On the other hand, increasing sales is a top priority. In addition to Chairman Okamoto and President Makito, sales specialists were hired and deployed.

When considering the company’s growth, there is no doubt that strong sales power is a major factor. The essence of sales power is the development of new projects through collaboration between sales, technology, and production. New projects require new technology, and often require capital investment. Without knowing for certain whether sales will actually take off or be sustained, the company must take risks and invest, or it will miss out on opportunities. Various subsidies from the Japanese government and local governments have also been utilized to reduce risk.

The company’s main products are precision metal parts, but they can differentiate themselves by producing particularly precise and difficult parts. Their customer industries include optics, hobby, and medical, but the end users are often B2C. For this reason, they need to release new products every year to stimulate customer purchasing desire. New functions, shapes, and specifications are required, which is both a business opportunity and a challenge for parts manufacturers. By responding to these demands, the amount of work they receive will expand every year.

As a result, the organization expanded dramatically from its small beginnings to eventually surpass the parent company in terms of personnel.

Support from B&Company

B&Company has supported OEVN for 10 years since it first entered the market. Since it was an advisory contract, the issues they handled were wide-ranging, but some of the early issues they handled included the following:

1. Organizing accounting operations

The business management operations that were outsourced to a local accounting firm in the early stages. The company handled the switchover carefully to gain the cooperation of the accounting firm, but the transition took time, and created missing documents.

2. Addressing accounting issues

The large amount of loans from Japan caused various management issues. Profits were subject to fluctuations due to exchange rate gains, and a repayment plan to the Japanese subsidiary was required. For this reason, borrowing was incorporated into capital. Inventory management was also difficult issue. There were many irrational tax accounting rules unique to Vietnam, which took time to resolve.

3. Responding to stricter environmental regulations

Environmental regulations were strengthened at the time, and we had to prepare the necessary documents and deal with the authorities.

4. Human resources support

Designing recruitment criteria and methods for executive personnel and supporting implementation such as interview participation, establishing wage and evaluation systems, resolving labor issues, etc.

Resolving management issues is important in order to focus on sales and production, but it also has other benefits. Correct management produces useful information, and using this information creates a virtuous cycle.

” It helps to have visibility into how much profit each customer is bringing in, and how each investment contributes to cash flow and profits .”

President Makito looks back on the time.

Utilizing corporate databases

There are many things that parts manufacturing companies cannot do in-house, and they need many partner companies. This is especially true when new initiatives are required. Initially, OEVN relied on public directories and chance encounters to find these companies. Currently, OEVN uses the company database of B&Company.

B& Company’s E-DB began operation in 2018, and data for the eight years from 2016 to 2023 is currently available (for more information, click here ). 900,000 companies, including Japanese companies, are divided into approximately 500 industries, making it possible to extract candidate companies.

We also succeeded in identifying potential partner companies and business partners that you could not have identified on your own. This was particularly useful when searching for partners in specific fields such as the plating industry.

Ripple effects on Japanese corporations and future prospects

The company’s growth in the area is also reflected in the numbers . Currently, the factory floor area has expanded to approximately 2,400 square meters . There are 75 machines and 89 employees , both of which are more than 10 times the original number . There have been periods of recession when sales and profits stagnated, but the company has been able to overcome these by continuing to take on new projects.

So what happened to Japanese corporations while Vietnam grew? With the Japanese economy stagnating, the idea of compensating for the shrinking Japanese market by expanding overseas may be the perspective of large corporations. In fact, the results are often different for small and medium-sized enterprises.

In the case of Okamoto, the organizational structure of the Japanese headquarters was strengthened around the time of entering Vietnam, and the number of employees at the Japanese subsidiary increased by 1.5 times compared to when it first entered the country, and sales also grew similarly.

Of particular note is the customer base that the company has acquired locally . Transactions with customers acquired in Vietnam have been realized in Japan as well, leading to increased sales for the Japanese subsidiary. The increase in activity based in Vietnam has created a synergistic effect in sales between Japan and Vietnam.

Meanwhile, the young staff newly hired from Vietnam brought with them an energetic and lively work ethic . As mentioned above, they breathed new life into the existing company culture and revitalized the overall atmosphere . This is an example of how entering Vietnam has been a major step in management, leading to improved productivity on the ground and revitalization of the entire business .

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