Medium Term Management Strategy
Briefing Document
NICHII GAKKAN COMPANY
June 3, 2015

Erect four pillars for business in Japan
Expand the global business© 2015 Nichii Gakkan Company. All rights reserved.

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Constructing a Long-Term Stable Revenue Structure:
Moving from two mainstay businesses to four
Domestic Business
Medical SupportBusiness[First pillar]
Long-Term Care and HealthCare Business[Second pillar]

EducationBusinessChildcareBusiness

PointsFuture Strategies- Holding the top market share- Firm profitability- Continuity of contracts- Focus on profit- Increase in extra value- Holding the largest market sharein the growth sector- Income figure- Human resource development- Improvement in productivity- Further opportunities for growth- Human resource developmentin the operating sections- Global human resource
development program (language skills)- Aim to be a leader in language education business- Towards global business expansion[Develop into a third pillar]- Positive expansion in preparation
for the launch of a new system(authorized / in-company childcare
centers)- Aim to be a leader in the industry- Support for the childcare of staff working in
the medical support and long-term carebusinesses[Develop into a fourth pillar]- Emergence of a working population shortage as the population shrinks
Changes inbusiness conditions in Japan - Perceived as a paradigm shift by the service industry which relies on human resources- Move towards a globalization strategy

2© 2015 Nichii Gakkan Company. All rights reserved.

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Globalization Strategy© 2015 Nichii Gakkan Company. All rights reserved.

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Globalization Strategy

To the 1st Stage for Globalization
1st. Stage・Developing business in China witha long-term care model as the core
Constructing business model(Five-Year Plan)
Establishing business foundations・
Steady growthdeveloping business in the2 nd. Stage Further
Asia-Pacific region© 2015 Nichii Gakkan Company. All rights reserved.

4Review on the China Business
Market Research & Selection ofBusiness Partners

2012:
NICHII CARENET CHINA Co., Ltd. established* Currently, Nichii Shanghai Co. Ltd.

2013:
Relationship established with the Chinese government
Nichii China Co., Ltd. established2014-:
Strategic partnership with the China Planning Instituteon Aging, which is directly run by the Chinesegovernment
Reorganization of a local home service operator intoa group company
Nichii Hong Kong Limited establishedNichii (Guangzhou) Co., Ltd. established
Instructor training started on a trial basis in the humanresource cultivation business

Circumstances Surrounding Long-Term Carein China▶ No long-term care insurance system exists.

▶ Under the circumstances represented by the phraseof Weifu Xianlao, which refers to getting old before
getting rich in an unequal society, it is difficult totake a uniform business response.

▶ The existing long-term care services are a mereextension of home services, and fail to satisfy
needs.

▶ Implementation of measures to step up home carein the 90-7-3 approach-> Beijing City Government announced the creationof 208 home care centers in urban areas on April 4,2015.

© 2015 Nichii Gakkan Company. All rights reserved.

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List of Companies Set to Join the Group (as of June 3, 2015)
Name of company
1

