affairs.During the last period, 1939-1944, the occupation of France by the German army brought about the final decision. S.A.F.M. was closed in permanently in 1944. And in 1960, the newly organized Mitsubishi-Shoji was opened, but this in another history.An English translation of this article will be published in Japanese Year Book on Business History in 2001.

Diversification Strategies of British Trading Companies: Harrisons & Crosfield, c.1900–c.1980

This article examines the diversification strategies and organisational competencies of Harrisons & Crosfield between 1900 and 1980. This firm was of the largest ‘agency houses’ in Southeast Asia and one which had played a prominent role in the development of the Malayan rubber industry. By the 1970s Harrisons & Crosfield resembled a sogo shosha in terms of its product and geographical diversification. This diversification was incremental, and often driven by risk reduction as well as by a culture open to new opportunities. Competencies were tacit and evolutionary. Diversification strategies were also sustained by learning from other firms, either by acquisition or joint ventures.

Political economy of Korean and Japanese foreign direct investment

This article challenges a popular assumption that Korea has been refining and perfecting the Japanese foreign direct investment model. In the case of Korea, the pattern of overseas expansion of smaller companies is quite unlike that for smaller Japanese companies. In the former case, the move overseas is quite independent and related to the needs of the individual concern or entrepreneur while the latter usually moved offshore in tandem with larger companies and as part of their sub-contracting networks. Given this premise, major mechanisms behind the successful development of Japanese FDI in comparison with those of Korea will be examined. These include a) the role of the trading companies (sogo shosha), b) the role of the small and medium-sized firms, and c) the patterns of institutional linkages between government and business in the progress of FDI. This cross-examination demonstrates that Korea's trajectory and its dynamics are different from those of Japan, thus Korea's future cannot be predicted by simply looking at Japan.

The influence of sogo shosha companies on contract bargaining in the Pacific metallurgical coal trade

The role of trading companies has been held by many economists to be that of reducing transaction costs between buyer and seller. This article examines the influence that Japanese general trading companies, known in Japan as sogo shosha, have on contract bargaining outcomes between buyers and sellers in the trade between the exporters of Australia, and Japan, the world's largest importer of metallurgical coal. Propositions that sogo shosha companies have played a differential role, influenced by factors peculiar to Japanese business culture, are examined in light of econometric modelling findings suggesting distortions in Pacific metallurgical coal markets. The veracity of the propositions is also explored by a survey of the literature and management opinion amongst coal exporters from Australia and Canada. Implications with respect to foreign ownership policies and countervailing contract bargaining strategies by Australian exporting interests are then explored.

‘From Noodles to Satellites’: The Changing Geography of the Japanese Sogo Shosha

The need for a less occidental approach to understanding organizational‐geographical change is increasingly accepted. However, there is a danger of replacing one stereotype with others drawn simplistically from alternative capitalisms. In this paper we use the Japanese general trading company ‐ the sogo shosha ‐ as an example. We show how their city‐based, international networks evolved over a long period of time and, through a detailed case study of the sogo shosha in Europe, how their organization and behaviour need carefully to be interpreted.

Americansogo shosha:American trading companies in the twenty‐first century

Japanese General Trading Companies orsogo shoshashave been instrumental in the phenomenal Japanese economic miracle of the last 40 years. In 1982, the USA passed the Export Trading Company Act to home grow its ownsogo shoshas; to date the Act has been ineffective ‐ yet the need remains. Examines what trading companies are and what functions they perform. Observes the steps that need to be taken to make them profitable and successful. Postulates that trading companies are an integral part of this country’s future.

The Evolution of International Business: An Introduction.

1. Multinationals: Theories and Concepts 1.1 Issues 1.2 Definition 1.3 Theories of the Multinational Enterprise 1.4 Entrepeneurs, Firms, Hierarchies and Networks 1.5 The Organization of MNEs. 2. International Business in the World Economy 2.1 The Environment of International Business 2.2 Origins before 1880 2.3 Growth 1880-1930 2.4 Alternatives to Multinational Enterprise 2.5 Resurgence 1950-1980 2.6 Global Business. 3. Multinationals and Natural Resources 3.1 International Business and Natural Resources 3.2 Origins and Growth 3.3 Determinants 3.4 International Collusion 3.5 The Growth of Large Integrated Firms 3.6 New Entrants and the Decline of Integration. 4. Multinational Manufacturing 4.1 International Business and Manufacturing 4.2 Origins and Growth 4.3 Determinants 4.4 The Interwar Cartels 4.5 Renewal and Growth 4.6 Global Integration and Networks. 5. Multinationals and Services 5.1 International Business and Services 5.2 Origins and Growth 5.3 Determinants 5.4 Equity and Non-Equity Strategies in a Regulated Environment 5.5 Sogo Shosha 5.6 Multinational Banking. 6. The Competitiveness of Firms and Nations 6.1 Comparative Home Economies 6.2 The Home Economy Impact on MNEs 6.3 MNEs and National Competitiveness 6.4 Policy and Outward Investment 6.5 The End of Nationality? 7. Multinationals as Engines of Growth 7.1 Comparative Host Economies 7.2 The Impact of Host Economies 7.3 Resource Transfers 7.4 Trade 7.5 Market Structure and Linkages 7.6 Sovereignty and Culture 7.7 Host Economies over Time. 8. Governments and Multinationals 8.1 Policy and Inward Investment 8.2 Governments and MNEs in Developed Economies 8.3 Japan and the MNEs 8.4 MNEs and Governments in Developing Countries 8.5 Comparative Host Governments: India, Brazil and Singapore since 1950.

一九五〇年代の三井物産の総合商社化

The general trading company, Sogo Shosha, is usually defined as “a firm that trades all kinds of goods and services with all nations of the world.” The emergence of the Sogo Shosha in Japan has been heavily written about from different perspectives. Some used models to focus their attention on the internal organizations and management policies. Some stressed the importance of economic circumstances in Japan.In this paper, I explain the formation of the general trading company from the perspective of customer relations. I did a case study on Mitsui Busan (Mitsui Co. Ltd), one of the biggest Sogo Shosha in Japan.From the information I gathered from Mitsui Busan, I have focused on their customer relations around 1959. From there, I have grouped the major customers, who have business dealings of more than ¥0.5 billion a year with Mitsui Bussan, into Mitsui Keiretsu, non-Mitsui Keiretsu, and subsidiary companies. I discovered that Mitsui Bussan's transactions with its major customers were consistent and that they covered a very wide variety of goods and services. It was also discovered that Mitsui Busan had very specific product dealings with specific groups of customers. The formation of Mitsui Busan arose from the transaction and relations with its customers, and thus formed a heavily dependent customer network.In conclusion, the most important factor was their tightly-knit customer relations and network with all its customers. It is a misconception that Mitsui Busan only had strong relations with the Mitsui Group. In actual fact, non-Mitsui Group customers were as highly valued as those from the parent group. Therefore, in analysing the emergence of Sogo Shosha in Japan, it is best to look at the customer relations and network of the Sogo Shosha.