Selling the supermarket and drugstore subsidiaries: leaving retail (2006)

What it means to close a business of forty-three years

The 1.6% operating margin had not moved since 2002, and the calls to withdraw on account of it had run just as long. Sano Minoru had turned them down at the time, saying that weighing long against short in operations and investment is the manager’s job. When the company let the same business go four years later, the reason it gave was not profitability but the concentration of resources on medical devices and pharmaceuticals. The reason for closing had not changed; the conditions under which it could be closed had come into place.

That said, this judgement can only be called correct because we know what came after — that medicine and pharmaceuticals did in fact grow. At the point of exit Nipro released ¥67.2bn, a third of consolidated sales, along with the people working in its stores across the Kyoto–Osaka–Kobe region; had it failed, the decision would have cost nothing but scale. A business begun in 1963 by asking whether the company could contribute freshness in produce, fish and meat was cut loose forty-three years later in the name of concentrating on medicine. The relay by which materials earned while retail was raised, and retail earned while medicine was raised, had here completed its final leg.