* * * * * * * * * T E R R I E 'S T A K E * * * * * * *<br>A weekly roundup of news & information from Terrie Lloyd.<br>(<a href="http://www.terrie.com">http://www.terrie.com</a>)<br><br>General Edition Sunday, August 7, 2011, Issue No. 625<br>
<br>+++ INDEX<br><br>- What's New -- Why is Hitachi Merging with MHI?<br>- News -- Public mistrust in new rice harvest<br>- Candidate Roundup/Vacancies<br>- Upcoming Events<br>- Corrections/Feedback -- Tradoria Really a Deal?<br>
- News Credits<br><br>SUBSCRIBE to, UNSUBSCRIBE from Terrie's Take at:<br><a href="http://mailman.japaninc.com/mailman/listinfo/terrie">http://mailman.japaninc.com/mailman/listinfo/terrie</a><br><br>BACK ISSUES<br><a href="http://www.japaninc.com/terries_take">http://www.japaninc.com/terries_take</a>, or,<br>
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<br>------------ PBXL is BUSINESS COMMUNICATIONS --------------<br><br><br>+++ WHAT'S NEW<br><br>Last week the Japanese commercial sector was abuzz with a<br>story broken by the Nikkei, that Hitachi and Mitsubishi<br>
Heavy Industries were in discussions to merge their<br>businesses sometime in 2013. Apparently the two companies<br>are looking at a "merger of equals" and creating Japan's<br>second largest company after Toyota.<br>
<br>On the face of it, the merger is a bold and exciting move.<br>Both companies have core businesses that complement each<br>other and would go a long way to helping each other survive<br>in competition against GE, Siemens, and various Chinese<br>
newcomers. However, Reuters has since come out with a story<br>that, after all the media speculation, both companies are<br>now possibly backing away from a merger discussion.<br><br>While on the one hand it is surprising that they can't take the<br>
heat of the media spotlight, given that both firms are so<br>large and well known, on the other hand both have<br>backgrounds of being reticent engineer-driven businesses<br>suffused with history and pride, and the media speculation<br>
hurts. Neither company wants to hear others, especially the<br>media, say what is an obvious reality, that with the<br>decline in the domestic sector and patronage by the<br>government, they have to reinvent themselves and go<br>
international. The trouble is that their foreign<br>competitors run circles around them in terms of speed and<br>cost-efficiency.<br><br>[Continued below...]<br><br>---------------- Would You Write to Eat Out? --------------<br>
<br>Metropolis' <a href="http://www.metrodining.jp">www.metrodining.jp</a> website is gaining followers<br>at a prodigious pace, and we need more expertly written<br>food reviews.<br><br>If you can write, and if you eat out a lot anyway, just<br>
how many reviews of places you have already been to would<br>you be willing to write, in return for a meal out for two<br>as payment?<br><br>We're interested to know the answer to that question and<br>invite readers to contact us and share their opinions.<br>
Better still, if you would like to be a guinea pig in a<br>new barter payment program we are considering for<br>Metrodining.jp, then let us know that too.<br><br>Contact us at <a href="mailto:terrie@metropolis.co.jp">terrie@metropolis.co.jp</a> to kick things off.<br>
------------------------------------------------------------<br><br>[...Article continues]<br><br>Hitachi's reaction to the original Nikkei article says it<br>all. They put out a terse press release stating only "The<br>
article is not based on fact."<br><br>Perhaps therein lies the problem. Traditional bedrock<br>companies in Japan are proud and feudalistic. This used to<br>be their strength -- commonality of purpose,<br>self-sacrificing employees, and no arguments about<br>
decisions from the top. However, with the advent of the<br>information age, quality of response and reaction has<br>become more important than unwavering commitment and<br>persistence, and Hitachi in particular has suffered as a<br>
result. Perhaps ironic given that the company is so<br>deeply involved in the IT industry.<br><br>Further, because of their deep commitment to national<br>priorities, from energy to armaments, both companies have<br>for decades been the nation's employers of choice and<br>
