Hikari Miso's products are naturally wholesome, deliciously flavorful, and exceptionally healthy, giving international and domestic customers a taste of real Japanese cuisine.
For 11 consecutive years, Japanese food-related exports have registered record-breaking numbers, reaching JPY 1.45 trillion in 2023. This trend is also reflected on a global scale, with the number of Japanese restaurants overseas tripling over the past decade from 55,000 in 2013 to nearly 200,000 today. How do you account for the continued rise to record-breaking levels of Japanese food exports as well as the growing popularity of Japanese cuisine overseas in recent years?
As you mentioned, Japanese companies are trying to increase the export of Japanese food or washoku. Going forward, one of the main reasons for this will be Japan’s decreasing population. While it has not been a major factor until now, the declining number of people per household in Japan will force Japanese companies to increase their exports further as the domestic demand for washoku and, in our case, miso will decrease. As you can imagine, a husband and wife who are busy working may not have many opportunities to have a meal together. They, therefore, do not cook miso soup in a big pan for the family as they are eating alone. Meanwhile, demand for instant miso soup is increasing. That is one reason why the miso business is shrinking. It is also an issue for all the other food businesses in Japan. Added to the reduced number of people per household is the increase in the aged population. Also, as people spend more time working, they spend less time grocery shopping and cooking. These are the factors that are leading to the shrinkage of the food market in Japan.
Japanese people are aware and understand that washoku is good for people’s health. However, despite that understanding, the reality is that Japanese people wish to consume more Western foods. For instance, the biggest food business in Japan by far is McDonalds. Starbucks is also rapidly increasing its number of shops in Japan. This is leading to an increase in demand for dressings such as mayonnaise or other Western-style food and a decrease in demand for miso, soy sauce, and other traditional Japanese seasonings. That is how I see the market right now.
When we spoke with Japan’s most famous Umeshu drink maker, Choya Umeshu, they spoke about the differences in the age groupings, with the older population having a greater appreciation for Umeshu culture. On the other hand, they told us that the younger population requires a little more convincing about the benefits of their products and how their link to Japanese heritage and culture is something they should appreciate. Do you see the same parallel with miso? Is there a need to convince younger consumers of the benefits of your products?
Yes, this has been the case, especially in the past five to ten years. A better understanding of fermented foods as a core part of Japanese food culture and the history of washoku is required. Its consumption leads to a better diet and better guts conditions. Even the younger generation is beginning to realize this as they are trying to change their eating style and diet.
Japan’s food sector faces significant challenges, including a declining and aging population, which is particularly evident in rural area like Nagano prefecture , where the average age exceeds 65 years. For Hikari Miso, this aging and shrinking agricultural workforce poses supply chain concerns, such as potential production bottlenecks for essential ingredients like soybeans and rice. Additionally, the declining population contributes to a shrinking domestic market, as you mentioned earlier. How are you addressing these challenges, and do you see any new opportunities in this situation, particularly abroad?
I do not think we need to change our company’s direction suddenly to cope with the challenges you have mentioned. Over the past 20 years, we have been focusing on the globalization of Hikari Miso. It is not only a matter of trying to export more miso to the rest of the world. Rather, globalization for us involves importing the ingredients that we require more aggressively from overseas. It also involves welcoming more people from outside of Japan to work for us. We must change the way we do business to meet the demands of globalization. I encourage all our managers and employees to not focus solely on what is happening in Japan but also focus on what is happening outside of Japan.
While doing business, the Japanese way should remain part of our core. However, it should not be everything. We must also accept “globalization” and do business that effectively fits into the American way as well. Historically, the US gained control of how business was done all over the world because of both of the World Wars. We must accept and follow the way they do business. This involves changing how we conduct our own business, as that will lead to business success outside Japan as well. This is especially the case for us as our international business is very much focused on the North American and European markets. We must accept how business is done in those regions. That is the basis of how I have been managing Hikari Miso for the past 20 years. In the past 5 to 10 years, I have had to accelerate that direction, as I cannot maintain the company by only doing business in the Japanese way.
