When Yasuo Ikuta saw the light focused by his unique lens erupt in a streak of smoke on a paved road about a decade ago, he was stunned by its potential.

Haruo Ikuta shows how an aspheric lens is made.

"It struck me that it could sell well," said the 63-year-old lens craftsman. "I was quite sure that I had made a great product."

It was the moment he had been waiting for.

Ikuta had spent many years studying advanced mathematics to comprehend the theory of the aspheric lens, performing calculations day and night to determine a series of gradients for polishing the nonspherical surface.

His company, Ikuta Seimitsu Co., was suffering from falling sales. But his breakthrough would mark a turning point in the ailing firm and transform it from a maker of conventional lenses into a maker of unique products.

Today, the Ota Ward, Tokyo-based lens maker has about 10 employees and is one of a limited number of firms whose profitability is rising amid Japan's harsh business environment.

An aspheric lens (left) does not distort, unlike conventional lenses.

Its sales have tripled to about 60 million yen in the last several years, and the company is considering exporting the lenses to Korea, Taiwan and the United States.

Not surprisingly, only a handful of businesses like Ikuta's have successfully managed to stage a recovery and become recession-free.

Experts say that re-empowering small companies -- which comprise some 99 percent of domestic industry and form the backbone of the nation's export-driven economy -- is key to revamping Japan's international competitiveness. But statistics show that millions of small Japanese firms are still struggling.

More than 40 percent of Tokyo-based firms with one to three employees said their sales have declined more than 20 percent from three years ago, while a majority of those with nine or less employees are stuck in the red, according to the Tokyo Metropolitan Government.

Trapped in the tough environment, some 14 percent of small firms with less than 300 employees are considering shutting down their business, up 4.1 points from three years ago, the metropolitan government said.

Nobuaki Yamada, executive director and secretary general of the Ota Ward industrial promotion organization, said that the decade-long economic quagmire has created one of the most severe climates for small businesses in Japanese history.

"Who could survive the slowdown in the information technology sector?" Yamada asked. "Companies have been taking body blows ever since the (asset-inflated economic) bubble burst (in the early 1990s)."

Yamada should know. He has witnessed the steady decline of Ota Ward, which was once a thriving cluster of small metal machining shops.

Experts say one thing that separates winners like Ikuta Seimitsu from other less fortunate companies is an original technique or skill that no one else can easily copy.

"The only thing we small makers need is something shining (in our skill)," Ikuta said. "Whether we succeed depends on whether we find it."

In Ikuta's case, that something was the technology to make aspheric lenses.

While a spherical lens cannot focus light rays without leaving an aberration, an aspheric one -- usually forming a convex curve near the center and a concave curve close to the edge -- gathers all the light into one spot, producing distortion-free image magnification.

Although some makers have molded plastics to mass-produce small aspheric lenses for compact cameras, Ikuta Seimitsu is just about the only maker capable of grinding and polishing any material to mass-produce large aspheric lenses with high precision. Its quartz aspheric lens is heat-resistant and capable of gathering light into intensities powerful enough for use in laser-cutting and metal soldering for a wide variety of products.

For small firms, the possession of such a key, proprietary skill is a must for survival, said Takamichi Hara, a Tokyo Metropolitan Government official compiling the latest white paper on small and midsize enterprises in Tokyo.

Otherwise, he said, "They have to turn to mass-production to raise a profit, which in turn would force them to cut prices."

Such companies would eventually lose out to their counterparts in neighboring Asian countries where labor is much cheaper. They are also vulnerable to industrial trends, as the recent slowdown in the information technology sector has shown. The IT slump has wreaked havoc with makers of semiconductors, personal computers and other gadgets, as well as their parts makers.

But innovative technology alone cannot revive small and midsize companies, Hara said.

"Achieving and maintaining one's own technology is necessary in the first place. But it's even more important to find demand for their technology," he said. "A company can score a success only when its technology fits certain needs."

Toward that end, he said, corporate owners must continuously challenge themselves to develop their technical skills further and keep an ear to the ground at all times.

Ikuta's struggle to develop a viable aspheric lens technology arose from desperation.

"I was driven into a corner," Ikuta said. "Orders were declining, the price per product was falling, I started to suffer from a terrible stomach ulcer, and I had to pay college expenses for my three children."

His company used to produce conventional lenses, or those with spherical surfaces. By the mid-1980s, however, the market was saturated. And when the 1985 Plaza Accord sent the yen rocketing skyward, it dealt his company a critical blow and sent him on a search for something new.

As he groped for ideas, he found a brief explanation about an aspheric lens in an old book, an encounter that changed his life. Until that point, he had known nothing about the aspheric lens. But he was attracted by the seemingly ideal lens and began to study its surface gradients.

When Ikuta finally produced his first aspheric lens years later, he thought demand for the product would be infinite. In reality, however, it was only the beginning of the rocky road to success, he recalled.

Before receiving orders from big name companies, he had to invent a testing machine to prove and further improve the precision of his products. He also developed his own grinders and polishers, based on conventional machines for spherical lenses, to keep his costs to a minimum and offer competitive new products.

High-tech innovations, however, are not the only road to survival for small companies.

Another craftsman, Masayuki Okano, 68, shows that even a traditional, lower tech skill can attract major buyers from various sectors wherever demand exists.

Okano's technique, called "deep drawing," turned him into the maker of the world's first case for lithium ion batteries 16 years ago. His invention sent annual sales at his six-man factory in Tokyo's Sumida Ward, soaring to 600 million yen.

Okano said he does not give clients an estimate for his work because he has no rivals with whom to compare prices.

"No one can do what I'm doing. How can I estimate such work?" he said.

The birth of the battery, which is popularly used in mobile phones and laptop computers, was revolutionary and turned the case produced at Okano's factory into an indispensable component.

As early as three decades ago, deep drawing -- a technology used to draw a sheet of metal into a seamless shell in a specific shape -- was nothing special in his neighborhood, which is jammed with small machine shops. Many craftsmen like Okano used to draw aluminum sheets to create cases for cigarette lighters, lipstick, ball-point pens and other goods.

As time passed and plastic took over aluminum, many craftsmen in the area shut down their business.

But Okano did not. He tried to use deep drawing to shape rare metals such as stainless chromium, which is harder to press than aluminum but stronger.

Today, several well-known companies at home and abroad need his technique to produce containers for crucial products ranging from fuel cells and robot motors to car sensors and optical fibers. He once made parts for parabolic antennas used by the National Aeronautics and Space Administration of the United States. He is now developing a magnesium case for cellphones that prevents them from radiating electromagnetic waves and is about to enter the medical equipment business.

"Big companies are seeking such makers (with special skill). But there are only a handful, and orders heavily concentrate on them," said Akio Koide, an officer in charge of corporate support schemes at the metro government's Small Business Agency.

The central and local governments have been taking various measures to increase the number of successful small companies, helping them re-engineer their technology and dispatching technical experts to regional business support centers across the country.

But whatever support the government provides, the bottom line seems to be that individual business owners must opt for the right strategy and move forward with firm determination.

Okano's factory, for example, has been spending 80 percent of its sales on research and development to upgrade its technology while outsourcing old technology.

Asked how he survived when many others gave up, Okano said, "Not many people keep on trying to improve their technique, whereas my company keeps on evolving."