Eight Tool Co., Ltd.: Precision-Crafted Japanese Tools Driving Global Manufacturing Excellence

The Japanese spirit of monozukuri has traditionally been about pursuing perfection through craftsmanship. Today, it also involves meticulous attention to detail and responsiveness to customer needs. As a manufacturing company, how would you define the strengths of Japanese manufacturing and its spirit of craftsmanship?

Monozukuri in Japan has been passed down through generations. While our company utilizes machines for production, our strength lies in achieving precision through manual craftsmanship. Japanese manufacturers are known for their meticulous attention to detail and dedication to quality, and I believe this is clearly reflected in the products they create.

Looking at the current landscape, both in Japan and globally, we’ve seen major disruptions—from the COVID-19 pandemic, which put significant pressure on global supply chains, to ongoing geopolitical tensions between China and the U.S., creating uncertainty. Japanese companies are well known for their craftsmanship, and their products are highly regarded internationally. Additionally, with the fluctuation of the JPY, Japanese goods have become more cost-effective for international buyers. Do you see this situation as an opportunity or a challenge for Japanese companies looking to expand their sales globally?

I agree with your opinion. With the current trend of price increases in every Japanese industry, the cost of raw materials is increasing in Japan, as are workforce costs. Therefore, our challenge is to produce high-quality products at lower costs. We have continued to review our entire production process, not only procurement but also factory management, to improve our cost efficiency. As we have been, we will continue to be committed to manufacturing reliable, high-quality products for competitive price points. The fluctuation of the JPY on the other hand is definitely an opportunity for our international customers. We think companies that wish to expand their international markets, including ourselves, need to utilize this momentum not only with products’ quality but also cost efficiency.

One of Japan’s biggest challenges is its demographic decline. With one of the oldest populations in the world, the domestic market is shrinking, and labor shortages are becoming more severe. By 2040, Japan is projected to face a shortfall of over 10 million workers. For your company specifically, how are you addressing these challenges? What solutions are you implementing to adapt to this changing landscape?

When it comes to recruitment, we are fortunate to be able to continue hiring young talent and have very low employee turnover. We also provide an environment where senior employees can continue working comfortably well into their seventies and even eighties. Creating this kind of collaborative workplace is one of our key solutions to addressing Japan’s shrinking workforce.

Additionally, we are incorporating automation into our operations. In the future, our goal is to implement more machines on our production lines, allowing a single worker to oversee multiple machines. This will enable us to maintain and enhance efficiency while reducing the need for a large workforce to meet increasing demands.

With the COVID-19 pandemic, online ordering became more common, with many people associating it primarily with clothing or food delivery. However, even in the manufacturing industry, there is growing demand for fast and convenient online purchasing. Your company has embraced this shift by establishing its own e-commerce platform, allowing customers to buy your products directly. What have been the key benefits of your online presence so far? Do you see this as an opportunity to expand sales into new markets in the future?

While we have our online store for domestic market, we have always prioritized working with our distribution partners to offer our products on various online platforms, both in Japan and overseas. Online platforms have been great assets for our customers not only to promote our products but also to digitize and simplify some traditional sales procedures, such as issuing paperwork and keeping track of them. As a small manufacturer, being visible at various online platforms all over the world is a good promotion by itself. We will continue to work with our customers to enhance our visibility and address our focus on product quality through creating more content that showcase our brand online.  

How challenging is it for SMEs like yours to maintain the right level of inventory? In my previous job, I worked in a warehouse, and one of the biggest challenges was ensuring we had enough stock to fulfil orders without overstocking and taking up valuable space. What solutions do you have in place to manage your inventory effectively?

Originally, we did not have a robust system in place for inventory management. However, about four to five years ago, we introduced an integrated inventory management system that covers both production and sales. This allows us to visualize inventory levels at different stages of the process. Our sales and production teams work together to create demand forecasts, which guide our production planning.