Hikari Miso was established in 1936 in Shimosuwa, Nagano Prefecture, an area renowned for its pristine environment and ideal conditions. Starting as a small producer of traditional miso, the company has grown into a global leader known for its high-quality, organic, and additive-free miso products, with customers in over 50 countries around the world. How has your business evolved over the years, and what competitive advantages have you developed in miso production over your nearly 90 years of history?
There are many miso companies with histories dating back over a hundred, two hundred, or even three hundred years. Hikari Miso is one of the youngest miso companies in Japan, and it has only been around for 90 years. That means that we must always be aggressive when trying to gain new business. We cannot follow what the other miso brands are doing and must differentiate ourselves from our competitors. For instance, we were the first miso company in Japan to secure private-label miso orders. At that time, the biggest supermarket chain in Japan was Daiei. They approached us to supply a large amount of miso to them, which continued to grow year by year. It was a huge business opportunity for us, and that is what triggered our expansion strategy.
When I joined the company, I considered how I could differentiate myself and Hikari Miso from the other miso manufacturers and their presidents. Previously, I worked at Epson for 12 years in their international sales department. That included five years working in the UK and one year in California. At that time, Epson had a reputation as a successful international company. I remember they showed a picture of Mr. Hattori, the president of Epson, on the first page of BusinessWeek. This improved his reputation as a successful international entrepreneur, following in the footsteps of Mr. Morita of Sony Corporation. When I worked in the UK, I was not encouraged to have an interpreter, and when managers from our Japanese office came to the UK, they were forced to give their presentations in English regardless of their English language ability. I had to do the same thing and was one of only five Japanese staff out of a total of 200 staff in the UK. I was required to speak English all day long and only spoke Japanese to Japanese HQ on the telephone.
When I joined Hikari Miso, I wanted to make good use of my international experience from my time at Epson. I began dealing with soybeans suppliers from the US and Canada. I traveled to the US and Canada by myself and met with the suppliers. It was very successful, as we were able to competitively source soybeans. I also did the same for rice. When I became president, I decided that I wanted to continue working internationally, and we began to explore the international market and increase our miso exports. There were some hard times in the past 15 years. However, I spent a lot of time and money cultivating our international miso export business. Our international sales department staff are very active and quick to react to the customers' demands. For example, they introduced a separate product range from our Japanese product range for the international market, including organic miso. That was how we were successful in increasing our market share in the US. We then increased our market share in Europe.
We want to have as many customers as possible outside of Japan. Going forward, we plan to increase the number of new products and our overseas market share. Those are the main driving forces behind our overseas success, and we are now very happy with our overseas sales revenue and profit margin.
Demand for organic products globally has been increasing as consumers become more health-conscious about the foods that they consume. Demand varies by region, but the US is a significant opportunity for this. Your company distinguishes itself as the world’s leading producer of organic miso, offering an impressive array of products, including Organic Miso White and Organic Miso Aged Black. Some of your products are vegan, some are kosher certified, and some are halal certified. You reach a wide international audience with exports to over 50 countries. What are your most popular organic miso products, both domestically and abroad, in the US?
When it comes to the Japanese market, our Kodawattemasu Organic Miso is the single biggest organic miso product. It has been on sale in the Japanese market for more than 30 years. Before I joined Hikari Miso, that product was being exported to the US market in small quantities and could be found in New York grocery stores.
In terms of the overseas market, we sell many different organic miso products. Our Organic Miso Whiteis the most popular organic miso in the US market. We also have a European version of this product in multiple languages. It has a good balance of umami, saltiness, sweetness, sourness, and bitterness. This product is not only for miso soup. People in the US, Canada, and Europe also use it to make miso dressings and miso marinade.
More than 50% of the overseas demand for miso is for white miso products rather than red miso. In Japan, on the other hand, people prefer red miso. There are distinct differences in the taste preferences of our overseas customers and our Japanese customers.
We would like to ask you about the health benefits of miso. When we interviewed Maruhachi, they spoke about their dashi being a substitute for many Western-based soups and stocks. We know that Western food has a very high salt content, and right now, there is a diabetes epidemic in the West. Maruhachi told us that dashi is a much healthier alternative that could be integrated into local diets either by local chefs updating their recipes or by consumers becoming more aware of it. Could you explain the health benefits of miso to our readers?
