Mitsui & Co is Japan's oldest, most experienced trading house. Older than either the House of Rothschild or the Bank of England, it has played a leading role in Japan's industrial and commercial development since the latter half of the 17th century.
Beginning as a small, family operation, Mitsui prospered and expanded throughout Japan, eventually winning national recognition as a mercantile and banking house. After the Meiji Restoration in 1868, the mercantile company evolved into a trading company, and the banking function became the Mitsui Bank. With these two vehicles, Mitsui invested vigorously in other industries, such as mining and manufacture of a wide variety of products. Then the new trading company set out to provide its many services to businesses abroad.
Mitsui opened its first office outside Japan in Shanghai in 1877 and followed it one year later with offices in Paris and Hong Kong. Its New York office opened in 1879. By World War II, Mitsui had become the largest trading organization in Japan. After the war, the Mitsui family-owned industrial combine was dissolved into over 100 smaller companies, by order of occupation authorities. As Japan's industry recovered and international trade grew, the new Mitsui opened representative offices throughout the world. More recently, the company has accelerated its global business plan in the following ways:
- transferring control over foreign investments and extending loans (with certain limitations ) to overseas offices;
- transferring existing joint ventures to the accounts of incorporated subsidiaries overseas;
- establishing and strengthening the primary control system of joint ventures by incorporating subsidiaries overseas and speeding the autonomy of overseas offices through establishment of fund-raising bases; and
- backing up global business from domestic divisions and offices.
In 1979, consolidated net sales were approximately $43 billion.
Mitsui's fundamental goal today is to promote the expansion of free trade and provide an impetus for continued international economic development. Although the company's numerous functions are closely interrelated, they can be classified into two general types: ( 1 ) basic trading services and (2) services for commercial development. Basic services include four primary functions:
- Conduct of transactions. Mitsui offers a broad range of support services for companies interested in exporting to or importing from Japan or engaging in trade transactions among the company's worldwide network of offices.
- Arranging for the distribution systems, including insurance, for each transaction. In some cases, distribution can be arranged using Mitsui's own vessels and warehousing facilities around the world.
- Financing. To augment the financial resources of client firms, Mitsui provides extensive trade credit for companies in the domestic market. It also purchases equity, makes direct loans, guarantees client obligations and provides assistance in obtaining finance from other financial institutions. The company's services in this area center around encouraging the flow and development of trade and commercial activity and therefore extend beyond those provided by financial institutions. Leasing services are also available. However, unlike conglomerates and merchant bankers, Mitsui makes such financial arrangements mainly in connection with trading activities to stimulate trade flows and the market-not for handling funds per se.
- Information Through its network of domestic and overseas trade affiliates, the company is in a position to obtain basic information on virtually any market or business opportunity.
- Mitsui has been an active partner in joint ventures in Japan and elsewhere. The [company's] president, Toshikuni Yahire, ... stated: "We plan to continue to improve the position of our subsidiaries in Japan and overseas. The company's purchase and leasing of grain storage facilities in the US and other investments in this area are one example of the types of investments in key businesses that Mitsui will undertake."
- The company has invested extensively in resource development.
- To assist in industrial development at home and abroad, particularly in the developing nations, Mitsui is an active intermediary in the export and import of technology, combining this activity with assistance in transactions and finance for new industries set up through technology transfer.
- The company also plays the composite role of organizer, in which it draws upon its full range of services-from marketing to finance to technology transfer-to put together major industrial projects.
In sum, Mitsui cannot be categorized as a company in the traditional mold, divided between domestic and foreign operations. It is a true multinational enterprise.
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