This approach also applies to our overseas operations. In the past, lead times for international markets were quite long, but we have managed to shorten them over the years. As a result, forecasting has become both more challenging and more crucial. Drawing from our experience, we strive to make accurate forecasts to ensure we can plan effectively and meet demand efficiently.

Your company was founded in 1958 and is approaching 70 years of history. Over the decades, you have grown into a specialized manufacturer of hand tools and hexagon wrenches. As you mentioned, you have refined your management system, enhanced your production capabilities, and expanded by opening multiple factories. Could you share some of the key milestones in your company’s history and how your business has evolved over nearly 70 years?

We were founded in 1958 and began producing hexagon wrenches in 1965, marking 60 years of manufacturing this product. In 1977, we introduced ballpoint hex wrenches, expanding our product lineup. By the 1980s, we had begun procuring specialized materials, leading to the launch of our premium Excellent series in 1987. Today, we offer a diverse range of hex wrenches to meet various needs.

In terms of production, we opened our first Tottori factory in 1989, followed by a second in 1990 and a third in 1994. Most recently, in 2023, we launched our fourth Tottori factory, further strengthening our production capabilities.

To expand our global presence, we established our U.S. subsidiary, Eight Tool America Inc., in 2018 to increase brand awareness in Western markets. In 2021, we obtained ISO certification, enhancing our systems to build greater customer trust. Last summer, we launched our new EX-IMPACT BIT series, and we are actively working on expanding this lineup.

Many companies are shifting production overseas to reduce labor costs. However, as you just mentioned, your company remains committed to Made in Japan and has been expanding production domestically. How important is maintaining Made in Japan manufacturing for your company? What are the key benefits of keeping your factories in Japan, and how does this differentiate your products in the market?

We are committed to continuing Made in Japan production in the future. However, not all of our manufacturing is handled solely by Eight Tool—our partnerships also play a crucial role. Over the decades, we have built strong relationships with our partners, allowing us to continuously innovate our production processes. We openly discuss which products to develop and how we can improve manufacturing, with the goal of growing and evolving together.

Collaboration is essential, and we value customer feedback through our partners. We prioritize incorporating end-user opinions into our production, ensuring that our products truly meet their needs. As a specialized manufacturer of hex wrenches, our expertise is unmatched, and approximately 10% of our sales come from custom-made, special-order products. This ability to offer tailored solutions is one of our key strengths.

You just highlighted the importance of partnerships in your business. What is your strategy for identifying the right partners? Do you actively seek out companies that share your values, or do you wait for potential partners to approach you? Looking ahead, are you planning to expand your partnership network, both within Japan and internationally?

When it comes to monozukuri, we prioritize partnering with local companies as physical distance is important in terms of logistics. This is partly to ensure shorter delivery times, but also to maintain the high standards associated with Made in Japan.

In terms of distribution / sales partnerships, we take a flexible approach—sometimes companies approach us, while other times, we reach out to companies through our own researches or referrals.

Collaborating with overseas companies is also important. We are fortunate to have partnerships abroad and hope to expand further with companies from around the world. We are very much open to our partners’ feedback both in Japan and from overseas, as our top priority remains maintaining the highest quality products that meets our customers’ requirements.

You mentioned that 10% of your sales come from special-order products and that your company possesses unique skills that set you apart. Could you share an example of a special order where a company approached you with a problem that only you could solve?

We received a special order from an international customer who needed to access screws without disassembling a particular machine. The tool we developed for them measured 1 meter in length to reach the screw. This is a prime example of the kind of unique, custom-made solutions that set us apart and showcase our expertise in specialized tool manufacturing.

We know that you recently launched your new EX/IMPACT series, made with a special alloy steel that is highly durable and wear-resistant. This series was designed not only to enhance longevity but also to reduce cavitation and increase torque. Could you share more details about the EX/IMPACT series and the specific customer demands that led to the development of this new product line?

While we are a specialized manufacturer of hand tools, especially hex keys, we also have had a few bit tool lineups and have witnessed the growing number of inquiries for bit tools with higher torque performance, greater longevity, and reduced cavitation. Customers specifically requested solutions addressing these needs, which led our R&D department to dedicate significant time and effort to developing this product.

