PIP: Bringing Japanese wellness to the world

Japan’s demography is declining and its population is aging, this is creating problems in the area of the workforce as well as the health and lifestyle of people. Caring for a society with an average age of fifty is different from a society with an average age of twenty or thirty. As a company that provides wellness and healthcare products, how is Japan’s aging population impacting your business?

We are fortunate that our products are having a positive effect in Japan's aging society. A lot of our products are for muscle or shoulder stiffness which actually cater to the elderly people. On the other hand we are losing a market share in baby products due to the decline in birth rates, we are reducing the number of baby products at the moment. Currently we are focusing on products that have a good market share and are in demand. Even though the birth rate is dropping it does not mean that our products are no longer necessary, Japanese people actually tend to spending more money, for the younger generations and this trend supports the demand for baby products

The coronavirus situation has brought a lot of changes in sports activities around the world, this has also impacted the sports equipment makers as we are experiencing lockdowns. On the other hand, we are seeing an acceleration in the use of digital technology. How has this pandemic impacted your business? How has your company adapted to this rise in e-commerce and digital shopping?

Our traditional ways of conducting our business have been apparently affected by this pandemic situation. The sales of some products have increased through e-commerce while some have declined significantly in stores. As you have mentioned there has been a decline in the total sales of sports products such as taping tapes due to the drop in sports activities, especially student sports. We supply most of the drugstores here in Japan and as a response to this pandemic we sell more on Amazon. To avoid meeting people, customers do not go to the drug stores that much anymore and instead they purchase the products online. This actually increases their buying tendency, meaning they go to the shops less frequently but they buy more quantities. The reduction in the number of people coming to Japan has affected our sales.   However, we are not really losing that much in terms of fiscal results. We are losing in some manufacturer business but we are catching up in wholesale business.

Your company was founded close to a century ago and you started as a wholesaler. Today you have a dual function, not only do you operate on your wholesaling model for your products available in shops but you also develop and manufacture some of your products in house. Could you please run us through your history and your milestones? What synergies have you been able to create as a manufacturer and as a wholesaler?

We began wholesaling as our major activity for the healthcare field until the late ‘60s. After that the perception of doing business here in Japan was changed, because a paper was published that wholesale business is no longer just a business that moves products like what it used to be, for that reason we started to come up with solutions to sustain our business by complementing our wholesaling business with manufacturing activities. We started as a manufacturing business

in 1968 and in 1972 we started selling our PIP Elekiban. For the first five years nobody knew our products and there was no good response in the market, but gradually we gained success. Now, everyone in Japan knows these products. In 1984, the company name was named PIP, and through the business integration in 2008, the business holding company "Pip Co., Ltd." was established. In 2010, we merged two sales companies, Pip Fujimoto Co., Ltd. and Pip Tokyo Co., Ltd. Now we are known as PIP Co., Ltd. The synergies created from combining these two companies include reeducation of the personnel in these companies and developing more understanding about the products we are selling. 

There is something interesting about your products - the PIP Elekiban that relieves stiffness in the neck and shoulders - which is a combination of healthcare and medical applications. Why do you believe it is important to add medical functions to these products? What do you believe are the contributing factors to the success of these products?

The idea behind our products is to make them different from the products of other companies that are doing a similar business, that is why we included medical functions to our products. Back in the ‘60s and ‘70s Japan was very curious about what applications can be done with magnets, then the products that we introduced with the use of magnetic flux were a success. Furthermore, people that used our products have experienced that their stiff shoulders have been relieved. The company has conducted clinical trials in hospitals for many years and the results have been successful. Currently, we are continuing research to prove that devices improve blood circulation and relieve muscle stiffness.

Your company founded a subsidiary in Taiwan and you export your products to Southeast Asian and Russian markets. Kindly run us through your international strategies and the key markets for your future growth.

The company is in fact not that fast when it comes to overseas activities, actually our subsidiary company in Taiwan was only established in 2013 and it was a result of a joint-venture. Partners in Taiwan already had a sales channel, which simplified our marketing strategy and helped promote our products. Actually our subsidiary in Taiwan is not a hub into the Southeast Asian region because our products can only be sold in Taiwan, of course we plan to penetrate the Southeast Asian market. We established a sales facility in China, although it is a bit challenging to really capture the Chinese market and we have not been very successful in this area, however we did not give up this market and we are thinking of ways to penetrate it. There are a number of things that need to be considered before we take a huge step in establishing a factory or sales offices in the regions nearby such as in Thailand or South Korea. We have to conduct further studies in these markets. Speaking of the western markets there are not many great results, at some point we tried the US market but there was not a favorable response. For these reasons we understand that we need to pull strings in order to understand how to capture this market. European markets are also on the table right now.

With the type of products that you make you are going to face a myriad of both local and international competitors in the Southeast Asian market. One of the particularities of this market is the ability of your competitors to manufacture products at a cheaper price. Despite this price competition, how do you plan to position your company?

When we talk about any market the strategic point is to come up with an understanding on the adaptiveness of our products to the foreign markets and capturing an audience. If we look at our history as a wholesaler and later on as a manufacturer, obviously roots have been placed here in Japan and that is why the people who know and rely on our products use them. The same way of thinking could be used to capture foreign markets although this could not be done over night. One effective strategy is to establish sales points that help disseminate the information that our products are the best-selling magnetic therapy devices in Japan and have gained trust.

What do you think are the reasons why when tourists come to Japan they want to buy your products and take them as they leave the country?

Historically the products have gained wide acceptance from countries such as China, Taiwan, and South Korea. When tourists from these countries come to Japan, obviously before this coronavirus situation, they tend to buy our products and give them as presents to their loved ones and friends back home. If a product is widely sold on daily occasions it gets more attention from the foreigners. Before coronavirus we were still selling our products in huge quantities. For example, some foreign companies buy our products and sell them in their respective countries.

Imagine we come back to interview you again in 2028 which will be your 120th anniversary, what would you like to tell us? What are your dreams for the company? There will come a time that you will retire and you will hand over the company to your son, when that happens what kind of legacy would you like to leave?

I would like for the next generation of executives to continue running the company with the same philosophy and activities that have been accumulated. In this company we have a culture of always challenging ourselves in everything that we do. I dream to see that our company will have gone to places that we were not able to do as of this moment, to always give satisfaction to our customers and show them friendliness, hospitality, and appropriate manners. I would like to have our employees play an active involvement in all mutual efforts that we do here. Lastly, to perpetuate an atmosphere full of happiness, warmth, and openness among our employees.