Nichirei
Corporate History & Strategy

In the early 1940s, Japan was under a total war mobilization system, and marine products were positioned as strategic materials supporting protein supply to the nation. Under wartime control orders, the government identified the inefficiency of cold storage, ice-making, and freezing shore operations individually held by fishing companies, and directed their consolidation under a single entity. The aim was to simplify logistics and optimize resource allocation, prioritizing supply reliability over private enterprise competitive principles.

At the time, many of the freezing and ice-making plants originated from small and medium-sized operators based at local ports. Through past industry restructuring, these had come under the umbrella of major fishing companies such Nippon Suisan and Hayashikane Shoten, but as shore operations, they continued to be managed in a dispersed manner. While nominally a consolidation of major capital, in substance it bore the character of an aggregation of small and medium-sized ice-making companies.

At a time when household refrigerators were not yet widespread, ice-making operations were indispensable for fresh fish distribution, and a dispersed base configuration with ice-making and cold storage plants at each port was practically required. Against this backdrop, the concept of consolidating freezing, ice-making, and cold storage shore operations as a national policy took concrete form.

In December 1942, Imperial Fisheries Control Co., Ltd. was established under government direction. The contributors were major fishing companies including Nippon Suisan, Nichiro Gyogyo, and Hayashikane Shoten, and the capital of 50 million yen was primarily composed of in-kind contributions of cold storage and ice-making plants held by each company. The company inherited approximately 220 freezing, ice-making, and cold storage plants across the nation, and was positioned as a state-controlled company to centrally manage shore operations.

This consolidation was not an individual company's growth strategy but a decision that prioritized national supply-demand management. The designation of ice-making as the core business also reflected the strong practical demand for supporting fresh fish distribution. The dispersed operations with plants at each port were preserved even under the control system, and the nationwide base network became the new company's business foundation as-is.

From the point of establishment, a company possessing cold storage and ice-making infrastructure on a national scale had been created. In that the business scale was formed through blanket state-directed consolidation rather than inter-company competition, this was an origin fundamentally different from normal corporate growth.

With the end of the war in 1945, state-controlled companies were being dismantled in various sectors, but Imperial Fisheries Control chose to continue its business. In December of that year, it changed its name to Nippon Reizo Co., Ltd. and re-launched as a private enterprise centered on cold storage warehousing and seafood processing. The nationally dispersed factory network constructed during wartime had the effect of diversifying regional risk and functioned as a revenue source even in the unstable postwar supply-demand environment.

In 1949, the company listed on the Tokyo Stock Exchange and settled capital relationships with major shareholders such as Nippon Suisan. Its positioning was transformed from a subcontractor of specific fishing companies to an independent cold storage and seafood processing company. In January of that year, it also underwent a process of restructuring 1,000 employees to correct the redundancy of the wartime structure.

By the mid-1950s, the company secured the top domestic share in the ice-making sector, establishing a near-monopoly position. The factory network dispersed across approximately 170 locations nationwide provided diversification of regional risk and stability of diversified management, serving as the foundation for consistent earnings each period. The political decision-making of wartime control ultimately remained as a source of competitive advantage over the long term.

In the postwar period, Nichirei's business centered on cold storage warehousing and seafood processing, with the company in a subcontractor-like position to fishing companies. While the cold storage and ice-making equipment business generated stable earnings, its sources of value-add were limited, and sales growth faced structural constraints. Around 1950, the Japanese economy was entering its recovery phase, and demand for processed foods was gradually expanding, particularly in urban areas.

Kokojiro Kimura, who assumed the presidency in August 1951, had a background at Nippon Suisan and had transferred to Imperial Fisheries Control during the war. Kimura questioned the very business model of dependence on storage and primary processing, and believed it necessary to transform Nichirei from 'a company that owns facilities' to 'a company that sells food.' This awareness became the starting point for the aspiration to become a comprehensive food manufacturer.

