Are you using a Canon camera? Are you always filled with
pride because of the high definition picture clarity of your Sony TV? Does your
Citizen watch not only look really good but never lets you down as well. If so,
you should know that all these major electronic products are from companies
that have their origins in Japan.
The electronic industry of Japan sprung up long ago but it
was by the 1980’s that a relatively small number of industries dominated Japan’s
international trade and investment interaction with the rest of the globe.
Image courtesy: http://goo.gl/Mk1R5
In fact at a certain point of time the success of the Japanese
consumer electronics industry exceeded that of the United States.However, the
economic crisis of 2008 hit the Japanese electronics industry hard. Instead a
number of South Korean and Taiwanese companies have gained higher profits and
market share in the electronics sector.
This decline has been attributed to a number of factors
including high costs, the value of the yen, too many companies producing similar
kind of products which causes duplication in research and development
efforts and reducing economies of scale and pricing power. A recent legal
change prevents electronics companies from claiming certain tax credits they
heavily banked upon.
In order to hold onto their market shares and keep raking in
profits a number of Japanese countries like Hitachi, Casio, NEC, Fujitsu and
Toshiba have merged some of their operations. The tendency to stay in markets
where they cannot compete wastes huge amounts of capital.
And more unfortunate is the fact that instead of focusing on
what they do best, they bleed their strong differences which feeds their losers.
Also they have failed to change along with the changing times. If we take Japan’s
phone market into consideration we will see how it suffers from the ‘Galapagos effect’.
Image courtesy :http://goo.gl/ens3P
This means that they do not work to develop their technology
in accordance with what is happening across the globe but instead prefer that
it develop in isolation. This causes their innovations to do well domestically
but not be able to achieve success globally. Many Japanese electronics giants
also failed to cash in on the mobile boom and manufacture smartphones of their own.
This lack of initiative proved to be detrimental to the percentage of profits
they earned.
However, despite all the losses that the Japanese
electronics industry might be incurring their products are still incredibly reliable
and pocket friendly. Japanese electronics manufacturers are trying all sorts of
new strategies to get back into the market and reclaim their lost glory.
New initiatives and strategies are being implemented but
they will only prove to be successful after a certain amount of time has passed
and that too if great effort is taken. For now though the Japanese industry is
in a very uncertain state.
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