北京三傑聖一人力資源有限公司

2

重慶凱爾老年公寓管理有限公司

3

江門市中家家政服務有限公司

4

Name of school1

重慶市渝北区世達培訓学校

2

深圳中家職業技能培訓学校

深圳市中家家庭服務有限公司

3

江門市中家職業培訓学校

5

瀋陽助尓家政服務有限公司

4

梅州市華傭職業培訓学校

6

梅州市客家大嫂家政服務有限公司

5

無憂草東光職業培訓学校

7

済南仁徳家庭服務有限公司

8

広州市正祥和家政服務有限公司

9

北京無憂草科技発展有限公司

10

常州金蓓蕾健康諮詢服務有限公司

11

杭州天使家政服務有限公司

Heilongjiang
HarbinXinjiang-Uygur
Autonomous Region

Ninxia HuiAutonomousRegion

Gansu

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南寧康之橋護理服務有限公司

13

武漢尓邦家政有限公司

14

安徽賽菲家庭服務管理有限公司

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Company K in 大連市

16Company H in 哈尓濱市

17Company K in 天津市

18Company N in 青島市

19Company C in 鄭州市

20Company CN in 上海市

21Company K in 西安市

22Company M in 成都市

23

Company T in 長沙市

24Company K in 海口市

Inner Mongolia
Changchun
Autonomous Region
Jilin
Shenyang

Shanxi

Qinghai
Tibet
AutonomousRegion

Continuationconsideration item

SichuanXian・Shaanxi

Beijing
Tianjin
Hebei

Liaoning
Dalian・ Shandong
Jinan

Zhengzhou Jiangsu
・Henan Anhui Changzhou

Shanghai
Hubei
Hefei
ChengduHangzhouWuhan
・Jiangxi
Chongqing
Zhejiang
・ChangshaNanchang
Fujian・
Hunan
GuizhouFuzhouKunming
Guangxi Guangdong・
Yunnanprovince・ Hong Kong
Guangzhou
Nanning

Areas to be covered by the sales activities
of group companies

Areas to be covered by sales activities ofcompanies expected to be made into groupcompanies

Hainan© 2015 Nichii Gakkan Company. All rights reserved.

6Nichii’s Missions▶Create a new long-term care market and achievesound market development in China.
▶Provide services that respond to needs, cultivate staff,

and create jobs.
Key Concepts of China Business Expansion
Home Care Display core competence as Nichii’s strength to the fullest degree.
Implement the business concept of three excellent qualities andHigh Quality narrow down the target groups.
Localization

Scale

Introduce regional characteristics into services to encourageregional operating companies to become leaders in theirrespective regions.
Form a large-scale corporate group through partnerships withoperating companies in major regions across the country.
© 2015 Nichii Gakkan Company. All rights reserved.

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Market Strategy

Create a new long-term care market

General approach

Approachthrough
地方行政local administration
ルート

Approach through the世業活用
地方行政
use of existing
ルート
ルート
businesses

Onlineadvertising, etc.

Community daycare model

Hereditary familybusiness model(Home care, postnatal care, etc.)© 2015 Nichii Gakkan Company. All rights reserved.

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Standardization of the Nichii Method:
Establishing Nichii as a global brandFrom education to work
Nichii’s expertise in education is used to develop high quality human resourcesand elevate customer satisfaction.
Nichii’s human resource development scheme
Specialists
Cultivate
instructors

Cultivate
staff

EmployOfferservices

Management
executives

Staffmembers
Proactive appointment of local staff members as
executives

The Nichii brand
The brand name has been changed from Zhihu to Nichii.
Stressing that the brand originates in Japan, efforts will be made to transform
it into a premium brand.
The new brand logo:© 2015 Nichii Gakkan Company. All rights reserved.

9Localization and Upsizing Strategy
Regional operating company

Candidates
for staff members
Vocational training
schoolTrain

FY2016

EmployFY2017

飛躍的発展期
BranchConstruction offoundations for the long介護事業基盤の構築準備
term care business
FY2018FY2019FY20205 Branches+5Branches

Branches

FY2021 and later2 nd Phase

1st Phase+5

Full operation of thelong-term carebusiness+5Branches+5Branches

Schematic of branch expansion of a single operating company in different periods

× 20 to 25companies© 2015 Nichii Gakkan Company. All rights reserved.

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The Chinese Markets Targeted by the Nichii Group

Market Size:

5.13

trillion yen

Human resource
development
Aging and longterm careHousekeeping
services

Postnatalcare

Child care

2.3

0.6

0.15

2.8

trillion yen

trillion yen

trillion yen

trillion yen

Venturing to cultivate growth markets in China• Sources: Estimates by Nichii Gakkan Company, based on information from 95081 Jiating Shenghuo, March 2013,
the Yano Research Institute: Chinese Senior Market Yearbook, and other sources.
© 2015 Nichii Gakkan Company. All rights reserved.

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The base plans and other information contained in thisaccompanying document are forward-looking statements basedon the information currently held by the Nichii Gakkan Group. Forthis reason, they may be affected by uncertain factors, such as
the economic environment, deregulation, and employmentconditions.
Please note that actual base plans and other information maydiffer from those stated in this accompanying document.

Contact information
Nichii Gakkan Company
IR Division, Public Relations Department
Corporate Planning Headquarters
Address: 2-9 Kanda Surugadai, Chiyoda-ku, Tokyo
Tel: 03-3291-5637 (IR Division)
E-mail: nichii-ir@nichiigakkan.co.jp© 2015 Nichii Gakkan Company. All rights reserved.

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