The Business Mind

"Customers are not coming to us."
"Makers are not selling to us."
"Banks are not lending to us."

Masatoshi Ito, the honorary chairman of Ito-Yokado, began his article in the "My Personal History" column in the Nihon Keizai Shimbun with these words. He went on, "The most important thing is trust. And trust means not collateral and not money but having a sense of reliability, seriousness, and, above all else, sincerity as a human being." Furthermore, he said, "Don't forget to have a sense of gratitude. Don't be overconfident. You should be a devoted and unselfish person."

Looking at the prosperity of companies like Ito-Yokado and Seven-Eleven, you can see that their philosophies from the time of their founding have circulated in their veins, been put into practice, and become part of their genes. These companies can be expected to be achieving growth in 10 and 20 years' time, too.

"Customers are not coming"
I was very impressed by the paradox that customers "are not coming." Many companies assume that customers will come, so they open large stores. And in order to attract the customers, these large stores use typical sales promotion methods like handbills, advertisements, and inviting bargain queues.

However, there is no guarantee that the customers will keep coming forever. Getting them to come again and again is a difficult task. There will be no lasting prosperity unless you always have a sense of tension and put yourself in the customer's shoes to see what the customer really wants?and that means not simply prices but something much deeper.

For this reason, I could not help but feel a golden flash in the judgment that "customers are not coming." As well as good products, customers want warmhearted service, a feeling of security, and a sense of trust. The customer certainly does not come only for the price. The key to prosperity and the essence of business lie in being able to respond faithfully and placing importance on bonds with the customer.

"Makers are not selling"
These days I feel that the business is undergoing a major change. That is, "not selling" moves on the maker side are becoming clearer. Makers are turning their attention firmly to the defense of their brands and the securing of profits. I think that the makers that can do this eventually are going to achieve their goals, but the makers that cannot do so are going to remain floundering amid the whirlpool of price competition and are going to be exhausted.

All companies now seem to have the idea that "we won't sell to places that we don't want to sell to" or "if you are going to just sell at bargain prices, then don't bother selling our products." Also, excessive requests for things or money, such as demands for excessive rebates or financial support, are a deviation from the essence of business. There is a strong tendency for makers to turn away from stores that make such demands frequently.

Ito teaches stores that, as the premise of their business, they should assume that makers will not sell to them. He also teaches stores that the cause of failure lies in haughtiness. Even in the case of Daiei, which boasted the number-one sales in Japan, the cause of collapse was this haughtiness. Haughtiness begets failure.

Stores must endeavor to make sure that makers do not get this idea of not wanting to sell to them and must develop a profitable business of coexistence and coprosperity with makers. And for their part, makers must further strengthen their attitude that customers will not buy their goods and endeavor to supply the best products possible.