For Nichirei at the time, cold storage warehousing was the foundation of stable earnings, but the ceiling for growth was already visible. Cultivating the food business as a new revenue source required a mindset shift from storage to manufacturing, and the change in management provided that catalyst.

Under the Kimura leadership, Nichirei launched a full-scale entry into processed foods beyond just seafood. From the 1950s through the 1960s, the business was expanded across five areas: seafood products, frozen foods, processed marine paste products, canned goods, and livestock products. However, at this stage, 'which food category to focus on' was not clearly defined, and the business portfolio was expanded through trial and error.

The Comprehensive Five-Year Plan initiated in fiscal 1961 backed this direction with capital allocation. Over five years, a cumulative 17 billion yen was invested, with 8 billion yen allocated to the mainstay freezing-related operations and 9 billion yen to the food business, where growth potential was anticipated. While freezing remained the center of revenue composition, the decision was made to tilt capital investment toward food.

The core of capital investment was the reorganization of food factories. Existing food factories were small-scale and dispersed, lacking efficiency by product category. A comprehensive food factory was newly built in Funabashi, Chiba Prefecture, pursuing an integrated production system for ham, sausages, processed foods, and canned goods. The location selection proximate to consumption areas was also a decision conscious of mass production and logistics.

Through the 1960s, the development across the five areas gradually diverged in fortunes. Seafood products and canned goods proved difficult to differentiate, and processed marine paste products and livestock products faced competition from specialized manufacturers. In each area, Nichirei lacked the distinctive advantage needed to succeed as a late entrant.

On the other hand, in frozen foods, the company expanded primarily in the commercial-use market, leveraging its proprietary cold chain logistics network to form entry barriers. The cold temperature management capability inherited from the cold storage warehousing business had high compatibility with frozen food manufacturing and distribution, which translated into competitive advantage.

As a result, while the comprehensive food manufacturer path was maintained, frozen foods became established as the growth axis from the 1970s onward. The dispersed business development was inefficient in the short term, but it functioned as a process of field-testing the competitive environment in each area, providing the basis for subsequent judgment leading to concentration on frozen foods.

Through the 1960s, Nichirei's processed food business achieved sales growth and reached a level of profitability comparable to the freezing business. In the profit composition, the freezing business accounted for approximately 56% and the food business for approximately 46%, suggesting that the food business had entered a capital recovery phase. As a result, financial room emerged to reconsider investment in the freezing and cold storage sectors, which had been constrained during the food expansion period.

On the other hand, cold storage warehousing and cold chain logistics were equipment-intensive businesses with large initial investments. In the latter half of the 1960s, while revenue expanded, pre-tax profit did not grow at the same rate as sales, and there were constraints on funding growth investment solely from retained earnings. A tension between growth and finances was emerging.

For Nichirei, cold storage warehousing was the foundation of the business, and postponing equipment renewal and expansion would directly lead to declining competitiveness. With the food business's profits now in a recovery phase, the risk of missing the window for reinvestment in the freezing and cold storage sectors was recognized as a management challenge.

As of 1970, Nichirei made clear its intention to continue investing in cold storage warehousing and processed foods. What was distinctive was the acceptance of a plan in which capital investment consistently exceeded pre-tax profit. To prevent investment shortfalls from becoming a growth constraint, the shortfall was to be covered by bank borrowings.

From 1965 to 1970, capital investment expanded from 1.4 billion yen to 4.5 billion yen, while borrowing balances also increased from 19.1 billion yen to 23 billion yen. The debt ratio fluctuated from the high 40% range to above 50%, indicating a decision-making approach that prioritized sales growth over capital structure stability. Given the characteristics of freezing and cold storage as equipment-intensive industries, a leveraged expansion strategy was chosen.

This decision was based on the recognition that investment capacity had emerged as the food business's profit recovery progressed. However, a structure in which investment exceeding profit was supplemented by borrowings carried side effects of increasing sensitivity to interest burdens and economic fluctuations.

