ADVERTORIAL FEATURE
Japan : the small businesses with big opportunities
Please remember that the value of an investment can fall and you may not get back the amount invested .
Many years ago , a man walked into a Japanese inn after a motorbike ride in the countryside . The visitor ’ s colourful crash helmet caught the young innkeeper ’ s eye . They got chatting and struck up a strong bond . The guest went on to be the founder of Honda . His host started designing helmets of his own and launched premium helmet-maker Shoei . Honda eventually adopted the manufacturer as its favoured supplier of helmets . While Honda is the name that ’ s known to almost everyone , it is Shoei and its “ sci-fi futuristic ” helmets that piqued the interest of Praveen Kumar , manager of the investment trust Baillie Gifford Shin Nippon . He cites Shoei as an example of Japan ’ s rich layer of small and medium-sized enterprises ( SMEs ) that excel in a particular business niche and that often prove themselves to be “ refining manufacturing techniques to end up with a premium product ”. Kumar defines SMEs as companies with fewer than 300 employees and less than $ 1.5bn in market capitalisation . Japan has over three and a half million small and medium-sized businesses . They employ about seven in 10 workers in the private sector . “ To me , this swathe of SMEs forms the beating heart of Japan ’ s economy ,” he says . “ For a long time , they have just been overlooked . Not just by overseas investors but , funnily enough , by a lot of domestic
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