Japan’s Oldest Businesses Have Survived for More Than 1,000 Years

Monday, February 23rd, 2015

Japan’s oldest businesses have survived for more than 1,000 years:

Century-old American companies like General Electric and Ford appear ancient when viewed alongside modern upstarts like Google and Facebook. But there are a number of Japanese firms — some of which have been around for more than a millennium — that exist on another scale of time entirely. Japan is home to some of the oldest continuously operating businesses in the world, among them a 1,300-year-old inn and a 900-year-old sake brewer.

While this longevity is not confined to East Asia — the Italian gun manufacturer Beretta has operated since at least 1526 and the cymbal maker Zildjian was founded in 1623 in Turkey — these Sequoia-like firms are relatively common in Japan. The country is currently home to more than 50,000 businesses that are over 100 years old. Of those, 3,886 have been around for more than 200 years. As a point of comparison, only one in every four U.S. companies founded in 1994 was still operating in 2004, according to the Bureau of Labor Statistics.

But in the past decade, some of Japan’s oldest businesses have finally shut their doors. Last month, the roughly 465-year-old seafood seller Minoya Kichibee filed for bankruptcy, which came after the news last year that the 533-year-old confectioner Surugaya met a similar fate. In 2007 — after 1,429 years in business — the temple-construction company Kongo Gumi ran out of money and was absorbed by a larger company. Three companies going bust doesn’t quite make a trend, but it seems like there has to be something larger going on if a company that’s been around for more than a millennium suddenly blinks out of existence.

The first question to ask about a company like Kongo Gumi is why it stuck around so long in the first place. For one thing, these companies tend to be clustered in industries that never really go out of style. Kongo Gumi specialized in building Buddhist temples — a pretty dependable bet in nation with a strong Buddhist history. The company’s first temple, near Osaka, was completed in 593, and has been rebuilt six times since then (by Kongo Gumi, of course). “There’s a pattern,” William O’Hara, the author of Centuries of Success, told The Wall Street Journal in 1999. “The oldest family businesses often are involved in basic human activities: drink, shipping, construction, food, guns.”

The other reason these companies proliferate in Japan is because of how the country’s family-run businesses have been passed down through generations. Japanese business owners typically bequeathed entire companies to their eldest sons, and there’s a 10-foot-long 17th-century scroll tracing all of Kongo Gumi’s previous owners. But what fostered corporate longevity was that owners were permitted some leeway if they didn’t trust their offspring to take the helm: They could adopt a son, who would often marry into the family and go on to run the business.

Japan has recently moved away from its traditional banking culture, where banks were supposed to bail out such companies, and many traditional products have lost their allure, too.

(Hat tip to T. Greer.)

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