A mochi seller in Kyoto, and many of Japan’s other centuries-old businesses, have endured by putting tradition and stability over profit and growth.

By New York Times

A very interesting article which you can read here in detailed. 

What I find interesting about Ichiwa, is a very small business and yet it had survived for over a thousand years. It has weathered through wars, plagues, natural disasters and the rise and fall of empires. But its rice flour cakes and the methods of making them has remained the same since it first began selling.

Most businesses usually maximize their profits, scale up their size, market share and growth rate but Ichiwa’s priority is survival. To them, each generation is like a runner in a relay race and what’s important is passing the baton to the next. But how do they survive for so long without focusing on profit?  

According to Ms. Hasegawa, the operator of Ichiwa, a business cannot just chase profits alone, it has to have a higher purpose. Those kinds of core values, known as “kakun,” or family precepts, have guided many companies’ business decisions through the generations. They look after their employees, support the community and strive to make a product that inspires pride. 

The other reason it has endured for so long is because their aversion to risk and their accumulation of large cash reserves. Even when they make profits, they do not increase their capital expenditure. This is to ensure that they can continue issuing paychecks and meet other financial obligations in the event of economic crisis, like now during a pandemic.

But finding a balance between preserving traditions and adapting to quickly changing market conditions remains a challenge today. And another reason that keeps them going is because they hate the idea of being the one to let it go or shut the business down as they see it as sense of pride and duty in running a family business for over a thousand years.

Lesson Learnt

One thing we can learn from this is to control our cashflow. Maintaining our spending or lifestyle despite the increase in our monthly salary just so you could use the extra cash saved when you get retrenched in times of uncertainty such as now, while you find a job. 

It is during the pandemic that people began to realize the true value of things, differentiating things that you need and things that you want. Luxurious items no longer appeal to the masses like it once did, now it’s all about survival. We are going back down the Maslow Hierarchy of Needs. 

Now it’s about keeping food on the table, keeping the electricity and water running in your house, and keeping your family safe. No one care about what brand of phone you are using or what brand of vehicle you are driving, as long as you have them that fulfill it’s practical purpose in times of need.