After facing bankruptcy less than five years ago, Sanmi Corp. has fought back to become the nation’s leading producer of oil purifiers for power plants and home appliance companies, according to its president, Hisayoshi Tamaru.
Sanmi’s oil purifiers are used to remove gases and moisture from oil used for transformers at power companies. The firm, based in Ota Ward, Tokyo, was established in 1950 by Tamaru’s father.
Sanmi supplies more than 60 percent of the nation’s oil purifier market. It sells its products to all the nation’s major electric power companies, including Chubu Electric Power Co., Kansai Electric Power Co. and Tokyo Electric Power Co.
It also produces oil storage tanks, oil filters, oil purifiers for home appliance companies and refrigerant charging machines for refrigerators and coil winding machines.
Sanmi posted sales of 1.35 billion yen in fiscal 2002, up about 50 million yen from the previous year. It expects sales of more than 1.5 billion yen for fiscal 2003.
But the going has been hard during the more than decade-long economic slump.
Almost five years ago, Sanmi’s main bank called Tamaru to say it would not loan him 300 million yen as it had promised.
Tamaru took the call on Feb. 11, 1998. He was supposed to receive the cash the following day, in time to settle the payment on real estate Sanmi had purchased for its new headquarters in an auction held by a district court.
He persuaded the district court to postpone the settlement for two weeks and used the time to find other financial companies from which he could borrow the cash.
The so-called credit squeeze by major banks has resulted in the bankruptcies of numerous companies, big and small, in the past several years as the nation works to clean up its financial system.
“We faced bankruptcy due to the bank’s sudden breaking of its promise,” Tamaru said.
Sanmi has since changed its primary bank. “Major banks started last year offering unsecured loans, so the time has changed since our financial crisis,” he said.
Last year, Sanmi started borrowing money from the Tokyo Metropolitan Government and other public organizations to fund its business expansion projects, including forays overseas.
Sanmi began displaying its wares at trade fairs in China in 1993. Since then it has been developing a presence in the Chinese market by signing contracts with Haier, a major home appliance manufacturing group in China, and other Chinese companies.
The bulk of Sanmi’s income now comes from overseas sales, which account for about 70 percent of the company’s total income, Tamaru said. The company exports its products to China and other parts of Asia, he said.
A construction boom in China and other parts of Asia has created greater demand for oil purifier systems. Sanmi therefore receives a greater quantity of overseas orders for such systems, which range in price from 50 million yen to 100 million yen, than it does for replacing older units in Japan, a job worth a maximum of 10 million yen to the company, he said.
“Major Japanese home appliance manufacturers have also ordered our products for their overseas plants,” he said.
Sanmi employs workers from other parts of Asia, particularly from China. In 1993, it hired its first Chinese employee, who became a Japanese citizen and changed her name to Yoko Takamoto. Of the company’s 78 workers, four are from China, one is from South Korea and one is from Malaysia.
“We employ foreign workers willing to study the necessary skills for our business,” Tamaru said. “They are working hard to expand our overseas business, which has resulted in motivating Japanese workers.”
Takamoto has been developing new sales networks in China, and manages Japanese and foreign workers as head of the overseas sales department, he said. Sanmi is also looking for foreign workers who can speak English, he added.
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