Introduction

The decade of the 1920s was an era of great difficulties for trading companies in Japan. A number of large trading firms became insolvent: Mogi Shōten, Furukawa Shōji and Kuhara Shōji during the crisis of 1920; Takada Shōkai in 1925; and Suzuki Shōten during the financial panic of 1927 were representatives. Moreover, even those trading firms which barely escaped bankruptcy often suffered severely from widely fluctuating incomes which accompanied losses in the worst situation or from stagnating at low income levels as shown for the firms excluding Mitsui Bussan in table 15.1. However, in what was a period of hardships for most trading firms, Mitsui Bussan performed exceptionally well, continuously attaining high profit rates. Its profit rate, as shown in table 15.1, remained almost constant at around 15%, and stood out in sharp contrast to the movement and the level of other traders' profit rates. The purpose of this chapter is to look into the factors behind the superb managerial performance of Mitsui Bussan during the 1920s.

The characteristic features of Mitsui Bussan's commodity transactions

The close relationship between its commodity transactions and key industries

Mitsui Bussan was not a mere trading company but also was active in sideline businesses such as marine transportation, shipbuilding, agencies for ocean transport and insurance, and was rapidly taking on the characteristics of a holding company at this time.