From exports to local production: building a soy-sauce plant in Wisconsin (1972)

Choosing to build a plant beyond exporting

The heart of this decision lies in refusing the safe road of going on earning through exports, and instead putting into a plant across the ocean a sum larger than the company’s paid-in capital. Soy sauce is a fermented food whose taste turns on the microbes that live in the brewery, and whether that quality could be reproduced in a foreign country was something no one could guarantee until it was actually brewed there. From sales beginning in 1957, Kikkoman had grown demand at the American table, and on the strength of that feel it chose the uncertain future of local production over the certain profit of exporting. It was a decision to divert funds to the next investment in the very midst of a thriving business.

Local production was not merely a way to hold down freight costs and currency swings. By rooting the plant in its region and carrying itself as “America’s Kikkoman,” the company built a wall of entry that later arrivals could not easily breach. In moving to foreign soil both a slow, time-consuming fermentation technology and the trust of the local community, there is a meaning that goes beyond a simple extension of exporting. Today’s figure of roughly seventy percent of sales from overseas rests on the years spent, half a century ago, reproducing the taste and persuading the neighbours on Wisconsin farmland. This choice to build a plant beyond exporting left one template for the overseas expansion of Japan’s food industry.