Sato Seni values Japanese manufacturing in all their processes, from yarn making to final assembly, with a unique perspective and freefrom expression of ideas.
Japan has historically had a deep clothing culture. You have the kimono and yukata which are characterized by timeless lines that have gone through different eras and improvements through the centuries. Today, Japan is famous for its cultural heritage and craftsmanship. Japan has innovative designers such as Issey Miyake, high-quality textiles, and innovative technologies integrated into a well-supplied and automated supply chain. How would you define the uniqueness of the Japanese fashion and apparel industry, and from your point of view, how would you define modern Japanese style?
Until around 100 years ago, Japanese people wore the traditional kimono and yukata. It was only during the Meiji Period and after WW2 that Western culture poured into Japan. There was no wool culture in Japan before the advent of Western cultural influences. For 50 years, Japan tried to understand and capture Western and especially European interpretations of fashion. Based on their learnings, new fashion brands emerged, such as Issey Miyake, Comme Des Garcons, Yohji Yamamoto, and Kenzo. Kenzo has added new Japanese interpretations of colors to the fashion, while Issey Miyake took the kimono essence to make Western apparel. The core pillar is the European apparel influence, which has Japanese tastes added to it.
The recent foundation of the textile industry has also been based on European interpretations. As Japanese, we have been evolving uniquely by adding Japanese elements to this fashion. For example, unique Japanese cultural elements, high functionality, and high techniques have been added to give a unique taste to the Japanese style of modernity. Constant conversations with Western brands have led Japanese companies to evolve. For example, in the textile industry, Komatsu Seiren has added new value to its textile designs and techniques. At the same time, Momotaro Jeans adopted the Western understanding of denim and then evolved by adding Japanese elements, such as paying close attention to detail.
Japan is famed for its monozukuri spirit, something that is increasingly difficult to channel, especially due to Japan’s declining population. We know that Japan is currently facing a population crisis, with 13% of all Japanese workers over the age of 65. This causes a threefold problem. Firstly, the domestic market is shrinking. Secondly, there are difficulties in passing the necessary skill sets from veteran workers to new employees, and thirdly, there is a diminished employee base. However, it does provide an opportunity to cater to new segments. For example, the aging population has more financial resources but often cannot find the appropriate products for them. To what extent must you look overseas to ensure long-term success, and how have you been adapting to these challenges? What business opportunities do you foresee in these new market segments?
To compensate for the shrinking Japanese market, we are expanding our overseas presence. We have three core businesses. The first is yarn spinning. We hope to have a 30% ratio of overseas business for our yarn spinning. The second is our apparel knitwear OEM business, which we hope will increase our overseas ratio by 40%. The third is our original brand products, of which we hope to increase our overseas sales by 30%. Increasing our overseas presence is how we are trying to mitigate the impact of the shrinkage of the Japanese market.
When it comes to addressing manpower shortages, automation is key. However, the textile industry requires craftsmanship, techniques, and know-how that have been passed down from previous generations. It is necessary to computerize the process as much as possible. However, retaining the core essence requires human labor. Having a good balance is critical for the development of our company. The reason why the Japanese textile industry has deteriorated so much is due to Japan’s traditional logistics scheme. Kimono used to go through many different companies and middlemen. The work was divided across Japan, and middlemen were required to transport the products to the next destination. For example, production may have started in Kanazawa in Ishikawa Prefecture. Then, the product would go to Kyoto and Miyagi and finally to Yamagata for distribution. The product would then be sold to the wholesaler, then the retailer, and finally to the customers. The process was very long, and the supply chain hindered Japanese manufacturers and prevented them from evolving since the amount they received from the working process was quite low. Many companies were unable to innovate, and this led to the discontinuation of many textile companies in Japan.
We were able to evolve as we were actively seeking our own supply chain. In the fact, we purchase raw materials from Japanese trading companies, however Masaki Sato with the person of the mentioned company, travel overseas to find out the best farmers. Masaki Sato loves to have direct communication with farmers but asks traders to source the materials. For example, we went to Australia, New Zealand, Mongolia, Argentina, Brazil, Peru, South Africa, United States, United Kingdom. This allowed us to procure new types of Wool, Mohair, Alpaca and Cashmere. As a wool-spinning company, we are very proactive in creating our own supply chain. Also, since we need to import all of our materials from overseas, we want to make products in Japan to export overseas.