trusted partners of generations of governments. The<br>problem now is that they have to divest themselves of the<br>notion of being providers to the Japanese nation and<br>instead get back to the core activities of being<br>
businesses. When you're proud, that's hard to do.<br><br>The good news is that neither firm is "done for". Together<br>they would generate sales of JPY11.8trn, and employ 430,000<br>people. They are active in most countries of the world,<br>
either directly or through agents, and they cover most<br>areas of manufacturing, energy, electrics, and IT. Most<br>importantly, they have strong brand names that can carry<br>the businesses into their next growth phase, should there<br>
be one.<br><br>So why now?<br><br>Of the two companies, it is probably fair to say that<br>Hitachi is perceived as the weaker in terms of<br>competitiveness and financial performance. This is partly<br>due to its unwieldy size, partly due to its old fashioned<br>
leadership style, and partly because it is not part of a<br>strong Keiretsu grouping with ready access to emergency<br>cash. The conglomerate was hard hit by the post-bubble<br>period but somehow managed to limp on for almost 20 years.<br>
However, three years ago the company got further mauled by<br>the Lehman Shock, and it became obvious how weakened the<br>group had become. There was panic by shareholders at the<br>time, and its stock price plummeted from JPY800 to just<br>
JPY200 in a matter of months. It didn't help that the firm<br>also lost a huge amount of money that year as well.<br><br>Things appear to have improved since then, and management<br>seems to be taking seriously the need for drastic changes.<br>
It was around 2008 that we started hearing of radical ideas<br>such as sending hundreds of engineers to India and other<br>emerging economies, as the company committed to<br>internationalizing. Further, the hundreds of subsidiaries<br>
started getting merged or cut, and as a result,<br>consolidated net profit for last year was JPY238bn -- the<br>highest for years. Still, they need to continue focusing on<br>profitability, which is currently around 3%. In comparison,<br>
GE has a profit margin of around 30% for similar sales, and<br>Siemens in Europe comes in at around 14%.<br><br>There are plenty of other old fashioned behemoths needing<br>to merge, trim, and internationalize, and we're going to<br>
see more of these announcements come up, whether or not<br>this Hitachi-MHI deal goes through. Speculation is that<br>Kawasaki Heavy Industries, IHI, and even Toshiba will have<br>to look at merging with someone else in order to compete<br>
with Hitachi-MHI.<br><br>However, the company that we think most needs to be merged<br>with someone is NEC. More on them another day, but suffice<br>to say that while even Hitachi's share price has held<br>steady over the last 6 months, NEC has lost about 40% of<br>
its value. Shareholders sense there is a sickness that the<br>company can't shake, and with an FY2011 loss of JPY12.5bn<br>they'd be right.<br><br><br>...The information janitors/<br><br>***------------------------****-------------------------***<br>
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Web: <a href="http://www.biosjp.com">www.biosjp.com</a><br>-----------------------------------------------------------<br><br>+++ NEWS<br><br>- Public mistrust in new rice harvest<br>- Gaba about to be gobbled up<br>- Automakers struggling to find employees<br>
- Korean alternative medicine draws thousands<br>- UK MOX plant closes down<br><br><br>-> Public mistrust in new rice harvest<br><br>The Agriculture Ministry has a big problem. Consumers are<br>dubious about the safety of the new season rice crop and<br>
are instead stockpiling 2010 rice while they can. The<br>Ministry has said that it will check new season rice in two<br> stages, to ensure food safety, but nonetheless, rice<br>merchants all over Tokyo are running out of last year's<br>
stock, reporting sales at double the normal levels. ***Ed:<br>Housewives can be fooled once, but not twice. Their logic<br>is simple: if thousands of cattle contaminated with cesium<br>can be "accidentally" sold into the food chain and that<br>
