The purpose of this paper is to analyze the change in the relationship between suppliers and retailers in the Japanese apparel industry from the 1970 to 1980s. In the 1970s, the Japanese apparel market entered a new phase. With each season, the price of apparel products began to fall more sharply than ever before. Both the suppliers and retailers tried to cope with the new market conditions, and in the process their relationship changed, with the large apparel suppliers integrating retail functions into their business. Some new apparel suppliers, who had wholesaled their products mainly to specialty shops, tried to maintain the value of their products by controlling the way they were sold to consumers. World Co. Ltd. established its own sales network from the late 1960s because most big specialty shops controlled their shop floors and were reluctant to sell World's new sets of products under World's instructions. Then a number of medium-sized specialty stores were organized and managed under the guidance of World. Some smaller apparel suppliers, called Designer's and Character (DC) brand-makers, produced fashionably designed products and made a big hit in the early 1980s. Their products were sold mainly at shops under the direct management of DC brand-makers. These new apparel suppliers established their brand value and rapidly expanded in the 1970s-80s. The large and established apparel suppliers had wholesaled their products mainly to big department stores. In the 1970s-80s, many big department stores left the management of each division and selection of products for sale in the hands of large apparel suppliers. But even these established apparel suppliers had little choice but to integrate retail functions in order to keep their transactions with department stores. They soon adopted the same strategies as the new suppliers had, and they integrated retail functions on their own initiative to enhance their production and sales systems. In this way, the relationship between suppliers and retailers changed, and quite a few suppliers acquired retail functions, and the Japanese apparel industry continued its transformation until the early 1990s.
Studies on entrepreneurs in the machine/metal processing industry have emphasized their technical contributions-as technicians and inventors-to business development, and most of these studies have focused on entrepreneurs in urban industries. We investigated Genzo Matsuyama, the founder of a small agricultural implements factory in Nagano Prefecture in 1902, which was an impetus for growth of the local economy. The factors that contributed to the establishment of Genzo's factory were his passion for agricultural reform, financial backing from Shintaro Tanaka, and the assistance of local iron factories. After Genzo overcame his start-up troubles, which lasted from 1902 to 1906, and with Shintaro's aid, sales channels of plows began to significantly expand in 1907, resulting in a much more stable business. The main sales channels expanded as a result of the diligent effort made by Genzo and peoples who worked to improve farming techniques and also due to the support of certain influential traditional retailers. The money required to expand operations was raised from local asset holders and banks. Local suppliers initially provided the parts that were used in production. In order to ensure quality and increase production, in-house manufacturing of parts was started along with the procurement of parts from suppliers in Tokyo. For the minimization of labor costs, a production control system that utilized surplus labor during the lean months was developed. This system took advantage of the seasonal demand for plows and the setting of factory in the rural district. Genzo successfully expanded sales channels, fund raising, and production facilities. The most remarkable point is that local entrepreneurs such as Genzo played an important role in coordinating various business resources embedded in the local economy.
The Hino Pharmaceutical Co., Ltd is headquartered today in Hino-Cho, Gamo-Gun, Shiga Prefecture, Japan. The medicine Shono Manbyo Kannohgan, produced by this company, originally derives from Shinnoh Kannohgan, a traditional medicine that was manufactured for generations by the Shono Genzo family. This family had been engaged in the business of drug manufacture (called awasegusuri in Japanese in those days) since the Genroku era (1688-1704). During the Edo period (1603-1868), distribution of awasegusuri was strictly controlled by as well as dependent on the policies of Shogunate regime. Thus, after the Shogunate collapsed, many pharmaceutical companies could not maintain their businesses. Despite the collapse of the economic system under the Shogunate, however, some of them, such as the Shono family, survived and continued their traditional trade until this day as a company, During the Edo period, the awasegusuri sales network of the Shono family consisted of special agencies that were each assigned a specific sales territory. Ohmi merchants were dominant among these agencies. The Shono family's success is due to its feature of modernity, which is a distinct characteristic of the Ohmi merchants' management style. The reason why the awasegusuri business was accepted by many Ohmi merchants was because the Shono family was a family of high repute. The fact that the Shono promoted the pharmaceutical industry in the Hino area contributed to this family's fame.