Under this investment policy, Nichirei's revenue doubled in five years from 36.4 billion yen in fiscal 1965 to 73 billion yen in fiscal 1970. The expansion of cold storage warehouse capacity supported increased handling volumes for frozen foods and seafood processing, contributing to the expansion of the overall business portfolio.

Meanwhile, the debt ratio remained elevated in the 40-50% range, and the financial structure gradually became rigid. The structure in which retained earnings could not keep pace with investment needs continued, and resilience to changes in the earnings environment was declining.

As a result, from the 1970s onward, Nichirei entered a state of simultaneously holding growth potential and financial constraints. Concentrated investment funded by borrowings achieved short-term sales growth but increased sensitivity to interest burdens and economic fluctuations. The decisions made during this period became a precursor that would later compel financial improvement and business selection.

From the late 1970s through the early 1980s, Japan's fishing industry was severely constrained by the introduction of the 200-nautical-mile exclusive economic zone, which significantly limited deep-sea fishing operations. Raw material fish procurement costs rose, and market volatility intensified, making the traditional model of mass catch and mass distribution increasingly untenable. Nichirei's seafood division did not hold fishing rights and operated on a purchase-centered business model, leaving it structurally exposed to raw material price fluctuations.

The combination of rising import dependence and exchange rate volatility generated cost increases that could not be absorbed by processing and selling margins. The seafood division fell into deficit around 1980, and the limits of a business model premised on handling volume expansion became evident. While seafood processing had been a business since the company's founding, structural changes in the external environment had made maintaining profitability difficult.

In response to the deficit, Nichirei undertook fundamental structural reform of its seafood business. The model premised on handling volume expansion was reconsidered, and a policy of restructuring unprofitable transactions and product lines was articulated. For raw materials with high price volatility and processing areas with low profitability, downsizing and withdrawal were considered, while remaining businesses were steered toward higher value-add and use case redesign.

This policy shift repositioned the seafood division from a volume business to a selective business. Decisions were made to allocate management resources toward the higher-growth frozen food and logistics sectors, and the weight of the seafood business within Nichirei's business portfolio was progressively reduced. The core of the structural reform was the refusal to treat the founding business as a sacred cow, instead reviewing resource allocation based on profitability.

By the first half of the 1980s, Nichirei's food business centered on frozen foods had expanded, representing a significant departure from the previous business composition centered on cold storage warehousing. Meanwhile, the company name 'Nippon Reizo' strongly evoked cold storage warehousing, and the gap with the actual business was becoming evident. In the consumer market, brand and corporate image were entering a phase where they influenced purchasing behavior, and a corporate image heavily oriented toward commercial and B2B operations had limitations for expanding household frozen food sales.

Internally as well, an awareness was emerging that changes in organizational culture and mindset were not keeping pace with business expansion. Establishing recognition as a food manufacturer required a fundamental renewal of the corporate image, including a name change.

In 1985, Nippon Reizo changed its name to 'Nichirei Corporation.' The aim was to sever the association with being a cold storage warehousing company and rebuild recognition as a comprehensive food enterprise. Simultaneously, the CI was renewed and a unified design centered on the 'N' mark was introduced. The intention was to signal the company's change of direction both internally and externally through visual consistency.

This name change went beyond an external branding initiative. Internally, company-wide campaigns such as 'Tomorrow's Nichirei' and the 'FN Movement' were launched, building up shop-floor-led improvement activities through quality management and workplace enhancement. A process was adopted to substantiate the name change in practice, with the mindset shift from a warehousing company to a food company promoted across the entire organization.

By the mid-1980s, the increase in dual-income and single-person households was driving simplification of home cooking, and frozen foods were recognized as having room for household market expansion. Frozen foods had high suitability in terms of shelf life and cooking time reduction, but the impression of being an extension of commercial-use products was strong, and use cases and consumption occasions for household use had not been sufficiently organized.