One very important aspect is to create our own yarn. Traditionally, Europe led the way due to the British Industrial Revolution when spinning machines were invented. European countries were leaders when it came to natural yarn with China, Japan, and other countries following suit and copying. The only unique products developed by the Japanese were the synthetic fibers that were developed by Komatsu Seiren, Teijin, or Toray. Synthetic fiber development occurred outside of Europe and gave Japanese textile and apparel companies an advantage.
Another aspect that we need to take note of is cross-border E-commerce. If you look at the Chinese company Shein or the Korean companies, they have cross-border E-commerce where anybody across the globe can purchase. We must create that kind of scheme with our products so we can balance our imports with the export of our products.
Your M.&KYOKO contemporary brand blends vibrant colors and patterns and is crafted from your original yarn. You have Masaki Kyoko, a premium fashion line designed by Masaki Sato which offers sophisticated knitwear with an emphasis on elegance. Among all of the brands that you have, which one do you believe has the most business growth potential, and are there any fields or styles that you would like to incorporate into your range of products in the near future?
M.&KYOKO is the fastest-growing brand that we have. It was launched in 2001 in New York. The uniqueness of M.&KYOKO is that it presents a new style of female fashion. Annually, we have a collection in Tokyo, Paris, New York and China. We also have stores in Taiwan, Paris owned by a local company, and Japan. If you look at mainstream Western female fashion, it is more from draw out the sexiness of women and make them look more attractive. However, Japanese fashion is geared more towards kawaii or cuteness and is more of an appreciation from females. We want to represent a new mindset of cuteness where women can gain admiration from their peers for the outfits that they are wearing. The texture, technique, and colors are some of the attributes that make M.&KYOKO stand out.
M.&Kyoko
We also have our 991 brand, which is a male knitwear brand for sweaters and jackets. Traditionally speaking, men's knitwear was solely focused on high-grade wool with thin yarn. However, across the globe, there are diverse types of sheep and wool. We decided to take the best aspects from each and make our own products. For example, Americans, Africans, and Asians have different types of hair. The same goes for sheep. They each have a different uniqueness when it comes to the wool. Generally speaking, British wool is bulkier, while Australian wool is softer. Enjoying each texture with its unique design is something that we want to present.
Another brand that we have is our silk underwear brand for females. We develop silk material that stretches. Some famous brands came to our factory and were surprised to see that stretchable silk existed. They told us that they had been looking for this fabric. We were able to develop it solely because we have an integrated supply chain from material procurement to weaving. We want to present new value and new functionality to the global fashion and apparel market, and I believe that there are still many things that Japanese companies can offer to the global arena.
In 1998, I visited the Italian factories and was astonished to see their advanced yarn manufacturing. They were creating a yarn culture and promoting it globally. I was amazed when I saw how they were innovating the yarn. Since then, I have been carrying out R&D projects on new types of wool yarn that could compete with European yarn. In 2007, for the first time, I was able to have my own collection in Florence, Italy, where there is the largest and high-end Yarn Trade show, is called as Pitti Immagine Filati. Many of the Italian manufacturers made fun of the wool yarn that I had developed and told me that I had no understanding of yarn and that I should go back and study from the beginning. However, a French brand were intrigued by the yarn that I developed. Another French brand added our yarn to their collection. Since then, it has expanded to many other European and US brands. Across the globe, all of the major brands recognize Sato Seni as an innovative yarn creator. After being strongly influenced by the European yarn character, I was determined to create a unique yarn culture in Japan. That has been my mission to this day.
Your company is the maker of choice for many high-end brands, and it is very impressive. That is something that you have been able to achieve and maintain using your vintage machinery, which helps preserve the artisanal techniques that enhance efficiency and allow you to cater to the luxury markets that we talked about. In this respect, though, these machines do face challenges. They are older, with some of them over 60 or 70 years old, and therefore more difficult to maintain. How do you overcome these challenges of maintaining your machines as they become older?
