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Japan's furniture innovator carves niche in global market

Interview - February 27, 2024

Despite challenges in the domestic market, Aichi leads the way with cutting-edge designs and sustainable solutions, aiming to reshape educational and public spaces worldwide.

MICHIHIKO SHIMAMOTO, PRESIDENT OF AICHI CO., LTD.
MICHIHIKO SHIMAMOTO | PRESIDENT OF AICHI CO., LTD.

For the last 30 years, Japan has witnessed the emergence of regional competitors who have replicated the Japanese model of success but at lower labor costs. This trend has displaced Japan from specific mass markets. Nevertheless, Japanese firms continue to be front-runners in providing quality B2B products. How have Japanese firms sustained this leadership amidst intense price competition?

In general, Japanese firms have lost their global competitiveness. The Japanese economy experienced a boom in the 1980s, fueled by a population increase and a larger pool of the younger working generation. However, following the burst of the economic bubble, both the population and birth rates have gradually declined. The challenges faced by Japanese companies stem from their tendency to stick to the domestic market and not to explore overseas markets, given that Japan has a sizable population of 120 million. While this might have been sufficient in the past, the shrinking population and the necessity of global market engagement have left Japan falling behind. In contrast, companies from Korea, Taiwan, and China actively pursue international markets. Germany has successfully catered to the global market, enabling it to play a major role in the world economy. Japan, having slipped to the fourth-largest economy globally in terms of GDP (Gross Domestic Product), highlights its struggle to secure overseas markets. Japan has lost its status in mass production, so Japanese companies have shifted their focus to niche B2B fields as a survival strategy.

 

One of the challenges associated with Japan's shrinking demography is the shrinking domestic market, which has become its Achilles' heel due to years of insularity. Another challenge is the diminishing labor force, with fewer graduates available to replace the aging and seasoned workers. How are you responding to these labor challenges stemming from the demographic shift?

Our focus is on gathering spaces such as educational and public facilities rather than office and residential markets. We aim to broaden our product portfolio significantly, seeking a larger market share in these facilities. On the other hand, regarding labor environment issues, we are automating manufacturing equipment, sharing manufacturing processes, and classifying what we manufacture in our own factories and what we outsource to partners, and are promoting selection and concentration of manufacturing. Among the products manufactured at our own factory, our core competency lies in the stacking chair series, and we are actively expanding our business globally, with the aim of becoming a leading niche player in stacking chairs worldwide. In addition to offering furniture to educational facilities, you also provide comprehensive interior planning services, encompassing interior design, IT equipment, and various other elements.

 

Given the established understanding that a well-designed environment can positively influence the outcomes of learners, how are you actively creating the optimal educational space for projects in various educational facilities?

Our purpose is "Creating educational and gathering spaces for human well-being and the environment," and we strive to offer optimal environments, encompassing furniture, interior design, and overall space, to facilitate educational and gathering spaces. Our portfolio is built on this purpose; based on the wealth of knowledge and experience we have cultivated since our founding, we are able to propose optimal solutions tailored to educational facilities. The basis for earning trust from educational and public facilities is the provision of highly reliable products that have sophisticated designed long-lasting durability. Our entry into this sector and the provision of comprehensive services were made possible by the strength of our product lineup. Our competitiveness in the market is a direct result of the reliability of our products and the trust we have cultivated through our diverse product portfolio.

 

Your company specializes in versatile and multi-functional furniture, holding 22 international patents and 70 domestic patents. Could you please highlight key features integrated into your furniture that contribute to its enhanced versatility?

Our product development revolves around the concept of differentiation. Each time, we strive to create a unique product that stands apart from any other in the world. This approach has led to the development of new features and resulted in both domestic and global patents. We have also received numerous prestigious design awards, and our advanced designs have been internationally recognized. All our products are designed and engineered in-house by our employees. It is important for us to create products that are functional for educational and public facilities. We value the concept of developing unique products that can be patented. Leveraging the expertise of other firms can help create new products as long as both parties involved have an understanding of what the end goal is.



Are you looking to find overseas partners to create new functional products and furniture?

At this moment, we do not have any collaboration with any other companies, but in the future if necessary, we are open to collaborating with domestic and overseas. One of your patents is the spiral suspension used in your fixed theater seat which your company has been creating and continuing to evolve since its founding. This is a resin seat substrate developed by you. This material allows users to control firmness according to the distribution of the body, creating a more comfortable sitting experience.

 

Can you tell us a little more about this material and its benefits? And why did you develop it?

The development of spiral suspension stemmed from the innovation in theater seats, typically replaced every 25 years. In addressing the challenges of long-term use, we focused on creating a new material and technology. Over time, traditional theater seats tend to experience thinning and hardening of the urethane, leading to discomfort and squeaking. The spiral suspension material, now utilized in all our theater seats except for the mesh type, offers a solution by providing comfort, durability, and a prolonged lifespan without discomfort or squeaks. In addition, this spiral suspension technology is applied to the seat of Gene, the latest stacking chair model that is currently our mainstay product, to provide a comfortable sitting experience. In pursuit of comfortable sitting comfort, we took elastomer, a material that is challenging in the stacking chair category and developed the stacking chair X50, which looks like regular resin at first glance, but feels elastic when sitting.

 

Since 2010, your company has been participating in the ORGATEC exhibition in Germany, garnering AIT INNOVATION AWARD in 2012 and 2018. As we anticipate the 2024 event, do you have specific innovations or products in mind that you plan to showcase?

With nearly 60 years of accumulated experience in steel pipe bending, which is our core technology, as a leading brand of stacking chairs, we devote a lot of development resources to stacking chairs. We have released a series of stacking chairs such as the mesh stacking chair named Tipo, which is made from mesh recycled from recycled plastic bottles and 100% recycled resin, aforementioned X50, and the latest model Gene. These products won prestigious design awards (2012: Tipo, 2018: X50) at ORGATEC, and as a result, we gained sales partners around the world. Our goal is to further strengthen these products and establish ourselves as a leading global niche player in this field.

 

Considering your extensive global network, covering approximately 40 countries worldwide, which specific countries or regions have you identified as crucial for the growth of your company?

We are targeting North America, Oceania, and Europe, with an eye on the well-established interior design sector in Europe. Building a notable presence in North America and Europe will have a positive impact not only on the global market but also on our branding in Japan. In the future, we plan to expand our product offering to other regions, including Northern and Southern Europe, the Middle East, South America, Asia, and Africa.

 

If we come back on your 100th anniversary and interview you again, what hopes and dreams would you like to have achieved by then?

Our primary focus is not on expanding sales; instead, we are dedicated to emphasizing our company philosophy and values. Our goal is to enrich our products, continually creating unique offerings that contribute to educational and public spaces. While the domestic market for educational and public spaces may not experience significant growth, we aim to increase our presence in the field and address various aspects of the educational sector. Our fundamental objective is to establish ourselves as a niche top company in this field in Japan. Furthermore, in the global market, we aim to become the global niche top for stacking chairs. Although we are a company that does not place emphasis on expanding our scale, expanding exports is extremely important for our company's sustainability. Taking inspiration from the example of successful German companies targeting the global market, we aim to strengthen our product range and develop as many global niche top products as possible to increase our global presence.

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