It’s time for another random Japanese word to learn. I’m not entirely positive how frequently this word shows up in daily life, but the presence of it is felt daily. Drum roll please...
Sōgōshōsha means “general trading company”. I think many of you might be able to deduce what that is but may be unclear on what qualifies as such. I think a more precise image of this type of company would be a “conglomerate”; think Proctor & Gamble, Time Warner, or Disney.
For our Japanese example, I’ll choose “Mitsubishi”. I’m sure many Americans are aware of Mitsubishi’s presence in the automotive industry, but were you aware of the other products and services they provide? For example, Mitsubishi has there hands in finance via MUFG(the largest bank in Japan), heavy industries, oil and gas, real estate, mining, aviation, food and beverage, electronics, chemicals, shipping, and much more.
How did they spread into so many industries?
It’s actually not as complicated as it seems. Mitsubishi began in shipping, but eventually needed to provide coal for their ships, therefore delving into mining. As business increased, the company would eventually need a shipyard to repair their ships. That, in-turn required an iron mill, which would lead them to require marine insurance for their new ship building investments. And so on and so on. It truly was a case of “one thing leading to another”. Thus my selection of the day, 総合商社/sōgōshōsha.
How long did all this take?
Founded in 1879 by Yatarō Iwasaki, 2 years after the Meiji Restoration, Mitsubishi has been around for over a century(149 years). Because of its massive scale and diverse portfolio, the company had a significant role in modernizing the Japanese economy pre and post WWII. There are few companies in Japan that have legacies similar to Mitsubishi(Sumitomo, Mitsui are others extremely visible in daily life). The companies that had direct control over Japan’s economy in the pre-war era were known as 財閥/zaibatsu. In the post war period, these groups of companies became known as 系列/keiretsu and still have a direct impact on today’s economy and politics; often lobbying politicians for more lenient regulation and pressing more beneficial policy making.
Naturally, companies with such wide reach in the Japanese economy might not always be in the best interest of the country, however I won’t go too far into the weeds with that one. They are technically “independently” controlled, but that just seems like a formality put to paper. I’m certain there is some revolving door politics going on here just as there is in the west. So, let’s just say it doesn’t really help with the recession-in my opinion. It is an interesting topic to read up on though! I’m no history expert, but I hope you guys found this read interesting.
Until next time,