A business lesson in resilience
In existence for 1,020 years, shop knows how to weather crises
KYOTO, Japan — Naomi Hasegawa’s family sells toasted mochi out of a small, cedar-timbered shop next to a rambling old shrine in Kyoto. The family started the business to provide refreshments to weary travelers coming from across Japan to pray for pandemic relief — in the year 1000.
Now, more than a millennium later, a new disease has devastated the economy in the ancient capital, as its once reliable stream of tourists has evaporated. But Hasegawa is not concerned about her enterprise’s finances.
Like many businesses in Japan, her family’s shop, Ichiwa, takes the long view — albeit longer than most. By putting tradition and stability over profit and growth, Ichiwa has weathered wars, plagues, natural disasters, and the rise and fall of empires. Through it all, its rice flour cakes have remained the same.
Such enterprises may be less dynamic than those in other countries. But their resilience offers lessons for businesses in places like the United States, where the coronavirus has forced tens of thousands into bankruptcy.
Japan is an old-business superpower. The country is home to more than 33,000 with at least 100 years of history — over 40% of the world’s total, according to a study by the Tokyo-based Research Institute of Centennial Management. Over 3,100 have been running for at least two centuries. Around 140 have existed for more than 500 years. And at least 19 claim to have been continuously operating since the first millennium.
The businesses, known as “shinise,” are a source of both pride and fascination. Regional governments promote their products. Business management books explain the secrets of their success. And entire travel guides are devoted to them.
Most of these old businesses are small, family-run enterprises that deal in traditional goods and services. But some are among Japan’s most famous companies, including Nintendo, which got its start making playing cards 131 years ago, and the soy sauce brand Kikkoman, which has been around since 1917.
To survive for a millennium, Hasegawa said, a business cannot just chase profits. It has to have a higher purpose. In the case of Ichiwa, that was a religious calling: serving the shrine’s pilgrims.
Those kinds of core values, known as “kakun,” or family precepts, have guided many companies’ business decisions through the generations. They look after their employees, support the community and strive to make a product that inspires pride.
For Ichiwa, that means doing one thing and doing it well — a very Japanese approach to business.
For most of Ichiwa’s history, the women of the Hasegawa family made the sweet snack in more or less the same way. They boiled the rice in the water from a small spring that burbles into the shop’s cellar, pounded it into a paste and then shaped it into balls that they toasted on wooden skewers over a small cast-iron hibachi. The rice’s caramelized skin is brushed with sweet miso paste and served hot.
Ichiwa has made a few concessions to modernity. The local health department has forbidden the use of well water. A mochi machine hidden in the kitchen mechanically pounds the rice, saving a few hours of work each morning.
The Japanese companies that have endured the longest have often been defined by an aversion to risk and an accumulation of large cash reserves. It is part of the reason that the country has so far avoided the high bankruptcy rates of the United States during the pandemic.