The benefit of using vintage machinery from 60 or 70 years ago is that when the machinery was first produced, the wool material was very rough, and the sizes were very diverse. The wool fiber could be thin, thick, or long. We were able to convert all of those different fiber or raw materials into yarn using the old machinery. However, with the evolution of the machinery, there is now more of a focus on productivity, increasing speed, and reducing the costs of the machinery. The material itself has also improved and is now easier for modern machinery to deal with. The advantage of vintage machinery is that it has the greatest ability to make yarn from the materials. Although it may be very slow and requires human assistance, it can create special textures.
With time, maintenance has become a struggle. However, since the machines do not use computers, once they are maintained mechanically, they can be used for longer. The problem is that the manufacturers may have discontinued some of the parts, and the maintenance technology itself is hard to maintain. To overcome this challenge, we are purchasing all of the old vintage machinery from the discontinued mills to use them as spare parts and replacements for our machinery.
You mentioned your partnerships with some of the world’s greatest and most luxurious brands. Your partnership with DHL and GoGreen Plus is also a sustainable, friendly logistics system. What role will partnerships play in your business model in the future, and are you currently looking for any new partners, particularly in overseas markets?
Sales partners are important. We are looking for sales partners who can act as agents and tell the story of our products. You can immediately tell if wool is of high quality the moment you touch it. However, our products have their own story. Dry wool, a material that has a dry hands feel, but is not scratchy nor harsh, feeling comfortable even on skin. It has its own backstory. Having an agent and salespeople who love our products and can convey their stories is very important for adding more value to our brand. Also, partnering with raw material providers is key for our further advancement. Conventionally, many middlemen, such as trading companies, acted between the material farmers and the end finished product manufacturers. By cutting out all of the middlemen and having direct relationships with the farmers, we can show them what kinds of products their raw materials are converted into. We hope that more farmers will be interested in working with us as a result.
Your company has 20 shops in Japan and four in Taiwan which are owned by a local company. Including France, Italy, and the US, you also do whole to boutiques in around 15 countries worldwide. You produce yarn for both Europe and the US, and you also manufacture knitwear for the US. Where are you looking to continue your international expansion and are you looking for local partners to help you open your own shops and expand your brands overseas?
When it comes to our overseas strategy, we want to continue to expand our sales channels and develop extensive relationships with new brands. Also, recently, the menswear industry has been revolutionized due to Chinese manufacturers using high-end thread at very reasonable prices. That has changed the mindset of high-end luxury brands. They are now interested not only in high-end yarn but also in dry yarn and sponge yarn. That is quite a huge move in the high-end menswear industry and has led to those companies offering a wider range of products.
When it comes to our products, our target is to have either agent stores or directly run stores in every major city across the globe. We want to first focus on Asia. Our products are more niche-demand products. Our goal is to expand our locations so we can accumulate the numbers through diverse sales channels. In terms of our OEM business, there has been a new, diverse usage of wool. For example, flame-resistant fiber is something very new. Also, covering natural-based fiber with wool is a new material that can be used outdoors. The usage of knitwear has also widened into underwear, outdoor, and other new applications. Developing new types of wool that can add new value and provide new functionality is very important.
The uniqueness that we have is that we provide one-and-only yarn to the world, and many companies are interested in our yarn-making. Also, using Shima Seiki’s machinery, we create seamless 3D knitwear products. In apparel, consumption of raw materials for the basic knitwear seams are around 7%. By providing seamless products, we can reduce quite a considerable amount of yarn that is additionally needed for the seams as well as the amount that is discarded from seam cuttings. This allows us to be more environmentally friendly. We are one of the very few companies that can do this seamless knitting.
How would you like your company to be seen by the global readers of Newsweek?
Sato Seni is a company that is creating a new Japanese textile and apparel culture and we want to promote this culture globally.
For more information, visit their website at: https://satoseni.com/
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