Sunday, May 19, 2024

This shop is over 1,020 years old and running: But not a surprise in Japan

The oldest running hotel is not in Paris, Rome, or London. It is, according to the Guinness Book of World Records, Yamanashi, Japan; which has existed since the year 705 and hence 1315 years old.  

But isn’t just about the hotels. Japan is home to a lot of the world’s oldest companies. Kyoto, Japan’s ancient capital, holds the highest proportion of century-old firms.  The country is home to more than 33,000 with at least 100 years of history- over 40% of the world’s total. Over 3,100 have been running for at least two centuries. Around 140 have existed for more than 500 years. And at least 19 claims to have been continuously operating since the first millennium.

There is even a specific Japanese term for companies that have survived for more than a century, retained ownership within the same family, and continued plying the same trade for the duration. They are called “shinise farm”

One such firm is Ichimonjiya Wasuke or Ichiwa for short is Japan’s oldest confectioner, founded in the year 1000 and has been in operation continually since the Heian period. Located next to the Imamiya Shrine in Kyoto, Ichiwa is run by the same family for 25 generations.

Naomi Hasegawa, who is currently running the shop, sells toasted mochi to people.

While the organizations around the world are worried to keep their business afloat, Hasegawa says she is not concerned about her enterprise’s finances.

Like many other old businesses in the city, the key to their success was maintaining high social standing in the city amid a changing business environment characterized by loss of traditional values and practices, changing consumer tastes due to Japan’s Westernisation, and increasing competition from larger and internationally operating firms.

Their high social standing partly comes through the traditional emphasis of these firms. As well as producing and selling traditional Japanese crafts, they embody and reproduce local community values. In doing so, the shinise firms are like custodians that protect local traditions. And, culturally, there is a love of tradition in Japan that gives these firms a cachet with consumers and the local community.

These enterprises might not be as dynamic as the one in other countries but their resilience offers great lessons for businesses in high tech places like the United States, where the coronavirus has forced tens of thousands into bankruptcy. These oldest businesses hold the trick for bigger firms of what does it takes for a business to survive for a thousand years.

Kenji Matsuoka, a professor emeritus of business at Ryukoku University in Kyoto says that for these companies operate on different principles.  “If you look at the economics textbooks, enterprises are supposed to be maximizing profits, scaling up their size, market share, and growth rate. But these companies’ operating principles are completely different.”

These shinise firms usually do something to help the local community. They not only just promote traditional goods and services but also are a source of pride and fascination.

One of the reasons that shinise firms last so long is that they put a strong emphasis on longevity and tradition. While the sizes of the shinise firms vary, many of them prioritize sticking to their existing commitments over seeking short-term profit or rapid growth. If they grew, they did so while maintaining these commitments. Ms. Hasegawa says a business cannot just work for profits. It has to have a higher purpose. For Ichiwa- it was their religious calling: serving the shrine’s pilgrimage.

Japan’s business culture is not one to obsess over quarterly reports. It is about doing that one thing and doing it well.

(This is a rewrite from New York Times)

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