At Nichirei as well, frozen foods were expected as a growth area, but challenges remained in terms of profit margins and differentiation. Due to the nature of frozen products, their high shelf life made it difficult to increase turnover rates, and at retail sites, they were easily targeted for promotional discounting. The structure inherent in frozen foods meant that as unit prices fell and competitive entry increased, price competition intensified.

The difficulty of simultaneously achieving volume expansion and profitability was recognized, but having rebuilt recognition as a food company through the 1985 name change, establishing a presence in household frozen foods was a management imperative.

Triggered by the 1985 name change, Nichirei launched a full-scale marketing effort for household frozen foods. Redefining frozen foods as 'everyday food available anytime,' product designs aligned with consumers' daily time schedules were advanced. In 1985, the '24hr.' series was introduced, presenting frozen food use cases by explicitly indicating time periods and consumption occasions.

In 1986, household frozen foods for bento (lunch boxes) were launched, and in 1989, 'Harajuku Dog,' which had a track record in commercial use, was adapted for household sale with television advertising. The strategy combined product development and advertising to embed frozen foods in household dining. In 1994, microwave-only croquettes were introduced, with product designs that addressed the cooking behavior itself.

These measures were investments to reposition frozen foods from 'an extension of commercial use' to 'everyday household food,' characterized by the integrated deployment of product development, advertising, and channel strategy.

Through these measures, Nichirei produced multiple hit products in frozen foods, and the production system was also expanded. The results of factory consolidation and capital investment pursued since the 1970s materialized, and by the early 1990s, frozen food sales reached the 100 billion yen scale. The presence in the household market had clearly increased.

However, competitors were also focusing on frozen foods, and price competition intensified further. Due to the high shelf life of frozen products, inventory adjustments were easy, and promotional discounting became routine. While share grew, profitability struggled to improve, and the difficulty of differentiation became apparent.

In later years, then-President Teshima reflected that 'compared to the improvement in name recognition, we were lacking in efforts to communicate what kind of company we are.' The concentrated investment in household frozen foods brought sales growth, but the construction of 'buying because it's Nichirei' as a purchase motivation was not sufficiently achieved.

In the first half of the 1980s, Nichirei had positioned itself as 'New Nichirei' through the name change and CI renewal, but no product existed that could intuitively convey this change to consumers. While frozen foods and logistics had large business scales, they were difficult for consumers to associate with the company name, and the results of the corporate image renewal were not reaching consumers.

In 1982, the development department was separated from the business department, establishing a framework for new business exploration. Themes were sought that met conditions including room for technological accumulation, rarity of core materials, and business expandability. Among multiple proposals examined, the fruit 'acerola,' which has an extremely high vitamin C content, attracted attention. The rising health consciousness and the material's characteristic of highlighting food functionality were valued.

In 1988, Nichirei launched 'Acerola Drink' made from acerola. Acerola is a material that deteriorates rapidly in freshness and is difficult to process and preserve, and the compatibility with the freezing and cold chain management technologies the company had cultivated was the decisive factor. Raw materials were primarily sourced from Brazil, and with an eye toward potential supply concerns, cultivation and processing systems were also being established locally.

At launch, the product was primarily offered in 135g cans, and fiscal 1988 sales amounted to only approximately 18 million yen. In 1989, the company switched to 190g cans and made a full-scale entry into the beverage market. Sales channels were also expanded to kiosks and convenience stores, and through mass advertising investment and television commercials, brand awareness was rapidly elevated, with sales reaching approximately 8 billion yen in 1990.

Acerola Drink became a product that delivered the Nichirei name directly to consumers in a domain distinct from frozen foods and logistics. Combining the functional value of abundant vitamin C with the topicality of a rare ingredient, it was positioned as a product symbolizing New Nichirei.

On the other hand, the beverage market was also an area with low barriers to competitive entry, easily exposed to competition from major beverage manufacturers. While the distinctiveness of acerola as an ingredient served as a differentiating factor, whether the beverage business as a whole would grow into an earnings pillar for Nichirei depended on subsequent business development.

