Record Profits at Japanese Manufacturers, Wholesalers – METI Survey

Japan’s Ministry of Economy, Trade and Industry (METI) has released results of its 2017 Basic Survey of Japanese Business Structure and Activities. The report surveyed 28,550 companies with the goal to shed light on how management strategies of Japanese enterprises and industrial structures evolve.

Sales and profit conditions

Sales per company decreased by 2.9 percent year-on-year to 3.04 billion yen ($216.12 million), marking a decrease for three consecutive years. Looking at the major sectors on a year-on-year basis, sales were 21.11 billion yen in the manufacturing sector, down 3.9 percent; 36.76 billion yen in the wholesale sector, down 1.7 percent; and 24.32 billion yen in the retail sector, down 0.5 percent.

At the same time, operating profit per company was 1.15 billion yen, up 1.5 percent year-on-year, marking an increase for five consecutive years. Looking at the major sectors, profit was 1.47 billion yen in the manufacturing sector, up 2.4 percent; 950 million yen in the wholesale sector, up 17.7 percent; and 730 million yen in the retail sector, down 3.7 percent.

The operating profit ratio per company reached record highs in the manufacturing and wholesale sectors since the survey began in fiscal 1991. Overall, it stood at 5.0 percent, up by 0.2 percentage points compared to the previous year; 7.0 percent for manufacturing companies, up by 0.5 percentage points, and 2.6 percent for wholesale companies, up 0.5 percent.

Employment conditions

The average number of long-term contract employees per company on a year-on-year basis was 499, down 0.8 percent. At the same time, the number of permanent full-time employees stood at 319, up by 0.6 percent – marking a new record value since the fiscal 2006 survey, in which comparable data exists.

Ownership of subsidiaries

The ratios of manufacturing companies with ownership of subsidiaries on a year-on-year basis were 35.9 percent for domestic subsidiaries, up 0.2 percentage points; and 27.7 percent for overseas subsidiares, down by 0.1 percentage points.

The average number of overseas subsidiaries per company for manufacturing companies was 8.2, marking a new record value since the survey began in fiscal 2003.