cesium came from rice stalks used as feed, then the<br>chances are that the current rice crop from Fukushima<br>and surrounding areas might be contaminated as well.<br>Perception is reality.** (Source: TT commentary from<br>
<a href="http://japantimes.co.jp">japantimes.co.jp</a>, Aug 6, 2011)<br><br><a href="http://search.japantimes.co.jp/mail/nn20110806a3.html">http://search.japantimes.co.jp/mail/nn20110806a3.html</a><br><br>-> Gaba about to be gobbled up<br>
<br>Medical-Education operator, Nichii Gakkan, has announced<br>that it will acquire Gaba, the high-profile English-language<br>conversation school, for JPY10bn. Nichii is offering a 53%<br>premium over Gaba's closing price on Friday. While Nichii<br>
lost JPY2.3bn on its education sector last year (it is<br>much more successful in Health/Medical), Gaba in<br>contrast made JPY596m on sales of JPY7.57bn. ***Ed:<br>We're not sure that Gaba is going to fill the huge hole<br>
that Nichii experienced in Education last year, but at<br>least the timing will be good to hop on to the<br>internationalization bandwagon.** (Source: TT commentary<br>from <a href="http://e.nikkei.co.jp">e.nikkei.co.jp</a>, Aug 6, 2011)<br>
<br><a href="http://e.nikkei.com/e/ac/TNKS/Nni20110805D0508N04.htm">http://e.nikkei.com/e/ac/TNKS/Nni20110805D0508N04.htm</a><br><br>-> Automakers struggling to find employees<br><br>In an ironic situation, given the general high<br>
unemployment in Japan and the joblessness of many<br>up in Tohoku, Honda and other auto firms are<br>complaining that they can't find enough factory workers.<br>Honda is looking for around 3,000 contract employees<br>
and is using job placement companies to help in the<br>search. ***Ed: The problem is two-fold. Firstly the<br>positions Honda is offering, only pay<br>JPY1,200-JPY1,300/hour, which is not high enough to<br>make young unemployed people want to leave home and<br>
the dole, and secondly, the government sent home in 2009<br>and 2010 tens of thousands of Brazilian nisei who otherwise<br>would have filled the gap.** (Source: TT commentary from<br><a href="http://e.nikkei.co.jp">e.nikkei.co.jp</a>, Aug 6, 2011)<br>
<br><a href="http://e.nikkei.com/e/ac/tnks/Nni20110806D0508A15.htm?GID=130">http://e.nikkei.com/e/ac/tnks/Nni20110806D0508A15.htm?GID=130</a><br><br>-> Korean alternative medicine draws thousands<br><br>Maybe Japan should be taking a leaf out of South Korea's<br>
playbook as far as medical tourism is concerned. While<br>Japan may get a couple of hundred heart patients a year,<br>according to the Korea Tourism Organization, in the first<br>half of 2011 6,246 Japanese tourists checked in for<br>
treatment at nine Korean hospitals and clinics -- in<br>particular those specializing in Oriental medicine,<br>dermatology and plastic surgery. This is a 35.2% over last<br>year. ***Ed: A friend who went to one of these clinics tells<br>
us that most popular on the alternative medicine side is<br>treatment for facial wrinkles amongst women in their 40's<br>and 50's. Nothing new under the sun...** (Source: TT <br>commentary from <a href="http://donga.com">donga.com</a>, Aug 6, 2011)<br>
<br><a href="http://bit.ly/oH7rmZ">http://bit.ly/oH7rmZ</a><br><br>-> UK MOX plant closes down<br><br>A disaster half a world away has meant the loss of 600 jobs<br>for workers in Seascale, on the UK's Northwest Cumbria<br>
coast. The Sellafield plant depended on Chubu Electric<br>Power (Chuden) buying MOX fuel for Chubu-region nuclear<br>reactors, and Chuden was in fact Sellafield's only major<br>contract client. The closure will have a major negative<br>
effect on employment in the area and local unions are<br>understandably upset. However, the strong move away from<br>commissioning any further nuclear facilities by the Japan<br>government means that there is little likelihood of a<br>
reprieve for the Sellafield workers. (Source: TT commentary<br>from <a href="http://nwemail.co.uk">nwemail.co.uk</a>, Aug 6, 2011)<br><br><a href="http://bit.ly/n38Uvn">http://bit.ly/n38Uvn</a><br><br><br>NOTE: Broken links<br>
