Refusing to discount under a soaring yen — the “pro’s way” (1978)

Compete on price, or hold the line on value

The heart of this decision was that Shimano met the headwind of a soaring yen not by discounting or passing on the cost, but by absorbing it through the value of its products and the trust of its own overseas distribution. Where most of Japan’s star exports — consumer electronics above all — went out into the world on price competitiveness, Shimano Industrial took the opposite road: it stood on goods “worth more than their price” and refused even its own customers’ demands for discounts. A self-reliant balance sheet — an equity ratio of 52.5% — was what let it step out of the price war without having to watch the banks’ faces. When a strong yen thins your margins, do you defend them with cheap volume or with the value of the product? The company chose the latter.

That choice became the company’s backbone. After Dura-Ace at the top of the road range, Shimano went on to hold the world standard in dedicated mountain-bike parts as well, growing into the “Shimano of the world,” with the bulk of its bicycle-component sales overseas. The fifth-generation president, Yozo Shimano, would later say that brand strength is no more than the result of proposing superb products. The 1978 way of absorbing a strong yen through added value showed early a principle the company still keeps: a brand can be built only on value, never on price.