Nichirei had inherited cold storage warehouses and factory sites across the nation through the wartime control process at its founding in 1942. Even into the 1980s, the company still held numerous small-scale real estate properties including those in urban centers, but as surrounding areas urbanized, constraints in terms of logistics routes and expansion space had become evident. In central Tokyo in particular, the advance of residential and commercial development had brought the continued use of sites as cold storage warehouses into a phase where it lacked economic rationale.

Meanwhile, land prices were rising, particularly in the waterfront areas, and land that had been held on the books for warehouse use had come to hold potentially high real estate value. With the heavy equipment renewal burden of the cold storage warehousing business, the question of how to handle these increasingly underutilized properties emerged as a subject of management decision-making.

In December 1988, Nichirei decided to redevelop the former Akashicho factory site in Chuo-ku, Tokyo as an office building. Rather than selling the land that had completed its use as a cold storage warehouse, the company chose to continue holding it and earn rental income. Total construction costs were approximately 6.5 billion yen, with stable revenue expected from bulk leasing from the first year after completion.

This policy was not limited to the former Akashicho factory. In 1990, the former Kachidoki Bridge factory site was also approved for office redevelopment. The four target properties—the former Akashicho factory (approximately 4,200 sq.m), Kachidoki Bridge factory (approximately 4,600 sq.m), Tokyo factory (approximately 6,100 sq.m), and Minato Building (approximately 650 sq.m)—were all located in the Tokyo waterfront area. The decision was to incorporate real estate leasing as a revenue source complementing the cold storage warehousing business.

The office redevelopment of warehouse sites secured a revenue source for Nichirei distinct from its food and logistics businesses. Rather than one-time monetization through sale, the choice to continue holding properties and earn rental income was a strategy to recover asset value on a different time horizon from the business.

The structure in which dispersed locations acquired during the wartime control period came to hold value as urban center real estate assets more than 40 years later is instructive from the perspective of use conversion of equipment assets. Bases that had completed their role as cold storage warehouses came to serve the role of complementing Nichirei's financial base in the form of real estate income.

In the late 1980s, Nichirei's logistics business was reaching a turning point. Conventional cold storage warehouses were centered on storage-type operations that held large container-unit quantities for a fixed period before dispatch. However, with the expansion of frozen food distribution volumes and the increase in imported foods, the frequency of receiving and dispatching had risen, and storage-centered operations could no longer keep pace.

Changes in retail formats also had an impact. Supermarkets demanded multi-item small-lot, short-lead-time fulfillment, requiring logistics functions that encompassed sorting, trans-loading, and delivery beyond mere storage. Cold storage warehouses had entered a phase where processing capacity and turnover rate, not physical storage volume, were what mattered.

Against these demand changes, the extension of the warehousing business was showing its limits. The conventional mindset of measuring cold storage value by storage area was creating a structural gap with the service levels demanded by the retail side.

In 1989, Nichirei launched the 'Logistics Project' and began redefining cold chain logistics. The project was organized across the freezing business's affiliated companies, development departments, and trading departments, and two directions were presented as the new logistics vision. One was a customer-intimacy type that designed logistics according to each customer's requirements.

The other was the concept of 'systems logistics' that centered on movement and processing rather than storage. The idea emphasized transfer over storage, providing sorting, customs clearance, light processing, and delivery as an integrated service. This was a decision to reconceptualize logistics not as a cost but as a function that generates added value.

This redefinition involved departing from the equipment-dependent thinking inherent in the cold storage warehousing business, to reconfigure functions in line with demand-side changes. It was a decision to switch the evaluation axis from storage area to processing capacity, from volume to turnover rate.

In 1990, Nichirei renamed the bases it had been calling 'freezing plants' to 'Logistics Service Centers.' This was a symbolic name change signaling the transformation from storage bases to service delivery bases, both internally and externally. Simultaneously, the organization of Nippon Low Temperature Distribution was restructured, establishing a nationwide delivery system.