Many online news sources remove their articles after just a<br>few days of posting them, thus breaking our links -- we<br>apologize for the inconvenience.<br><br>***------------------------****-------------------------***<br>
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-----------------------------------------------------------<br><br>***------------------------****-------------------------***<br><br>+++ CANDIDATE ROUND UP/VACANCIES<br><br>=> BiOS, a Division of the LINC Media group, is actively<br>
marketing the following positions for customers setting up<br>or expanding in Japan, as well as other employers of<br>bilinguals.<br><br>** HIGHLIGHTED POSITION<br><br>BiOS is urgently looking for a Vendor Management Contract<br>
Administrator with experience preparing IT<br>procurement-related official documentation at our client’s<br>office in the Shinagawa-ku area. The candidate will be<br>responsible for assisting all of the company’s Japan office<br>
activities, such as managing and coordinating contract<br>administration activities, as well as liaising with<br>technical contacts at all Japan offices, and client<br>procurement services to ensure the timely completion of<br>
contract execution and renewal processes.<br><br>You will also be responsible for working with client legal<br>offices to ensure that the legal review/approval process is<br>followed and deviations are approved where necessary.<br>
<br>Due to the technical nature and demanding work environment,<br>this position is suitable for someone with solid experience<br>administering technology-related contracts. In addition,<br>since this role requires coordination with many internal<br>
and external teams/departments, including the Legal<br>department, business-level communication skills in<br>English and native-level Japanese is required.<br><br>Remuneration is JPY7m – JPY10m depending on your experience<br>
and skill level.<br><br>** POSITIONS VACANT<br><br>- IMAC Engineer, global ibank, JPY4M – JPY5M<br>- Sales Team Account Manager, BiOS, JPY4M – JPY5M<br>- Project Manager, global bank, JPY7M – JPY10M<br>- Nw & Voice Eng, global mktg co, JPY 5M – JPY6.5M<br>
- Field Engineer, BiOS, JPY4M – JPY5M<br><br>Interested individuals may e-mail resumes to:<br><a href="mailto:tomohiro.kimura@biosjp.com">tomohiro.kimura@biosjp.com</a><br><br>** BiOS Job Mail<br><br>Every 2 weeks BiOS sends out a regular communication to its<br>
job seeking candidates, called BiOS Job Mail. Every edition<br>carries a list of BiOS's current and most up-to-date<br>vacancies, with each entry featuring a short job<br>description and a direct link to the main entry on the BiOS<br>
home page. Regardless of whether you are unemployed and<br>searching, thinking about a career change, or just curious<br>to know if there is something out there that might suit you<br>better, the BiOS Job Mail newsletter is an easy and<br>
convenient way for you to stay informed. If you would like<br>to register for the BiOS Job Mail, or to find out more,<br>please email <a href="mailto:tomohiro.kimura@biosjp.com">tomohiro.kimura@biosjp.com</a>.<br>-----------------------------------------------------------<br>
<br>***------------------------****-------------------------***<br><br>+++ UPCOMING EVENTS/ANNOUNCEMENTS<br><br>--------------- Start a Company in Japan ------------------<br><br>Entrepreneur's Handbook Seminar, 10th of September, 2011<br>
<br>If you have been considering setting up your own company,<br>find out what it takes to make it successful. Terrie Lloyd,<br>founder of over 17 start-up companies in Japan, will be<br>giving an English-language seminar and Q and A on<br>
starting up a company in Japan.<br><br>This is an ideal opportunity to find out what is involved,<br>and to ask specific questions that are not normally<br>answered in business books. All materials are in English<br>and are Japan-focused.<br>
<br>For more details:<br><a href="http://www.japaninc.com/entrepreneur_handbook_seminar">http://www.japaninc.com/entrepreneur_handbook_seminar</a><br>-----------------------------------------------------------<br><br>--------------- Mate Rock Charity Concert -----------------<br>
