Importance of Affluent Luxury Tourism to Local Economies

The importance of luxury tourism for the wealthy to local economies is generally considered to be fivefold

1. increased economic impact: The wealthy have high spending power. Affluent people have high spending power, and when they visit a region, they bring significant economic benefits to businesses such as accommodations, restaurants, and tourist attractions.

2. increase the brand value of the region: They seek quality services and unique experiences. They demand high quality service and unique experiences, and their reputation enhances the brand value of the region.

3. Preservation and promotion of culture and traditions. Traditional crafts, cuisine, festivals, etc. are preserved and promoted as visitors come to the region.

4. Development of local infrastructure. High-quality accommodations and transportation infrastructure will be developed to accommodate luxury tourism for the wealthy.

5. Sustainable tourism: The tourism industry is committed to sustainable tourism. They respect the natural environment and seek ecological experiences.


In other words, luxury tourism for the wealthy will eliminate the problem of overtourism, It is an essential element for the growth and sustainable development of local economies.

However, the current situation is that it is very difficult to attract wealthy people to the various regions of Japan, as is the case in Niseko. First, there is the language problem of not being able to speak English or Chinese; second, there is the cultural problem of exclusion of outsiders; and third, there is the problem of a lack of accommodations and other receiving infrastructure that can satisfy the wealthy.


These problems will take time and money to solve, and it is not easy to solve them in rural areas where there is a shortage of human and financial resources. Under the circumstances where it is difficult to create job opportunities by building Showa-style factories, the government is required to take a major step forward to realize luxury tourism for the wealthy in terms of education and policies in order to acquire job opportunities.




Use of Contracted Employment in the Hiring of New College Graduates

With starting salaries for college graduates now exceeding 300,000 yen at large companies, competition for human resources is becoming more intense in Japan. Reflecting the above, few students from the cities are making U-turns to the regions, so the future survival of regional companies depends on how well they can recruit students who have graduated from regional universities and wish to work for regional companies.


However, students who wish to work for regional companies are generally conservative and tend to dislike domestic transfers as well as overseas assignments. Thus, even if they find jobs, they are not risk-takers who are willing to take on challenges without fear of failure, which is what regional companies are looking for, creating a gap between the supply and demand of human resources.

The solution to these problems is to rethink the conventional employment contracting system, in which employment contracts are made under uniform employment conditions. Specifically, we need to establish employment contracts whereby students sign a contract with a contractor and are paid a salary based on their performance. It is not realistic to conclude a contracting agreement with all new graduates, but I feel that half of them could be employed under a contracting agreement. However, few local companies have the strength to do so, and the preferred form of employment is the outsourced contracting type, in which both the company and the student bear the risk.

There are obvious reasons for students to work for regional companies despite the nearly two-fold difference in starting salaries, such as not wanting to leave their parents' homes. However, it is clear that the locally based business model will collapse in the future as the population of rural areas drastically declines. Therefore, if they continue with their current hiring style, local companies may not be able to bear the employment burden in 10 years. New approaches and employment contracts are required for local companies.



















Succession Planning in Small and Medium-Sized Enterprises

Succession education in small and medium-sized enterprises (SMEs) is critical to ensure the sustainable growth and continuity of the enterprise. Smooth business succession from management to successors is essential to protect the value of the company and pursue new possibilities.

Traditionally, succession within the family has been the norm for small and medium-sized enterprises in Japan, but increasingly talented individuals are taking over as managers through MBOs, third-party succession, and other means. Successor education is time-consuming and is necessary to draw up a long-term growth strategy of five years or more.

Therefore, it is important to establish an appropriate education plan, taking into consideration the period between the decision on the successor and the actual handover. Succession planning in SMEs is important to ensure organizational continuity and growth strategies. Below are five specific methods of succession planning.

1. use of external training organizations:. Identify potential successors early on and involve them in training programs. Provide opportunities for potential candidates to learn management's thinking and culture firsthand.

2. internal on-the-job training Assigning employees to work in the field to gain experience and to multiple departments will help them develop a broad perspective. It is important to enrich their experience by assigning them to new business divisions.

3. tough business experience:. Tough experiences will help them develop their judgment. Consider setting up a subsidiary or sending them to a fast-growing venture company.

4. Work experience at other companies. Have employees acquire knowledge and skills through a combination of in-house work and outside seminars. Provide training in a planned manner to coincide with future business succession.

