The Business Deployment of Formula Feed Manufactures : A Case Analysis of Kyodo Shiryo Co., Ltd.

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Other Title
  • 配合飼料メーカーの事業展開 : 協同飼料株式会社を事例として
  • ハイゴウ シリョウ メーカー ノ ジギョウ テンカイ キョウドウ シリョウ カブシキ ガイシャ オ ジレイ ト シテ

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Abstract

This article attempts to analyze the developing business of manufacturing formula feed, a product essential to the contemporary livestock industry, in Japan. I identify three phases in the Japanese industry's development. From the 1960s to 1970s, rapid market growth prompted manufacturers to engage in capital expenditure to enlarge plant and marketing channels in response to new demand. However, severe market competition hobbled market growth and cut into manufacturers' profits from the mid-1970s to the 1980s. Manufacturers integrated their operations to sell directly to customers and thereby avoid price competition and secure market share, but they could not increase profits because of the high cost of promoting sales. From the late 1980s to 2000, manufacturers sought further integration with their customers through the one-to-one correspondence production system engaging to sell specific kinds of feed to specific customers on a made-to-order basis. This was an attempt to cut promotional costs and expand market share. It was partially effective but still there was only limited improvement in profit ratios. I conclude that the order-made formula feed business relied on a modern transaction system between manufacturers and the large-scale farms that were their clients. The manufacturers' concentration on the order-made formula feed business resulted in reducing the overall scale of the market because manufacturers dealt only with a limited range of farms.

Journal

  • The Journal of Agrarian History

    The Journal of Agrarian History 44 (4), 20-36, 2002

    The Agrarian History Society (Renamed as The Political Economy and Economic History Society)

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