After extensive research and testing, we launched the EX/IMPACT series. We believe this lineup gives us a strong competitive advantage in terms of performance and durability.

What specific heat treatment processes or materials are you using to enhance longevity and improve torque performance in your tools? How do these innovations help address the challenges associated with wear resistance and durability?

For our hex key and other hand tool products, we use a specially developed material called SNCM+V, which we co-created with a domestic steel manufacturer. This material realizes the ideal balance of hardness and torsional strength that is required for hex keys and hand tools. When it comes to bit products that are used with impact, power, and /or air tools, the quality of material required is significantly different from the one for hex keys. After years of researches and trials, we landed on our Impact-Guard Alloy material, which achieves exceptional durability against instant impact and hight torque.  

In terms of heat treatment, we have gone through extensive trial and error, until we finally identified the ideal temperature settings to achieve the best possible performance. Although hex keys and driver bits may seem to be similar products within the large “tool” category, we consider the materials and engineering behind them should be entirely different, reflecting the distinct demands of each tool.

Are there any new technologies or products currently in development that you can share with our readers? Additionally, how do your partnerships help you better address customer needs in R&D and product design?

When it comes to the strengths of our products, I believe durability and precision fitting are key factors. These qualities define our tools and set them apart.

Our current product lineup is just a portion of what we aim to achieve. As a company, we are focused on expanding our bit tool offerings in the future to further enhance our product range and meet evolving customer needs.

In our previous interview, you mentioned expanding your production capabilities by investing in new machinery for your fourth factory and strengthening collaboration with your partners. Maintaining consistent quality across multiple production sites—whether within your own factories or through partner facilities—can sometimes be a challenge. How do you ensure consistent quality across different production locations? Additionally, how has your investment in new equipment since our last interview improved production efficiency across your factories?

Although it is impossible to create identical environments across all production sites, we believe that similar conditions can be established. We achieve this by sharing the details of our monozukuri and production processes with our partners, ensuring they align with our standards. By working closely together, we maintain consistency and quality across all facilities.

With our fourth factory, we have not only expanded our production capacities but also extended our capabilities. One of the functions we introduced was an equipment for removing distortions in bits. Precision is critical—bits must have an absolutely straight line, as even the small distortion can create major issues. To address this, we have implemented a sensor system that automatically corrects alignment. I believe this technology will be essential for our future production.

We know that your company is not solely focused on the domestic market, as you have established a U.S. subsidiary and supply products to countries like India. Could you share more about your international strategy? Which countries or markets are you prioritizing for expansion in the coming years?

We are looking to explore opportunities in various regions around the world. While we have built great partnerships with international customers in many countries, our goal is to expand further wherever there is demand—whether in Europe, Africa, or other regions.

Do different regions have varying requirements for your products? If so, how do you tailor your strategy to meet the specific needs of each market?

The level of industrial development varies by country, so we must carefully analyze and determine the specific needs of each region. With our diverse product lineups, we tailor our approach by selecting the most suitable lineup for each market. In some countries, we promote our premium Excellent series, while in others, we focus on our standard product lines.

To make these decisions, we conduct thorough market analysis and closely listen to feedback from our partners. If necessary, we are also capable of developing new products to meet unique regional demands.

Your company will be celebrating its 70th anniversary in 2028. If we were to return for another interview in three years, what specific goals or ambitions would you like to have achieved by then? What milestones do you hope to share with us as you approach this significant anniversary?

As a company specializing in screw-turning tools, our goal is to expand beyond the hex wrench category and develop products for turning other types of screws as well. Currently, we have around 2,000 products in our catalog, but our focus is on continuously improving each one to better meet customer needs. We place great importance on this ongoing evolution.

Additionally, we want to enhance the working environment for our employees, ensuring they can continue their careers with us for many years. These are the key goals I hope to achieve in the future.

For more information, please visit their website at: https://www.eight-tool.co.jp/