5. guidance by predecessors:. Guidance by management is effective. It directly conveys management's thinking and judgment, and supports the growth of successors.

By combining these methods, SMEs can achieve succession planning.


Many companies falsely tell new employees that they should take on challenges without fear of failure

When hiring new employees, many companies They want new employees to "take on challenges without fear of failure.

In general, this is to

1. growth and learning

2. innovation and competitiveness

3. teamwork and trust

4. leadership development

5. building a positive organizational culture

The purpose of the program is supposed to be to "build a positive organizational culture," among others. However, in reality, none of the companies are praised when a new employee joins the company and fails. The first priority is to learn the job. New employees do not have the opportunity to try new things, and failures are treated as mistakes. Companies are well aware of the above, The companies are aware of the above and intentionally omit the phrase "when the new employee has grown up enough". The sinister part is that they intentionally omit the phrase "when you have grown up enough. New employees who join a company with a willingness to take on new challenges Despairing of the status quo and are shaped by the corporate culture, and by the time they grow old, they are By the time they are old enough, they have become employees who wait for instructions.

We should conduct our hiring activities with the true intention of "We are looking for employees who are easy to deal with. and abolish the false business of recruiting consultants who deceive new employees.


Initiatives required of business successors

The following efforts are required of business successors who will succeed to the business in the future


1. acquisition of basic knowledge: Successors need to acquire explicit knowledge of business strategy, financial management, risk management, legal issues, human resource management, marketing, public relations, customer service, technological innovation, etc.

2. use of experts: Successors can acquire the tacit knowledge necessary for business success through the advice of experts (e.g., lawyers, accountants, tax accountants, financial advisors, management consultants).

3. human networking: Business successors can acquire tacit knowledge about business management through interaction with senior managers, managers of other companies in the same industry, and government support organizations in the community.

4. Continuous learning: It is important for business successors to continuously collect explicit knowledge about the business, identify trends, and learn about other companies' case studies.


Importance of Marketing Research for SMEs in Rural Areas

In general, marketing research has the following advantages for small and medium enterprises (SMEs) in rural areas where the market size is small


1. understanding of market needs: Marketing research helps to understand market needs and trends, which can then be used for the development of products and services. This can then be used to develop products and services.


2.Gather information about your competitors: Marketing research allows you to gather information about your competitors' products, services, and sales strategies, which can be used to differentiate and sell your products and services. This can help you differentiate your products and services and improve your sales strategy.


3. attract new customers: Marketing research can help you understand the needs and preferences of new customers. This allows you to offer products and services that will attract new customers.


4. improve satisfaction of existing customers: Marketing research can help you understand the needs and dissatisfactions of your existing customers, so that you can offer products and services that will attract new customers. This can lead to increased customer satisfaction.


5. to promote sales: By conducting marketing research, you can gather information that will lead to sales promotions. This can improve promotional strategies.


However, many local SMEs do not conduct marketing research. The reasons cited for this are lack of funds, capacity, and knowledge, and as a result, product-out approaches are prevalent. Initiatives that ignore market needs because they seem to sell on a whim, because they are socially significant, or because they make use of a local specialty will surely fail.


Unlike large corporations, small and medium-sized enterprises do not have the management resources to manufacture product products and to conduct trial and error.


Therefore, there is a strong need for managers to earnestly learn about and engage in marketing research. Managers who cannot learn should leave immediately.


The Need for High-Value-Added Products in SMEs

The reason why high value-added products are important for SMEs is to remain competitive.

To counter inflation and cope with shrinking demand, SMEs will be required to develop and offer products incorporating more advanced technology and design to the market in FY2024 and beyond.

SMEs can differentiate themselves from competitors by offering products that meet customer needs.

In addition, while high value-added products are more expensive to produce, they tend to have higher profit margins. Therefore, SMEs can increase their revenues by developing and selling high value-added products.

However, in order to develop high value-added products, it is necessary to secure and train personnel with more advanced skills and designs. Therefore, SMEs need to focus on recruitment and training.


The Importance of Knowledge Absorptive Capacity in Knowledge Spillover

Knowledge spillover refers to the informal acquisition and use of new knowledge to commercialize products and services in the marketplace (Cuvero, Granados, Pilkington and Evans,2019). Fallah and Ibrahim (2004) also argue that knowledge spillover is the unintentional transfer of knowledge to others across intended boundaries, and in any interaction, there is the possibility of knowledge exchange, and knowledge spillover depends on the ability of the recipient to absorb knowledge (absorptive capacity), the ability of firms to absorb knowledge depended on the experience and training of their personnel.