At the Logistics Service Centers, operations were introduced based on L-shaped platform berth consolidation and temporary truck staging. Combined with information management through online systems, inventory status and shipping instructions were made visible, enabling response to joint delivery and high-frequency small-lot delivery.

This led to the expansion of transactions with major retailers, and the cold storage warehousing business changed its character to a logistics services business. The renaming of bases was not merely a matter of nomenclature but an act of rewriting the very definition of the business.

In the early 1990s, the frozen food market was expanding, but the cooking burden at home was constraining wider adoption. While frozen croquettes were popular products, the common sentiment among homemakers that 'deep-frying is troublesome because of the oil disposal' meant that purchase frequency was stagnating. Microwave ovens were spreading rapidly, but due to moisture migration characteristics, breaded coatings tended to become soggy, and microwave ovens were considered unsuitable for reproducing the texture of fried foods.

Frozen croquettes remained in the market carrying the implicit premise of being 'a product meant to be deep-fried.' Overcoming the wall between deliciousness and convenience required a product design that fundamentally reconsidered the cooking method itself.

In 1994, Nichirei launched 'Sakusaku Croquettes (Mini),' designed exclusively for microwave cooking. The development starting point was an analysis of frozen croquette purchasing patterns and surveys of homemakers, with the goal set as 'reproducing the taste of freshly fried food without using oil.' Approximately 15 young employees participated in the development, with repeated investigations focused on breading structure and moisture control.

The greatest challenge was maintaining the crispy texture with microwave ovens' unique heating method. To address the problem of moisture migrating from the filling to the breading, technical innovations were introduced including multi-layered breading, formulation adjustments, and control of moisture behavior during heating. A product was realized that overturned the previous premise of 'not crispy unless deep-fried,' and it was launched as part of the 'New Microwave Life' series.

Sakusaku Croquettes were a product designed not from flavor improvement but from the cooking behavior itself as the starting point. Based on the premise of microwave oven prevalence as a change in the living environment, the product opened new use cases by removing the constraint that frozen foods were 'something to be deep-fried.'

This product demonstrated that competition in frozen foods extends beyond flavor and price to encompass the design of cooking methods and use occasions. The approach of directly reducing consumers' cooking burden served as a precursor to Nichirei's subsequent 'authentic quality' direction, broadening the perspective of product development.

By the mid-2000s, Japan's poultry industry harbored a critical structural risk. Approximately 99% of the grandparent stock and parent stock supporting broiler production was dependent on overseas imports, with an extremely high concentration on specific countries and regions. When the Japanese government imposed import suspension measures following avian influenza outbreaks around 2006, the supply of grandparent stock was significantly reduced. The supply disruption was recognized as not a one-time event but one with a high probability of recurrence.

For Nichirei Fresh as well, chicken was an important raw material, and procurement instability directly threatened business continuity. Mere diversification of procurement sources could not avoid infectious disease risk or policy risk, and the conviction strengthened that involvement from the raw material stage was necessary to simultaneously ensure safety and stable supply.

In May 2007, Nichirei Fresh established 'Nichirei Fresh Farm' as a joint venture with Ishii, and constructed the Hirono Farm in Hirono-cho, Kunohe-gun, Iwate Prefecture. Grandparent stock bred and improved at the National Livestock Breeding Center's Hyogo Ranch was introduced and raised and marketed as the pure domestic breed 'Junwakei.' The company stepped into directly managed poultry farming, managing the entire process from grandparent stock through hatching and rearing.

This initiative extended beyond procurement internalization to aim at ensuring full-process traceability. The strategy was to make production history visible and promote safety and quality as brand value. In 2012, 'Fresh Chicken Karumai' was established to handle processing, further processing, and sales, building a system that completed the chain from production through processing within the corporate group.

With the commencement of directly managed poultry farming, Nichirei Fresh established a pure domestic chicken production system capable of approximately 1.5 to 1.6 million birds in annual shipments. The procurement model that did not depend on imported grandparent stock from overseas functioned as a structural countermeasure against supply disruption risks from avian influenza and similar events.

