Licensing silicone from General Electric and replacing the fertilizer mix (1953)

Not counting the five years it did not sell

The silicone contracted for in 1953 did not reach profitability until around 1960, and demand did not truly take off for another decade after that. The weight of this decision lies in the fact that a company deriving 80% of its sales from fertilizer carried, for five years, what Kosaka Tokusaburo remembered as a state in which the product “could hardly be called merchandise.” Harder than the decision to buy the technology, in practice, was the management that kept going without counting the years it failed to sell.

That said, silicone alone did not reshape the business mix. In the term ended November 1963 the largest share, 43%, came from vinyl chloride and caustic soda, with silicon-related products at only 17%. Rather than silicone remaking the company, it is closer to the truth that the chlorine and methyl chloride streams silicone brought with it pulled in PVC and high-purity silicon one after another. It was not a single new business but a chain of feedstocks that turned a fertilizer maker into a chemical company.