29
NISSHO IWAI SEAFOODS INC.

In April, 1986, Nissho Iwai Seafoods Inc. was registered
as a company formally. The construction still hadn't been
started.
I was promoted by Mr. Honda, as sales manager of the
new company. It was a jump up in my career.
I remember feeling some kind of invisible power pushing
me forward and I worked hard to respond to it.
The headquarters of the new company was still located at
Nest-duck for the time being. A new car with a logo of Nissho
Iwai Seafoods was delivered; visiting cards of the new
company were supplied. Actual parts of the new company
were starting to appear.
On September of the same year, the construction of the
new plant was completed and the headquarters were transferred
there.
A new life started for me. Daily I took a two hour ride on
the train to get to the office in Funabashi. At the station of my
destination, there was supposed to be a scheduled bus waiting
for the employees to take them to the plant, which was still a
long way from the station. If you had missed that bus, you
had to take a 20 minute walk. The walk through the reclaimed
land was not an enjoyable one, so later, I bought a bicycle.
The men from Nissho Iwai were assigned for the major
positions of the new company such as: president; vice
president; sales manager; accounting manager.
The position of head sales manager and sales manager were
my former boss at Toukai Fish Fillets and me.
Mr. Honda was not hired for the new company and
remained independent as the president of Toukai Fish Fillets.
He was to be in charge of the production line.
As the foreman of the production line, a man whom Mr.
Honda had head-hunted from another fish processing company
joined.
Workers of the production line were transferred from the
old Toukai Fish Fillets.
The daily work and business of Toukai Fish Fillets had to
be transferred to Nissho Iwai Seafoods without a day's
interruption.
The fish stock list was so complicated since the numbers
changed randomly, products increased and shipments
decreased, that it was almost impossible to keep track of
everything. We had to work endlessly, trying to make ends
meet, but actually, there was no one except the head sales
manager and I who could understand what to do about the
daily work.
We worked until midnight every day. The hundreds of
tons of frozen raw material and more than 300 kinds of items
processed from them had to be checked. They were all in the
minus 40 degrees centigrade freezer, so the check was a very
hard thing to do. It was necessary to check first, if the stock
on the list really existed. Trying to find something that doesn't
exist is impossible and therefore takes time. Always before
the check was completed, the balance was changed, so after
half a year, we couldn't even stand at the starting line.
Every night, I had to drive the people of Nissho Iwai
Seafoods to the nearest station since no other transportation
was available.
Since the balance of account wasn't reached every day or
every month, Nissho Iwai urged strongly their ex-employees
to clear up the task. The people from Nissho Iwai, mostly the
top management of the new company, gave orders to the
workers regarding what they were told from their main
company but, <..pipe unto you and ye have not danced,> it
was useless. The Nissho Iwai men didn't understand why.
It was because this idea of the new company was more an
armchair theory than putting man on Mars.
It was logically possible but actually impossible. Imagine
numbers of wooden pallets with enormous kinds of items in
small numbers piled up high to the ceiling in the freezer: they
are easy to collapse; the temperature is minus 40 degrees; ice
is everywhere. Defrosting is needed since people open the
door to check out what does not exist, and ends up only bringing
in moisture.
Pallets were so stacked up that power lifts were of no use.
Eventually, man power was the only thing to depend on. But
it was so weak a power since the workers got so easily chilled
up and they had to risk the danger of being hit by falling pallets,
or slipping on ice. And when certain times came, newly
processed products would flood into the space. They had to
be put upon certain pallets depending on the grades and species
of fish.
When shipping out time came, numbers of each item had
to be prepared according to the orders received from customers.
This had to be done under the "first-in, first-out," basis.
Non-delivery to supermarkets had to be strictly avoided,
so products were prepared always in rather excessive numbers.
This turned out to be the main reason of causing loss while
holding in the freezer. The "first-in, first-out," principle was
not obeyed much because of the many reasons mentioned
before. Early made products were likely to be at the bottom
of the piles, so you had to take off what was piled up upon
them to ship them out fairly.
The time allowed was limited, so workers didn't obey the
principles.
Fish put on pallets and placed at the bottom of the piles
was very likely to get old and spoilt.
A more simple system -- one I already mentioned in the
chapter of "Norwegian Herring," i.e. to sell out daily pro-
ductions -- was necessary. Although, in the first place, the
general concept of Nissho Iwai Seafoods was to trade with
supermarkets only: not with the wholesale markets. The defect
of the new company, that it was not profitable constructionally,
was coming in sight. Though, it wasn't in sight of the people
from Nissho Iwai yet. The sight was similar to the picture of
the whole fish business world.
