Ja­pan maker of bam­boo whisks eyes Brexit risks

The Myanmar Times - - International / Business -

BRI­TAIN might be a world away, but the fu­ture of a 500-year-old fam­ily com­pany in ru­ral Ja­pan could rest on the UK’s de­ci­sion to quit the Euro­pean Union.

Chikumeido, a spe­cial­ity maker of del­i­cate bam­boo whisks used in tra­di­tional tea cer­e­monies, started sell­ing the niche prod­ucts in the United King­dom last year, its first ma­jor push over­seas.

Sabun Kubo, its 71-year-old pres­i­dent, hoped the gam­ble would pay off by set­ting up his lit­tle com­pany for a launch into the po­ten­tially lu­cra­tive Euro­pean mar­ket, and counter years of fall­ing sales.

Things got off to a good start for the com­pany, which has been run by 24 gen­er­a­tions of Mr Kubo’s fam­ily – and then Bri­tain voted to quit the EU.

“We just started ex­port­ing to Lon­don last year as our sales base in Europe,” said the sep­tu­a­ge­nar­ian crafts­man.

“This was part of our ef­forts to take a chance on do­ing busi­ness over­seas. I thought our prod­ucts would be well re­ceived in Europe, and es­pe­cially in Bri­tain where there is a tea cul­ture.

“But then, all of a sud­den, Brexit hap­pened. It was a shock.”

Since the June 23 vote, firms in Ja­pan and across Asia have been scram­bling to get a read on how they’ll be im­pacted by Brexit, and what to do about it.

Ja­pan Inc has also been hit as wor­ries over the vote sparked a sharp rally in the yen. The cur­rency is seen as a safe in­vest­ment in tu­mul­tuous times, but its rise hurts Ja­panese ex­porters’ prof­itabil­ity.

The threat to Kubo’s min­now firm il­lus­trates how the break­away vote will not just af­fect multi­na­tional gi­ants like Toy­ota and Hi­tachi, which have ma­jor op­er­a­tions in Eng­land.

More than 1000 Ja­panese com­pa­nies do busi­ness in Bri­tain, employing some 140,000 lo­cal peo­ple, and Ja­pan’s di­rect in­vest­ment in the coun­try has topped 10 tril­lion yen (US$99 bil­lion) to date.

“The main prob­lem for Ja­panese com­pa­nies is that the sin­gle [EU] mar­kets are very small and di­verse with dif­fer­ent lan­guages and busi­ness cul­tures and of­ten dif­fer­ent stan­dards,” said Martin Schulz, se­nior re­search fel­low at the Fu­jitsu Re­search In­sti­tute in Tokyo.

“They re­ally need a po­si­tion from where they can serve the over­all mar­ket. That has been Lon­don.”

For Mr Kubo, Brexit rekin­dles wor­ries about the 100 full- and part-time em­ploy­ees work­ing for the com­pany near tem­ple-dot­ted Nara, one of Ja­pan’s an­cient cap­i­tals.

The firm is known na­tion­wide for be­ing one of the only man­u­fac­tur­ers able to pro­duce as many as 120 dif­fer­ent types of the light­weight whisks, called chasen.

The small uten­sils are made by hand from a sin­gle piece of bam­boo. They take cen­tre stage in a for­mal cer­e­mony, usu­ally per­formed in a tatam­i­floored room that in­cludes drink­ing a pow­dery form of green tea called matcha.

“When you’re mak­ing tea, you need to have a tool that can beat the sur­face into a froth,” Mr Kubo said of the emer­ald-green bev­er­age.

But the chasen busi­ness is a tough go these days as low-cost ri­vals in China and South Korea keep eat­ing away at a shrink­ing mar­ket.

Around 1970, the peak pe­riod for sales, about 50 man­u­fac­tur­ers moved around 1 mil­lion whisks yearly – and Mr Kubo’s em­ploy­ees were run off their feet, he said.

To­day, the num­ber of mak­ers has fallen by more than one-half while an­nual sales have tum­bled to about 300,000 a year, ac­cord­ing to Mr Kubo, who added that his firm con­trols about 30 per­cent of the do­mes­tic mar­ket.

While the com­pany had pre­vi­ously sold some prod­ucts abroad through Ja­panese buy­ers, last year was the first time it sold via whole­salers over­seas.

The whisks went on sale at depart­ment stores in Eng­land for about $50 each.

“After Brexit and now with the strong yen, I’m re­ally won­der­ing how this is go­ing to change our busi­ness over­seas, start­ing with Eng­land,” Mr Kubo said.

“I don’t have much rea­son for op­ti­mism.” –

‘[Ja­panese com­pa­nies] need a po­si­tion from where they can serve the over­all mar­ket.’

Martin Schulz Fu­jitsu Re­search In­sti­tute

Photo: AFP

Sabun Kubo (right) and his son and daugh­ter-in-law make bam­boo whisks in Ikoma, west­ern Ja­pan, on July 4.

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