Special Topics • Partnership Between Africa & Japan • 7

TInterview with Masaki Nishioka, Chairman, & Hiroyuki Gonda, President, of Hiroki Co., Ltd.

ransferring Japanese
Craftsmanship to Ethiopia – Hiroki
Leather Fashion Company

By Japan SPOTLIGHT
A fashionable store in Yokohama city sells a variety of chic fur and leather goods, such as belts, purses
and jackets. Trying out the jackets might make you feel as if you were a hero or heroine in a TV drama, as
they often appear in such attire. The shop itself reminds one of scenes from such programs often set inseaside towns. But most of its stylish leather items are actually made out of Ethiopian sheepskin.
In Yokohama, the venue for TICAD VII at the end of August 2019, we found a company working in close
collaboration with Ethiopia. Hiroki Co., Ltd., with its stylish sales outlet, has a history of working with
Ethiopia as a manufacturer of leather products using Ethiopian sheepskin. Chairman Masaki Nishioka told
us in the following interview about his encounter with Ethiopian sheepskin and the story of his business
partnership with Ethiopia, with some supplementary remarks by President Hiroyuki Gonda.
(Interviewed on July 19, 2019)

Self-Introduction
JS: First, could you

please introduce yourbusiness andyourself, Mr.
Nishioka?

Nishioka: Our company
was founded in 1952 as aWestern clothing shop by
my mother in the townshipof Yasuura in Yokosuka city.
In 1960, my elder brother
Masaki Nishioka
Hiroki turned it into Hiroki
Co., Ltd. and transferred theshop to Isezakicho in another part of Yokohama. At that time I wasworking as an apprentice for a wholesale shop in Tokyo, but I moved
to our shop. There were so many Western clothing shops aroundthere and all were enjoying profits. In 1964, against this backgroundof good business, we opened a new tiny 16 square-meter shop
specializing in leather and fur and crocodile skin, close to our
original Western clothing shop. It was the year when the Tokyo
Olympics were being held in the midst of high economic growth. Ourleather goods shop soon became very popular, as we were sourcing
our fashionable goods from such places as Spain, Italy or
Afghanistan.

History of Hiroki Co., Ltd.
JS: What made you go abroad to look for stock?
50 Japan SPOTLIGHT • September / October 2019

Nishioka: My younger
brother studied abroad in
India and after graduatingfrom a school there hetravelled in Europe by rail.
He also went to Afghanistan
and from there sent me bypackage an “Afghan Vest”
such as had been madepopular by The Beatles.
These items turned out tobe popular and sold very
well, as they were loved by
the young Japanese thenHiroyuki Gonda
absorbed in the hippie
culture. So that’s why westarted to look abroad for our stock. In the 1970s, economic growthincreased the demand for leather and fur goods and to meet thisdemand our company opened shops in Tokyo in places like Ginza,
Shinjuku and Harajuku, as well as in Motomachi in Yokohama,
Nagano and Nagoya. Our shop in Ginza triggered our continuous
sales expansion with the fashion for fur in the 1970s. But in the
1980s our long-running fur boom suddenly came to an end with theintense competition among fur product shops, as well as the anti-fur
campaigns by animal rights groups. In particular, the campaign led
by the French actress Brigitte Bardot attracted growing attention andsympathy and thus the fur business in the United States, Europe andJapan was seriously damaged and eventually collapsed.
JS: How did you overcome this crisis?

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Special Topics 7

Nishioka: When we saw signs of the decline of fur goods, having
assumed what would happen at the next stage, we changed ourbusiness to one specializing in leather. We reduced the number ofshops and gave up our domestic factories for fur products andchanged our staple business from fur goods production to sales ofleather clothing goods that we sourced in Europe. At that time, inSouth Korea there were almost 200 wholesale shops for leather
goods, and by visiting them and having a look at their goods, we
could see the direction that fashion would take. The goods that webought from those South Korean wholesalers sold very well in Japan
as well, and for around a decade thereafter sales of those goods
were fine.
But early in the 1990s when the boom for Korean TV dramas,
films, music and other Korean cultural products started in Japan, aJapanese fashion magazine introduced one of those wholesale shops
in South Korea where you could buy items at the wholesale price.
This spread to other magazines immediately and many Japanese
went to South Korea to buy leather goods in these wholesale shops.
This made Korean companies believe that Japanese would be good
customers for them, and they started to set up their own shops insome big cities in Japan. With the emergence of such rivals, ourbusiness was again in difficulty. Such a hard experience made us
again strongly convinced of the need to produce our own original
products. Otherwise we would not be able to survive thecompetition. We came to believe that we must create superb goods
that nobody could imitate. So we started visiting exhibitions abroad
to search for leather materials that we could use for our own original
brand.
We have had many challenges in developing our own original
goods. For example, we occasionally find a wonderful leather
material in an exhibition and order it, but in some cases the wrong
one is delivered to us. Even after the delivery of high-quality leather
material, we sometimes cannot make our products in the factory as
we had assumed in advance. Leather becomes hard when wet andhard leather is easier to process, but we wanted to keep the originalsoft leather to make our brand distinct from others. Moreover, whenleather is stretched unnecessarily, its quality is damaged and thegoods cannot be sold at a high price. Such problems made us thinkthat we should produce our goods while managing the production
process by ourselves.

