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Ursa Group: The Hub Company of Comfort

Interview - December 14, 2024

Defined as a hub company, Ursa Group is running towards the realization of a society where comfort is the norm.

HIROSHI NAKATA, PRESIDENT OF URSA GROUP
HIROSHI NAKATA | PRESIDENT OF URSA GROUP

Since its founding in 1968 as a wet towel rental business, the Ursa Group has diversified into various service sectors, including linen supplies and imports, mineral water delivery, specialized cleaning services, and human resources. This wide-ranging portfolio reflects a strong focus on distribution, supply chain management, and specialized solutions to meet diverse customer and business needs. How has your business evolved over time, and can you speak to some of your core values as a company?

My father founded this company in 1968, so I represent the second generation. As you mentioned, we started as a wet towel rental business, but that business was limited to restaurants, so we were always influenced by the trends of that industry. That’s why we thought we needed to diversify our portfolio, and taking advantage of the know-how that we earned through the wet towel business, we went into other markets. That was the decision made by my father and myself, and we started to diversify this business by supplying linen to hotels, hospitals, and offices. This business leverages the strengths that we earned through the wet towel business and means that we are no longer relying on only one industry.



In our business, customers order cleaning and hygiene products, but ultimately, our products are evaluated by our customers' end users. For the restaurant business, the users who come to the restaurant are the ones who evaluate our wet towels. The same goes for hotels, where the guests evaluate the linen that we supply. Of course, our products needed to be clean and hygienic, but in terms of the evaluation, that is typically by negative feedback, so being clean and hygienic is just the minimum requirement, and if something happens with our products, then the customers give us negative feedback. That’s why we want to give added value to our products by making them very comfortable. We also developed Vetiver, which is a deodorant spray, and we added that service of deodorizing as an added value for our products. By adding that extra value, we could move from only getting negative feedback to getting positive feedback.

 

Over the next 15 years, Japan expects significant demographic shifts characterized by both an aging and a declining population. This will lead to both a shrinking domestic market and a labor shortage. What challenges and opportunities does this create for your company, and how are you navigating those challenges and capitalizing on opportunities?

The labor shortage is a significant issue for our industry and also for the entire country. Our process of washing the materials we supply requires a lot of manual work because all of our products are different sizes and shapes. For the process of finishing the products, we are working with the manufacturer to find labor-saving efforts.

 

To follow up on that, is there anything you’re doing internationally to compensate for the domestic market, and are you recruiting any foreign workers?

Yes, we have established a program to accept foreign workers as trainees, and we also have a staffing business. We used to outsource staffing, but now we’ve got a license for it, and that business is part of our group. Having said that, from the foreign workers’ perspective, Japanese salaries are not that attractive compared to those in other countries, so more and more foreign workers are choosing other countries recently. Thus, it’s getting difficult for us to secure foreign trainees as well. We want foreign workers to come and work in our company, but in reality, it is getting more difficult. Of course, we have a lot of inbound tourists coming to Japan now, and that is energizing the hotel industry, which means more workers will be needed.

 

To build off on that last point, how are you capitalizing on the record number of tourists coming into the country?

Of course, our business is influenced by the trends in the hotel and restaurant industries. For hotels, the occupancy rate and the average price per customer are increasing due to the inbound tourists. Likewise, revenues are increasing at restaurants for the same reason, but we supply wet towels, which are part of the unique Japanese culture, so it is difficult for some foreign customers to understand or use the towels in the restaurants. To address that issue, I believe we need more ways to showcase the value of this product.

Our company philosophy is to create a future of comfortability. We have established five different stages of comfort, starting from normal quality all the way to innovation.

 

Maintaining quality in the linen rental industry is a significant challenge due to wear and tear, stringent hygiene standards, and the need for faster run times. Any lapse in quality can lead to customer dissatisfaction, increased costs, and potential health risks. Ursa Group ensures consistently high standards through advanced technology, stringent internal controls, and a strong focus on hygiene. What technologies are integrated into the products you handle, and how does this help you overcome some challenges in the rental business?