Dashi and miso have slightly different backgrounds. If you have soup or food containing dashi, you will be happy with the umami flavor that comes from the dashi. It also means that you are fine with a reduced sodium content. If food or soup contains a lot of salt or sodium, it is considered tasty. However, people are being encouraged to reduce sodium consumption. That is why dashi is a good solution for reducing the amount of sodium they are consuming. Also, dashi has a nice aroma, encouraging people to have a bigger appetite. That is why dashi is popular.
Miso, on the other hand, is a fermented product made using koji, which is the source of its health benefits. Koji is used to make miso, soy sauce, and sake, for instance, and is, therefore, at the core of Japanese food culture. Koji itself is a fungus or mold, named as “Aspergillus oryzae” unique to the Japanese industry. Overseas, they refer to koji as cultured rice. When it comes to its health benefits, koji generates active enzymes. For example, it generates an enzyme to break down protein into amino acids. Miso itself contains amino acids from umami as well as peptides that have many health benefits, such as reducing blood pressure and helping people calm down. Soy sauce, on the other hand, does not contain peptides. Tofu, for example, does not contain amino acids or peptides but only proteins. That is why miso is unique. It not only contains amino acids, but it also contains peptides. They are the unique health benefits of miso.
Miso is salty, having a sodium content of around 10%. However, it also contains different tastes. For example, one miso may have a bitter taste, while another, such as a white miso, may be sweeter. Miso has five flavors. They are umami, saltiness, sweetness, bitterness, and sourness. Those five elements give miso a very complex taste profile. That is why miso is so unique, and restaurant chefs have realized how good miso is for adjusting or differentiating the taste and aroma of each dish.
The use of carefully selected ingredients is naturally a top priority for consumers. Your company incorporates three main types of soybeans in its products: domestically grown soybeans, non-GMO soybeans, certified organic soybeans. How do you select where you source your ingredients? What is it about your partnership network that allows you to not only acquire the ingredients you need in Japan but also overseas as well?
As you mentioned, all our miso is made from non-GMO soybeans. Around 25 years ago, a giant American chemical company introduced Roundup Ready, launching specific soybeans and pesticides. Farmers bought those two things together, improving farming efficiency. However, I had the chance to visit US and Canadian farmers who were harvesting GMO soybeans. The soybean fields were covered by a whitish powder due to the pesticides and it did not look natural. While the pesticide manufacturers proved it was safe technically and theoretically, I did not believe it was something that we should be eating. In Japan, Miso soup is consumed every day. I did not want to feed my children miso soup and tofu made from GMO soybeans. All the Japanese food manufacturers decided against introducing GMO soybeans, and that has continued to this day. All miso production is based on non-GMO soybeans. While it may not be as efficient as GMO soybeans, that is the decision that we have made.
Japanese people strongly believe in domestic rice, soybeans, and vegetables as they are considered safe to eat. They are quite suspicious of imported foods. For me, this is only sometimes the case. However, as we need to capture those customers, we must respect their strong belief in ‘Made in Japan’ products. That is why we continue to produce miso using domestic rice and domestic soybeans. While the taste itself is better, the main challenge is the cost. Japanese farming is not at all competitive as there are large farmlands outside of Japan in countries like the US and Canada. However, we need to respect our Japanese customers and continue to use domestically grown ingredients.
When it comes to our differentiation strategy and finding customers outside of Japan, we strategically need to produce organic miso. Unfortunately, we need more capacity for us to rely on domestically grown organic soybeans and rice. It is almost impossible. That is why we decided to import organic soybeans and rice overseas. As I mentioned earlier, I personally visited many farmers overseas. For value-added miso like organic miso and premium miso, it is not only a matter of purchasing soybeans and rice based on the price. It is also not enough to base our purchase of ingredients on certifications, and I did not simply rely on or believe in paperwork. I wanted to visit the farms in the US, Canada, south American countries, southeast Asian countries, and China myself and meet the farm owners and the managers responsible for the certification procedures. I only decided to do business with those farmers when I was confident that they were honest people who were serious about developing a better organic farming business. That has continued up until now. I am very confident that our organic miso is perfectly safe and satisfies our customers without any doubt. We encourage ourselves to import our ingredients by our initiative along with trading companies.