Encounter with Ethiopia
JS: Could you tell us how you found Ethiopian

sheepskin in searching for high-quality leather
materials?

Nishioka: Ethiopian sheep are small and their skin is fine, thin, softand robust. It has been known to be used for golfers’ gloves. It istruly considered to be of supreme quality. But it has not been
considered good for clothing, as it is thin and easily damaged by
insects. It is also very small and you would find it difficult to cut out
a big portion to make clothing.
When my nephew graduated from a school of designers in 1984
he started working on leather clothing independently. He and his wife
were working on design, sales and accounting in their shop andselling fairly elaborate clothing. We invited him to work for us as adesigner and let him solely work on making clothes in our shop. He
told us he would be able to make clothes using Ethiopian sheepskin,even though many factories said they could not. So at exhibitions forskin materials abroad, we begged a materials shop to sell us
Ethiopian sheepskin but in vain, as they told us it would not be goodfor clothing. Dozens of those shops refused to sell the skins for thesame reason. But having heard by coincidence that the firstinternational exhibition in Ethiopia for skin materials was being heldin 2008, we decided to go to Ethiopia. Since then we had been
visiting tanners in Ethiopia and asking them to refine their tanningand completing processes, and thus our own Hiroki brand of leather
goods was born. We could also make a production line for the skinin our own factory founded in China in 2006. Sewing leather clothing
was not as easy as was originally assumed by my nephew but
somehow he was successful in completing our original leather
clothing which was very well received by our clients in our shop.
JS: You have been in the business with Ethiopia for

more than 10 years. In your experience, have you had
any difficulty with Ethiopian business partners?

Nishioka: Yes. In Japan, generosity would be rewarded withgenerosity, but there it was occasionally not. Instead, we sometimes
felt we were betrayed. For example, when we purchase a product inEthiopia, we were once asked to pay 40% or 60 % of our totalpurchase as a down payment in the contract, an unexpectedly higher
percentage than usual, which is normally around 20%. The more we
pay as a down payment, the higher the risk to recover it would be
and then we would have to accept further requests. We have done
our best to meet these unexpected requests on their side but
sometimes found our down payment was not returned.
JS: Are there still great benefits in doing businesswith Ethiopia in spite of some challenges?

Nishioka: Yes. For us that was setting up an ideal manufacturing
process. In Japan, it was almost impossible to find a partner
Japan SPOTLIGHT • September / October 201951

Special Topics 7

company to collaborate with us closely. For example, tanners inJapan were not ready to accept our requests regarding the tanning
process, such as keeping the softness of the skin, etc. What is donein each step of production is rigidly fixed. But after entering intobusiness with Ethiopians, we could talk with our Ethiopian tanner
about our interest in the initial stage of production. This is how wedeveloped our ideal working process where we could do whatever
we want.
JS: What do you think was the key factor in achievingit?

Nishioka: It was direct consultation with Ethiopian producers of
sheepskin. Our requests about materials would never be realized
through wholesalers. For example, we would like tanners to extend
the skin vertically instead of horizontally. This request was accepted
only through a direct conversation with the Ethiopian tanners
working on the skin rather than talking with their top management.
Good communication with them enables us to achieve whatever wemay want.
JS: Do Ethiopian tanners or skin producers have goodcraftsmanship and are they eager to make highquality products regardless of the cost or their
expected earnings from it?

Nishioka: Yes. I think Ethiopian tanners share such craftsmanshipwith the Japanese ones.
JS: It is often said that the introduction of a small

handicraft industry would be more effective inpromoting economic development in Africa than a
big manufacturing industry with large facilities. Whatwould be your view on this in the light of yourworking experience in Ethiopia?

Nishioka: I think Ethiopia is keen on attracting large companies with
big factories. I like the Ethiopian climate. It is cool all year long, as it
is located on high land, even though it is close to the Equator. Thislocation on high land without port facilities could be a challenge for a
big company in building up a factory. In our case, what we needed asa facility was only a sewing machine and thus much more lightly
equipped than large companies. In this regard, it is much easier for
us to set up a production facility there than for a big company. Thereis also a large population in Ethiopia exceeding 100 million, so it was
not so difficult to find labor.

52 Japan SPOTLIGHT • September / October 2019

Gonda: We set up our factory in Ethiopia with a firm belief – that wewould produce the best leather products in the world from the handsof the Ethiopians by using Ethiopian sheepskin, the best material forleather goods and our own best technology in the world. I think
Ethiopia is a good place for business dealing with high value-added
goods to be produced with time and labor as well as based on
specific values rather than cheap products like folkcraft. There areother places for big factories enabling mass production andconsumption. The key to achieving a country’s economic
development is whether it can engage in manufacturing by taking
advantage of its own materials.