For the Nissho Iwai people, unseen losses increased for
unknown reasons. This led the management to become
suspicious. Embezzlement was suspected. The weirdness of
the fish stocks disappearing was like the weirdness of the
melting black cod.
Every month the accounts showed large deficits, but there
were no basis in figures to seek how to improve it. The people
who came from Nissho Iwai were accused by the main
company. A bad mood enveloped the new company.
As I have said before, I knew what was going on. But
alas, to the people from Nissho Iwai, my explanations only
seemed to be expressions of excuse and idleness.
Most of the Nissho Iwai people weren't able to get back to
the main company. All they could do was quit. The subsidiary
became to be like the grave of elephants of Nissho Iwai. The
good old days of paternalism and life-time employment had
gone away.
Two years passed. It was 1988, and there was still no one
who would mention about giving up this project. Although,
the frustrated mood that there was no way -- no matter how
hard you tried -- to improve deficits was there to stay.
Generally speaking, there are companies that drop out of
line, here and there. To my way of thinking, in any case, keen
people seem to quit first.
At least, it was so in Nissho Iwai Seafoods.
Hard workers quit and useless people remained. I was
probably among the useless.
I don't know if people quit because companies are bad, or
companies get bad because people quit. Anyway, once this
kind of thing happens, it cant be stopped any more.
But in the next year 1989, the whole Japanese economy
started to rise suddenly. Real estates and stock market prices
went up. This was the coming of the so-called Japanese
"bubble economic boom."
The real estate price of Nissho Iwai Seafoods in Funabashi
also rose up 10 times the price it used to be in 1988. It increased
the assets to allow the company to survive a little bit longer.
But from the eyes of the real world of business, bubble
economy was nothing formative. It took away from people
efforts towards development and sincerity. The saved Nissho
Iwai Seafoods decided to newly join the tuna business, a large
share-holding item in the fish business, and invested in the
latest processing machines. But it didn't become a solution to
rebuild Nissho Iwai Seafoods at all.
I would say again that the producers lost profit because of
the decline of the wholesale markets. Wholesale markets were
major customers of off-grade fish. To make up those losses,
wholesale markets increased its weirdness. The fall of the
market prices caused a feedback to supermarket prices. This
struck the producers again.
It can be said that supermarkets are selfish since they take
only the best, main, or most valuable parts of the complex and
limited natural resources. This kind of thing would not last
long. Influence of this weird and vicious circle of fish
distribution and the prices would soon make consumers lose
their interest and taste towards eating fish.
Cutting-down-equilibrium was a solution for nothing in
the depressed fish business world. The only way to solve the
problems was to expand business. This was what I had insisted
at Nissho Iwai Seafoods again and again.
Expanding business was to cover the whole business world,
inside and outside the wholesale market, in other words,
through wholesale markets, supermarkets and other retailers.
Natural resources that God had given to men should have been
distributed here as a whole to be spent without waste. It would
have been just the same thing that I had done in the sales of
the ATC red salmon or Norwegian herring, but on a larger
scale.
This would have needed though, a lot of sacrifice and
investment, which were reasons why people didn't listen to
me at all.
Every year, Nissho Iwai Seafoods showed 20 million yen
of deficit. Even in such situations, the management didn't
step into small risks and investments for the future.
Throughout Japan, conservation is the ruling power of
business. Long term and risky dreams are never to come true.
I watched TV one day. The subject was about some
Japanese young scientists developing an aircraft that needed
only a very short runway to take off. In the program, the
scientist said,
"A large amount of money is needed to develop this kind
of jetplane. Although, no one invests for us since we don't
have expectations to sell it yet. No one actually pays money
for dreams in this country."
This kind of aircraft seems quite useful to develop for a
land like Japan, but things are not so easy in the real world,
perhaps. This probably means that the Japanese would never
have been on the moon by themselves.
In 1990, four years after the establishment, Nissho Iwai
Seafoods went out of business. The total of the deficit reached
10 million dollars, it is said. At the very beginning, the cost of
this whole project, including buildings, machinery and real
estate, was 40 million dollars.
The sum of deficit and cost is 50 million dollars.
l don't know if I am proving something by these figures,
but 50 million dollars equals the price Nissho Iwai sold the
real estate, after making it plain land, to a meat processing
company in 1991.
Coincidental or not, these figures sure are ironical.
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