Let’s mine treasure in Japanese SME


According to the METI (Ministry of Economy, Trade and Industry), 99.7% of registered business offices in Japan are SME.  The definition of SME varies depending on the governmental jurisdiction like industrial support/subsidy/incentive, welfare/labor or taxation, but normally we follow the Small Business Administration’s following category:


Type of the business         SME’s category                                             Small business


Manufacturers,                Paid-in capital is 300 Mil yen or less, or     

Constructors,                   the number of employees is 300 or less        20 or less

Transportation etc.


Wholesaler                       Paid-in capital is 100 Mil yen or less, or

                                          100 employees or less                                         5 or less


Service                             50 million yen or less, or

                                          100 employees or less                                        5 or less


Retailers                           50 million yen or less or

                                          50 employees or less                                          5 or less


Unlike the big names like Toyota, Honda, Hitachi, Panasonic, Mitsui, Mitsubishi, Sumitomo - - -, not many SME names are known to the world, yet there are many world number 1 companies in terms of the share of supply chain for auto and telecommunication industries.

They do not seem to care much about scaling up their business, but to stick to evolving their own technology, skill or services through R&D, future trend reading, or researching/introducing other blood (cultures) so that they stay in business for next generations.

But when they are compared with American small start-ups, they tend to lose luster because such American start-ups are more innovation oriented and fast growth (exit) oriented like IPO or M&A. 

Those American start-ups’ founders know what should be the treasure they should develop, create or hunt so that the start-ups with the treasure can be immediately and highly appreciated by the world market.

On the other hand, some of the Japanese SME who have outstanding products, technology, services or contents do not know what kind of impact their local breakthrough could bring to the world because they are too much absorbed in the subject of matters within their imagination, and they do not research or extend their consideration of what sort of applications could be possible beyond the horizon.

They continue to make things finer, lighter, thinner, or durable, or make their services more surprising beyond customer expectation.

For example, Juken (http://www.juken.com/), a plastic injection molding company has been developing and producing plastic precision parts by injection molding for various applications.  Without having specific applications, the company has been challenging to make parts precise and smaller and for now, its representative prototype is a very small gear, called a powder gear, which weighs only one millionth of a gram.

I think it is not generated by an extension of the past production technologies, but by a new approach (innovation).

What those SME might need, I think, may be foreign promoters, who can identify applications of such ore of treasure, create business plan of how to polish it to be real treasure and establish channels to the world market to materialize the potential value of the treasure.


If you are interested in mining such treasure in Japanese SME, please let me know!