Knowledge spillover plays an important role in corporate and regional innovation. Knowledge spillover allows firms and regions to absorb not only their own knowledge, but also the knowledge of other firms and regions, leading to innovation.


Therefore, the ability to absorb knowledge through knowledge spillover is a very important factor for corporate and regional innovation.




Advantages of Establishing a Café in a Factory

Whether or not a manufacturing company can attract customers by establishing a café in its factory is difficult to say, as it depends on the products and services of the manufacturing company and the needs of its customers, but there are some examples of how establishing a café in a factory can help a manufacturing company to attract customers.


1. By setting up a café during factory tours, customers can rest in the café and purchase souvenirs before or after the factory tour.

2. The café can also provide space for product displays and sales. This will allow customers to see and touch the products in person and increase their understanding of the products.

3. The café can also show a video introducing the manufacturing process of the products. This will help customers understand the manufacturing process and increase their confidence in the product.


As described above, establishing a café in a factory can be expected to increase customers' interest in and understanding of the products.


What to Consider When Starting a Business in a Rural Area

Starting a business in a rural area presents different challenges than in an urban area. For example, the small population in rural areas tends to result in smaller business sizes. In addition, many people in rural areas tend to be concerned about the lack of knowledge and know-how related to entrepreneurship and the absence of consultants due to the lack of universities and support institutions. Therefore, it is important to pay attention to the following points when starting a business in a rural area.

1. understanding the characteristics of the region: Rural areas have different characteristics from urban areas. It is necessary to understand the industrial structure, demographic composition, and cultural background of the region, and build a business model suited to the region that addresses the declining population, falling birthrate, aging population, low disposable income, and high rate of business closures.

2. to leverage local human resources: Rural areas have their own unique human resources that are not found in urban areas. By utilizing local human resources, you can develop a business that is rooted in the region.

3. take advantage of local support systems: Rural areas have support systems that are different from those in urban areas. By utilizing local public support systems, such as chambers of commerce and industry, it is possible to raise funds and acquire business know-how.

4. utilize local networks: Rural areas have networks that are different from those in urban areas. Utilizing local networks, such as small and medium-sized business associations and youth organizations of chambers of commerce and industry, will enable collaboration and information exchange with local businesses and organizations.

5. addressing local challenges: Rural areas have different challenges than urban areas. By introducing services that exist in urban areas but not in rural areas and developing businesses that address local issues, you can contribute to regional development.

By paying attention to the above points, you can successfully start a business in a rural area.


How to approach price pass-through

On September 19, 2023, we held a pricing seminar "Understanding the Current Situation" to review the prices of current products, goods, and services. On February 27, 2024, we plan to hold a pricing seminar for new products, goods, and services, entitled "New Initiatives. The following is an overview of the "Understanding the Current Situation" seminar, which will focus on reviewing the prices of current products, goods, and services. In recent years, the Japanese economy has seen a widespread trend toward price increases in a wide range of sectors, including food, services, electricity, and gas, in response to soaring raw material and logistics costs. This is due to the following factors

1. Soaring raw material and fuel prices: due to the Corona disaster and Russia's invasion of Ukraine. Global supply shortages and supply-demand imbalances due to the Corona disaster, Russia's invasion of Ukraine, etc.

2. logistics slowdown: international cargo transportation delays due to travel restrictions, container shortages, etc.

3. Labor shortages: Labor shortages due to falling birthrates, aging populations, and a decrease in the number of foreign workers

4. Weakening of the yen: Rising prices of imported goods due to the yen's depreciation against the dollar, euro, etc.


Rising prices are a major challenge not only for consumers but also for companies. Companies generally need to take the following measures to cope with increased costs of raw materials, labor, etc. Companies need to select and implement the most appropriate measures according to their own situation and market environment.

1. Price pass-on: Reflecting cost increases in the prices of products, goods, and services

2. Cost reduction: Finding substitutes for raw materials and parts, improving efficiency of production processes and logistics, etc.

3. Value-added enhancement: Adding new functions and features to products and services to enhance brand image and customer satisfaction.

4. Value-added enhancement: Adding new features and functions to products and services to enhance brand image and customer satisfaction In order to cope with rising prices, it is important for companies to first implement price pass-through, considering the current situation.