For the process that relies on machines, we introduced cameras so that we can capture any wrinkles, dirt, or objects on the linen. If the camera captures such anomalies, the item is removed. Also, before we ship any item, we use a metal detector to perform a final check. Those are the things that we are using to overcome the challenges, but to operate the machines, we need a lot of human labor, so we need to enhance productivity. At the same time, we must consider that the products we are handling go to the customers’ end users and contact their skin, so we want our employees to always imagine the faces of our end users when they operate their machines or care for our products.

Our products are often used at hospitals, hotels, and restaurants, which provide occasions that differ from daily life, so these are special places for the users, and we are catering to those special occasions. That is another thing that we try to make our employees aware of.



As you have mentioned, your linen business serves hotels and hospitals, both of which present significant opportunities. In the hotel sector, you focus on providing a full range of linens. In the hospital sector, you offer rental services for bedding and uniform linens tailored to meet the specific needs of healthcare facilities. Between these two sectors, where do you see the most growth potential, and how are you capitalizing on that growth?

I don’t think that hospital demand will increase in the future, but we are sure that the number of nursing facilities will increase to meet the needs of the aging society, so we are focusing on that part of the industry.

As for the hotel industry, Fukuoka is one area that attracts a lot of inbound tourists, and many new hotels have been built here. The older hotels are concerned about their facilities needing to be updated. To address that, we offer a renovation service for hotel bathrooms, and the demand for this service is increasing a lot so that we can better compete with the new hotels. That demand started increasing before the Tokyo Olympics, but since the pandemic ended, the demand has been increasing significantly, so we are trying to capitalize on this opportunity.

For the linen business, the washing facilities need to be located close to the customers, so we have bases across Japan to serve any customer at any location.

For the renovation work, there can be about 200 different renovations in one hotel room, so if you need any of these different renovations, we are ready to meet that need. For example, we supply the Vetiver deodorant spray for a lot of hotels, and through this and the linen service, we often know when a customer is considering renovation work and can offer our services. As for how we got involved in this line of business, we acquired a company that specialized in renovation work for apartment bathrooms. When we started exploring this deal, I thought it was a good match because we have a customer base that can use this company’s services.


Vetiver Deodorizer


You sell your Vetiver deodorizing product to over a thousand hotels across Japan. Can you tell us why it’s so popular amongst hotels?

The container is transparent, and there is a reason behind that. Most competitors’ products don’t have a transparent container because they use surfactants, which is the same as detergent. If you shake it, you will get a lot of foam, so that’s why they do not make their containers transparent. Our container is transparent because we want to showcase the safety and quality of the product.

Our spray is safer than our competitors because we do not use those synthetic surfactants. Deodorizer is typically placed in the hotel closets, and it is used by the cleaning staff to spray curtains. Those cleaners say that it really does remove the odors so that positive feedback is the reason so many hotels want to buy it.

 

Is this a product you’re interested in selling to hotels overseas as well?

We would like to distribute this to overseas markets, not now, but in the future.

 

Besides Japan, you have established a strong overseas presence, including in Vietnam, China, and Bangladesh. Are you interested in further internationalizing the operations of your business, and are you looking for any new partnerships?

Until now, we have imported fabric products from countries such as Vietnam, China, and Bangladesh, but going forward, we hope we can expand our domestic market businesses, such as Vetiver or linen services, in overseas markets.

Going back to the topic of Vetiver, in terms of the ingredients, we used the remnants from extracting the roots. That is good in terms of Sustainable Development Goals (SDGs). We talked a lot about linen supply, but we also do clothing cleaning, and in Japan, there is strong support for going away from the use of plastic. To help with that, we are now using cardboard hangers instead of the conventional plastic ones. This initiative has attracted a lot of attention overseas, and there is a company in Taiwan that has a strong interest in it, so I hope that more companies will pay attention to this kind of initiative that we consider important.

 

Your company is celebrating its 56th anniversary this year. Let’s imagine that we come back in four years to interview you again for your 60th anniversary. What would you tell us? What are your dreams and goals that you’d like to achieve over the next four years?

We are a small company, and we do business in the small city of Fukuoka, but we have a strong passion for this business. Our theme is comfort, and I would like to create a world where comfort is a part of our daily life. I would like our company to be the number one platform in Japan that provides value and comfort.

 


For more information, visit their website at: https://www.ursa-group.jp/

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