Human Resources Development in Ethiopia
JS: What do you think are the main issues in humanresources development in Ethiopia in the light ofyour business?

Nishioka: You cannot apply Japanese work ethics to the Ethiopians.
We find it a challenge to develop human resources. We have three
Japanese staff in Ethiopia now sent from Japan. They have to teachthe Ethiopian staff even how to use tape measures. Thus it takes along time for us to raise a full-fledged workman there. The mostserious challenge is that an employee may quit our company evenafter three years of on-the-job training just at the moment when they
are supposed to be able to start working in earnest.
Gonda: In our factory, it is made a rule that a single person is incharge of the whole process from beginning to end of producing one
item of clothing, with long labor and devotion to the job, without any
division of labor. In this process, sensibility as well as technique iscrucial. How to teach this sensibility? How can Japanese craftsman
teach and transfer “Japanese craftsmanship” to our Ethiopian staff?
That is the most difficult task for them in facing the culture andenvironment gap between Japanese and Ethiopians.
JS: Is this method adopted in Japan as well?
Nishioka: It was adopted by our factory in Beijing. The president of
the Chinese factory also holds the job of president of the Ethiopian
factory. In the case of textile materials, we can cut a pile of thosesimultaneously to get many pieces of the same pattern, but in thecase of skin you cannot do it, as you have to cut out a different
shape and size for the part of body, namely stomach, head, hips, etc.
The quality of the skin for each part also differs. So we cannot apply
a single method unanimously in handling the material. Therefore, weneed to teach them how carefully they have to treat the skin. This isSpecial Topics 7

the most difficult part of our human resources development.
JS: You can teach them your technique, but it must be

difficult to teach the spirit behind the technique.

Nishioka: Yes, that’s true. We would like to transfer the spirit ofJapanese craftsmanship to them, that is to say, a passion forcompleting detailed work with much care and affection. In both of
our factories abroad, China and Ethiopia, it was difficult to teach theworkers this spirit as they put high priority on efficiency.

Expectations of TICAD VII
JS: What do you expect from TICAD VII in Yokohama

in August?

Gonda: On behalf of a manufacturing industry, we hope that African
nations will create a good business environment to attract foreigncompanies including Japanese ones, taking advantage of thisoccasion. I think the participating African developing nations all
expect technology transfers from developed nations, but in order toachieve this it is important to implement laws for facilitating
business activity for foreign firms interested in doing business inAfrica. In Ethiopia, we have had many difficulties with laws. First, it
takes a long time for us to understand them and the fundamentals of
those laws are pretty much different from Japanese ones. There arealso a variety of legal documents and it takes a long time to look into
interpretations of them. A company’s officers responsible for legal
affairs would be annoyed at so much work for clarification of legal
documents. So I believe the quickest way to attract big foreigncompanies to Ethiopia would be to modify the laws for them tounderstand easily, such as by largely applying the same laws as indeveloped nations.

Japanese Contributions to Africa
JS: To promote economic development in Africa,

initially small businesses establish themselves in theeconomy there and gradually see their revenues riseas they achieve a sufficient number of consumers.
Then large companies enter and settle down in theeconomy, prompting it to develop further at highspeed. Would this be suitable growth path for Africa?

Gonda: No. I think in reality large companies come to Africa first in
many cases. With those big enterprises coming from abroad, jobs
are created and personal income rises and purchasing power rises aswell. Thus the market becomes bigger and then many small andmedium-sized companies follow. This is the standard case of
economic development in an African country. However, in thisprocess with rises in salary, labor costs increase and then thesecompanies would transfer their factories to another nation. What is
important then is what remains to Africa, or what has been readiedfor the next stage of economic development. In this light, the keyrole of Japan, I believe, is to transfer our business philosophy toAfrica as much as possible. This means not pursuing merits of scale
but pursuing high-level skills and high quality products.
Nishioka: A mass production factory would not provide you withhigh-level skills by which you could earn money your whole life long.
In our company, as you must work on the whole process by yourself,
you can master all the parts of the process of producing leather
goods.
JS: Japanese craftsmanship was highly appreciatedby Westerners visiting Japan in the 19th century. It
must be necessary to transfer this to Africa.

Nishioka: Yes, it is very important. We would like to establish aschool in Ethiopia where anybody can learn free of charge, in
addition to our on-the-job training in our factory. It would be usefulfor a company to recruit high-quality workers who have graduatedfrom our school.

Future Plans
JS: Lastly, could you tell us about your future plansfor your business?

Nishioka: Since the Great Hanshin Earthquake in 1995, we have been
thinking that Japan could be hit by another great earthquake anytime
and anywhere. So we believe our business expansion overseas is an
important growth strategy for us. China, for example, is a very
attractive market for us, as it has an extremely large population and a
growing market. We set up a factory in Beijing in 2006, having
thought about the Chinese market in the future. We continue to be
keen on having sales outlets abroad in the future.

Written with the cooperation of Naoko Sakai who is a freelance writer.

Japan SPOTLIGHT • September / October 201953