創業者ブログ

Don't exaggerate the importance of manufacturing industry
(Sep. 13,2007)

Tokyo is the political nerve centers of Japan. Tokyo is the symbol for the centralization of powers of Japan. Most of the main offices of listed companies are located also in Tokyo.
On the other hand, Tokyo calls out to rural cities, "Protect and foster the manufacturing industry." Can you prove the truth of Tokyo's claim about role sharing between the capital and rural areas? Many local government leaders, local assembly members, business managers of locally-based companies seem to naively believe in the truth of Tokyo claim without any evidence.
It is important to remember that manufacturing industry tends to go to law-labor-cost areas. Simply put, it passes into developing countries, where environmental problems are not taken seriously.
A few decades ago, Japan tried to become the world center of manufacturing. We were proud of Japan's status as a trading nation. However, we were also troubled with environmental pollution and hard-pressed to solve the problem. Now, we are in a position to furnish developing countries information on environmental measures. But, at the same time, we are no longer at the center of manufacturing; it moved to Taiwan and Korea, and then, to China. In the future, the outlying areas such as India, Pakistan, Bangladesh, and the other Asian countries will serve as manufacturing industry will play a role of world's factory.
In spite of this broad sweep of world history, Japanese government is still screaming the same old slogan, "Foster the manufacturing industry" and "Restore vitality to the local areas by fostering the manufacturing industry."
Recall what happened to the U.S. in the 80s. During this period, the U.S. suffered a recession. How did she climb out of it? It was by pulling out of manufacturing industry, concentrating the energies on financial services and IT industries, and fabricating what is called "global standard", which is actually quite favorable to the U.S., and enforce it to the other countries. Fortunately for the U.S., Japan made great efforts to adapt herself to this new "standard." As a result, Japan's financial system collapsed.
We should not be dazzled by the slogan from Tokyo, "Protect and foster the manufacturing industry." We should keep in mind that we are at great physical disadvantages inherent to provincials. All we can do is to rack our brains. It is nonsense for us to rely only on the manufacturing industry. Of course, manufacturing is important for the national economy. However, for local economy, it seems much more promising to develop new financial systems, IT technologies, new materials, new services. We should draw a moral from the innovation of the U.S. economy in the 80s.
The price of a Chinese-made dress shirt is about 1000 yen (8 U.S. dollars). However, if it is Japanese-made, even a short-sleeved shirt costs about 8000 yen. If it is a handsewn, the price is about 15000 yen (120 U.S. dollars). Furthermore, if it is the state-of-the-art tailor-made shirt of Japanese-make, it costs at least 30,000 yen (250 U.S. dollars). How do you think about this price difference?
Now, you must be aware of the importance of adding "something else" to the products. We should consider how the basic costs, designs, brand authority, channel of distribution, future possibility, etc. play significant parts in price-making.
We need to take into consideration the fact that the scale of credit economy is much larger than the actual economy is. This fact is closely related to the current expansion of the IT industry. I think that it is provincials who should be bent upon IT industry and financial business. The success of this syncretic business would be the platform for the future prosperity of the local economy. Unlike the manufacturing industry, you can do this new business even in the areas distant from Tokyo if you can set your wits to work.