Japanese Trading Firms Buy Small by Investing in entrepreneurialUS Companies, Huge Sogo Shosha Seek to Tap US Creativity

By Julian M. Weiss, Monitor | The Christian Science Monitor, August 6, 1991 | Go to article overview

Japanese Trading Firms Buy Small by Investing in entrepreneurialUS Companies, Huge Sogo Shosha Seek to Tap US Creativity


Julian M. Weiss, Monitor, The Christian Science Monitor


SMALL and medium-sized United States exporting companies may be getting help from an unlikely source: the titan-sized sogo shosha, or trading companies, whose global commerce commands nearly half of Japan's gross national product.

In years past, sogo shosha retained relationships with firms that were their equals, generally large commodity groups or manufacturing conglomerates. But in the last few years, the trading companies have shifted toward investment in smaller entrepreneurial firms. This investment was under $50 million in 1984, reached $325 million by 1989, and by last year probably topped $400 million, the US Department of Commerce estimates. Licensing deals, brokering venture capital, and participation in technology-based industries constitute most of the new activity. Many trading companies, including Mitsui, begin with licensing agreements.

Mitsui USA has spearheaded the shift toward investing in smaller companies. It ranks as No. 2 among all sogo shoshas - and actually rates as the fifth largest US exporter, tallying over $5 billion in trade (of which $2 billion are exports to Japan).

The shift satisfies several long-term objectives of the trading firms. One is diversification, since they were forced to recast product lines in the last decade. Second, they keep a watchful eye on US innovation in "sunrise" industries. A third goal - especially favored by Mitsubishi, another trading company - is fostering long-range ties with start-ups in niche fields.

A Tokyo official of a third trading company, C. Itoh, says Silicon Valley's legend had much to do with the trend. Trading companies see such "Valleys" as spawning grounds for cutting-edge telecommunications, biotech, and other fields, and admire the capacity of small business to innovate. Opening export doors

Sogo shosha are part of Japan's keiretsu system, giving them integrated capabilities in finance, marketing, distribution, and transport systems. This can be useful to US-based medium-sized and small companies. Sogo shosha are "able to take care of the paperwork, the logistics, the documentation," says Mark van Fleet, director of Asia-Pacific affairs at the US Chamber of Commerce. They open export doors to Japan, as well as to non-Asian destinations.

Trading companies are regarded as business catalysts. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Note: primary sources have slightly different requirements for citation. Please see these guidelines for more information.

Cited article

Japanese Trading Firms Buy Small by Investing in entrepreneurialUS Companies, Huge Sogo Shosha Seek to Tap US Creativity
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen
Items saved from this article
  • Highlights & Notes
  • Citations
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA 8, MLA 7, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Search by... Author
    Show... All Results Primary Sources Peer-reviewed

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.