In the "Understanding the Current Situation" section, we explained and addressed the following

 Understanding Cost and Grasping the Current Situation The participants confirmed and understood what elements make up cost of goods and services, how much each element costs each year, and the approximate percentage of each product, commodity, or service.

 From Gross Profit to Sales Price and Selling Price Listing Based on the ideal gross profit and cost of sales, the ideal selling price was identified. Based on these, we created a list of selling prices.

 Clarification of products, goods, and services to be sold (Principle 2.8) The top 20% of transactions and the 20% of products that the company would like to sell in the future were clarified.

 Clarification of products, goods, and services to be sold, their features, and specialties The top 20% of products, goods, and services to be sold, their features, and specialties were described and clarified.

 Prepared materials to explain price review to customers and suppliers Analyzed cost increase factors based on profit and loss statements from previous years, and prepared materials for customers and suppliers explaining price revisions based on the sales price list. The company will use these materials to negotiate prices in the future.

 Initiatives for set sales, regular delivery sales, and online sales outside of your City In order to acquire new sales channels in addition to existing sales channels, the company considered the possibility of selling multiple products, goods, and services in sets that have mutually complementary functions, selling regular subscriptions, and selling online outside of your City.

Price negotiation is necessary to achieve price pass-through. In price negotiations, advance preparation is extremely important. The first step is to present objective evidence, such as cost calculations and market trends, in order to reach an agreement with the ordering company. In price negotiations, it is also necessary to emphasize the importance of the relationship with the other company. In order to build a long-term business relationship, it is important to aim for an agreement that is acceptable to both parties.

Finally, negotiation techniques are also effective in price negotiations. For example, "give the other company several options," "negotiate with a good understanding of the other company's position," and "divide negotiations into short-term and long-term time frames. In order to promote price negotiations, it is generally effective to utilize public support systems. Fukui Prefecture has set up a consultation service at the Fukui Prefecture Subcontracting Kakekomiji and Fukui Prefecture Yorozu Support Center to support price negotiations by small and medium-sized subcontracting firms. In addition, every September and March are designated as "Price Negotiation Promotion Months," and companies on the ordering side are encouraged to cooperate in passing on prices to their suppliers. In times of rising prices, companies that do not have the ability to determine prices are unable to raise product prices even when raw material and labor costs rise, resulting in lower profit margins and, in the worst case scenario, the threat of bankruptcy. To avoid falling into such a situation, it is important for companies to actively collect, analyze, and implement information on advanced approaches taken by other companies on a regular basis so that they can respond flexibly.

In order to survive in this era of rising prices, companies must improve their ability to absorb knowledge that will enable them to collect, analyze, and implement information and respond to change. Companies that feel a strong sense of closure in their current situation and companies that want to be reborn as high value-added companies are encouraged to attend the 3. Thinking about value-added enhancement, please join us for the "New Initiatives" section of the Price Seminar for working on new products, goods, and services. We look forward to seeing you there.


The Noto Peninsula Earthquake of 2024

I would like to express our deepest sympathies to the victims and their families of the Noto Peninsula Earthquake of 2024. I sincerely hope for your safety and the earliest possible recovery of the afflicted areas. I pray that the lives of those affected by the earthquake will be restored to normalcy as soon as possible.


Encouraging Participation in Online Reading Sessions

Online reading groups are events where people exchange their thoughts and opinions about books via the Internet.

Strategic Organization Consulting, LLC holds regular reading groups on the basic texts used in MBAs. Currently, we are conducting reading sessions on Bernie's Theory of Strategy and Kotler's Theory of Marketing.


The benefits of participating in an online reading group are varied, but can be listed below.


1. a chance to read a book: In order to participate in a reading group, you need to have read the book for a predetermined assignment. Therefore, participating in a reading group will help you get into the habit of reading.

2. deepen your reading by listening to other people's impressions and opinions: In a reading group, you will learn that even if you read the same book, your impressions and opinions will differ depending on your different experiences. Understanding a book from another person's point of view can lead to new discoveries.

3. no need to travel: With an online reading group, you can participate from the comfort of your own home or wherever you like. This makes it convenient and easy to participate.

4. Connect with people who are far away from you: Online book clubs make it easy to connect with people in other parts of the world. You can make friends with other founders and hear about their experiences of starting a business in a different environment.