<br>Australian Rock Legends come together to help Tohoku<br><br>Featuring: Jimmy Barnes, the Angels, & Kevin Bloody Wilson!<br>Hakuba 47, 10th of September, 2011.<br><br>Mate Rock is a musical extravaganza to be held in Hakuba, a<br>
beautiful mountain village in the Japan Alps, about 3 hours<br>from Tokyo. The concert will run from noon to early evening<br>at the base of the 47 Ski Resort. Bring a rug and a picnic<br>and enjoy a day of classic Australian rock in a spectacular<br>
natural setting.<br><br>All proceeds of the concert will go to charities in Tohoku<br>providing scholarships for children to study overseas.<br><br>For information and bookings; <a href="http://www.materock.com">www.materock.com</a><br>
-----------------------------------------------------------<br><br>***------------------------****-------------------------***<br><br>+++ CORRECTIONS/FEEDBACK<br><br>In this section we run comments and corrections submitted<br>
by readers. We encourage you to spot our mistakes and<br>amplify our points, by email, to <a href="mailto:editors@terrie.com">editors@terrie.com</a>.<br><br>*** In TT624 we wondered if Rakuten was over-extending<br>itself, especially since its Tradoria acquisition in<br>
Germany brings the company to about US$1bn in acquisitions<br>in the last 18 months. A reader now wonders if Tradoria is<br>such a bargain in the first place.<br><br>=> Reader contribution:<br><br>Tradoria is Germany's leading online shopping mall? Not<br>
really. Amazon.de and numerous other e-commerce platforms<br>like <a href="http://ebay.de">ebay.de</a>, <a href="http://zalando.de">zalando.de</a> or <a href="http://otto.de">otto.de</a> are bigger and receive<br>more traffic and customers than Tradoria. Have a look at<br>
<a href="http://trends.google.com">trends.google.com</a> for some traffic info on above mentioned<br>sites. Tradoria.de clocks in at a measly 15,000 unique<br>visitors whereas <a href="http://amazon.de">amazon.de</a> easily surpasses 1 million<br>
uniques a day (<a href="http://ebay.de">ebay.de</a> 3m, <a href="http://otto.de">otto.de</a> 250k, <a href="http://zalando.de">zalando.de</a><br>150k).<br><br>Also, tradoria had quite some negative press<br>(<a href="http://goo.gl/CcfJ9">http://goo.gl/CcfJ9</a>) and customer experiences aren't so<br>
great either (<a href="http://goo.gl/jKgdm">http://goo.gl/jKgdm</a>). Rakuten Inc. probably<br>chose to acquire Tradoria from DuMont Venture because<br>Rakuten's B2B2C business model is exactly what Tradoria<br>does. As you already pointed out in your "Internal" points<br>
1 to 3, international business will be _very_ challenging<br>and different for Rakuten from the closed Japanese<br>environment. I say wait and see to Rakuten's broad-business<br>strategy, it might work in Japan but things will be<br>
difficult internationally.<br>***********************************************************<br>END<br><br>SUBSCRIBERS: 8,926 members as of Aug 7, 2011<br>(We purge our list regularly.)<br><br>+++ ABOUT US<br><br>STAFF<br>Written by: Terrie Lloyd (<a href="mailto:terrie.lloyd@japaninc.com">terrie.lloyd@japaninc.com</a>)<br>
<br>HELP: E-mail <a href="mailto:Terrie-request@mailman.japaninc.com">Terrie-request@mailman.japaninc.com</a><br>with the word 'help' in the subject or body (don't include<br>the quotes), and you will get back a message with<br>
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or, <a href="http://mailman.japaninc.com/pipermail/terrie/">http://mailman.japaninc.com/pipermail/terrie/</a><br><br>Copyright 2011 Japan Inc. Communications Inc.<br><br>----------------- Japan Inc opens up Japan ----------------<br>
<br>J@pan Inc is Japan's only independently published English-<br>language business website. Authoritatively chronicling<br>online the business trends in Japan, each posting brings<br>you in-depth analysis of business, people and technology in<br>
the world's second largest economy.<br><br>Visit <a href="http://www.japaninc.com">www.japaninc.com</a> for the best business insight on<br>Japan available.<br>-----------------------------------------------------------<br>
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