Are you looking for any new overseas suppliers or distribution partners?
When it comes to procuring ingredients, we import them ourselves. However, we have established strong partnerships with overseas farming companies in which we have a mutual understanding and conduct face-to-face meetings and onsite visits.
We rely on Japanese or Asian distributors and importers in the US and Europe. We are very fortunate to have such strong relationships with our overseas partners in the US, the EU, and the UK. They are honest when telling us which miso is good, and which miso needs to be improved. Those people represent their market and are a great asset to our business. For example, we have a person in California who visits mainstream supermarkets. He always informs me about the types of miso that are good for the American people, and he advises us on how we can improve our products and what actions we need to take next. I also have some friends in the UK and the EU. The importers and distributors dedicated to organic business in those areas support each other. I am a part of that community, and that is one of our greatest assets.
According to the Ministry of the Environment, Japan saw approximately 5.23 million tons of food loss in the 2021 fiscal year. Addressing this issue, you have embraced circular economy initiatives by repurposing production with your Circulation-3R Model. Can you explain how this model achieves this? Can you talk about some of the initiatives you are undertaking to reduce food waste and improve your environmental performance?
The trigger point for our efforts to reduce food waste was when Hikari Miso became a member of a working group initiated by the largest supermarket in Japan. That supermarket has good connections and partnerships with giant overseas supermarket chains in the US and Europe. Most of those companies belong to the Consumer Goods Forum (CGF), whose offices are in Paris. One of their workshops focuses on the reduction of food loss. After being encouraged to join the working group, we learned how significant their food loss reduction exercises were outside of Japan and realized that it would also happen in Japan soon. That was why we decided to act. Since then, it has indeed happened in Japan, and many Japanese food manufacturers have acted.
Miso makes good use of natural ingredients. We do not waste soybeans, and the overall waste from the production process is minimal, unlike many processed foods. That is why I thought that there was no need to worry about food loss. However, when we learned what was happening outside of Japan, we checked every step of our production processes to find the idle time of our machinery when not producing miso.
Sometimes, our miso is returned by the distributor when the shelf life is close to expiring. That is something that we must accept. Even though it could be consumed without harm, we used to dump it, which, of course, was not good. We therefore decided to make better use of it by supplying it to organizations to help small children and people in need. Also, our factory is based in Nagano, a region with beautiful natural scenery. We wanted to contribute something to the local community, such as using the waste residue from our wastewater management system for soil conditioners. Local farmers near our factory make good use of it instead of chemical one to change the soil condition of the farmland, for example. While those actions are great, we need to do more to minimize food loss and extend the shelf life of some of our products. We were stringent and very conservative when setting the expiry date. For example, the expiry date was set at 6 months after the production date. However, we found that some of our products could be good for up to a year, so we redefined the best-before date and introduced this new definition to the marketplace in the Autumn of this year.
If we were to interview you again on the last day of your presidency, whatever that may be, what personal ambitions or goals would you like to have achieved that you could share with us on that date?
Everyone in the world is now talking about sustainability. We must accept that and drive our company in that direction, no doubt. However, we need to differentiate Hikari Miso from other miso brands. My goal is to produce more and more organic miso with a better taste and at affordable prices all over the world. I want to strengthen our company in that regard. To achieve that objective, I want to establish a worldwide alliance in which we can communicate with our partners and help each other to make good use of organic ingredients and manage supply chains.
There are miso manufacturers outside of Japan in the US, Canada, the EU, and Asia. However, we possess much better fermentation techniques, so I believe that we can help them. I envision collaborating for supply chain management and sharing fermentation techniques, production techniques, and manufacturing processes for this potential organic miso alliance. We want to connect with American and European companies to help each other supply consumers all over the world with very tasty miso at affordable prices and optimal safety and assurance. That is what I would like to achieve.
I know that I will be unable to retain my presidential responsibilities for another 20 years. I must retire sometime to make a generational change at the company. However, after I retire, I will need to do something different. I would like to help create this worldwide organic miso alliance. I want to drive its establishment.
For more information, please visit their website at: https://hikarimiso.com/
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