The decision by a food manufacturer to go upstream to the raw material level and directly manage operations was a choice to internalize not just procurement cost optimization but supply stability and quality traceability as management resources.

By the late 2000s, Nichirei had been advancing the sophistication of its cold chain logistics business domestically. Through scrap-and-build of large cold storage warehouses, conversion to logistics service centers, and expansion of joint delivery, a cold chain logistics model integrating storage and transportation was being established. Domestically, the base network had been developed primarily in major metropolitan areas, and growth potential was gradually becoming limited.

Meanwhile, in Europe, the distribution volumes of frozen foods, meat products, and seafood were large, and demand for cross-border cold chain logistics was structurally high. While Nichirei had already been conducting European operations with the Netherlands as its base, France was an important market on both the production and consumption fronts but lacked a direct business foundation.

In July 2010, Nichirei Holding Holland B.V., a European subsidiary of the Nichirei Logistics Group, acquired four French cold chain logistics companies. The core was Transports Godfroy S.A.S., which had a delivery network covering all of France, and by combining it with three cold storage warehouse companies, a system capable of providing integrated storage and transportation was constructed.

The acquisition amount was 15 million euros for share acquisition and approximately 24 million euros total including real estate acquisition. The target companies were all based in northern France, with locations linking major ports such as Le Havre with inland areas. Rather than building bases from scratch, the choice was made to incorporate existing transportation and warehousing functions as an integrated package, establishing a cold chain logistics network in a short timeframe.

The acquisition of four companies enabled Nichirei to establish a business foundation with a view not only to the French domestic market but also to cold chain logistics deployment across western Europe. It was an attempt to apply the integrated storage and transportation operations know-how refined domestically to the different market environment of Europe.

The investment scale of approximately 24 million euros total was restrained even compared to the construction cost of a single large domestic cold storage warehouse, representing a decision to build a foothold for overseas deployment while limiting risk through the acquisition of existing operators.

By the late 2000s, Nichirei's frozen food business had established a certain position in terms of market size and production volume, but profitability growth was limited due to price competition and promotional discounting dependence. Frozen foods had high shelf life, which made turnover rates slow, and at retail sites, they were structurally prone to being targeted for discount adjustments. Even when hit products were introduced, securing medium-to-long-term profitability remained challenging.

Meanwhile, on the consumer side, the increase in dual-income households and diversification of lifestyles were driving growing demand for 'convenient food without compromising quality.' Nichirei's research clearly showed that products with insufficient taste satisfaction were less likely to generate repeat purchases. The need to redefine value around quality rather than pursuing volume expansion was emerging.

In 2014, Nichirei simultaneously advanced the reorganization of its production system and quality-oriented product development to rebuild the competitiveness of household frozen foods. While progressing mechanization and labor-saving on frozen food factory lines through new construction and reorganization, the company made clear its policy of foregrounding 'authentic quality' through enhanced commitment to cooking processes.

The emblematic product was 'Honkaku Yaki Onigiri.' Product design emphasized enhancing the handmade feel and reproducibility of the grilling process, providing flavors and aromas that are difficult to recreate at home in frozen food format. Furthermore, in fried rice, proprietary processes combining coating technology and high-temperature short-duration cooking were introduced, and the product was relaunched as 'Honkaku Itame Chahan.' These were product lines that placed taste itself, not convenience, at the center of value.

The product lines foregrounding authentic quality aimed to provide consumers with purchase motivations independent of promotional discounting. To form the brand preference of 'I buy it because it's Nichirei frozen food,' product designs where the taste standard itself served as the criterion for repeat purchase were necessary.

This policy shift signified the transition from the volume expansion direction pursued since the 1980s to a quality-oriented axis. The approach responded to the challenge identified by then-President Teshima—'the lack of effort to communicate what kind of company we are'—by answering through the quality of the products themselves.