KAGA ELECTRONICS CO.,LTD.

In the fiscal year ended March 31, 2023, we were able to achieve increases in both sales and profit thanks to substantial growth in operating results of the electronic parts business and the EMS business. These achievements can be attributable to the success of our efforts to stably meet customer requests, despite the global shortage of semiconductor and electronic parts. On the other hand, operating results for the fiscal year ending March 31, 2024 are expected to harshen, reflecting the absence of spot sales. However, we are confident that we will return to a growth track in the fiscal year ending March 2025. Accordingly, we will continue to push ahead with efforts to achieve targets under the Medium-Term Management Plan 2024. Driving forces enabling the Kaga Electronics Group to grow
The Kaga Electronics Group has upheld a corporate philosophy, “Everything we do is for our customers.” Moreover, to embody this philosophy, we put into practice action guidelines called “F. Y. T,” which consist of FLEXIBILITY (flexibility to align with changes in the market), YOUNG (a young mindset and an ability to act) and TRY (try courageously). The diligent implementation of these guidelines has enabled us to build an extensive track record and successfully led us toward the celebration of the 55th anniversary of our founding in September 2022.
In addition, our founding spirit, along with insights accumulated by successive employees, gave shape to KAGA-ism, which has been passed down to the present generation and taken root throughout our workforce.
Furthermore, the mindset of “Never say ‘no’ to customer requests” has been a unique stance cherished by KAGA ELECTRONICS since its founding, which is why we have long been appreciated by a large number of customers. Having started out with the delivery of electronic parts, we subsequently received requests to handle the “kitting” of multiple parts. This, in turn, led to orders requesting parts development and manufacturing. Our EMS business has emerged from the success of these endeavors and grown into an earnings staple.
On the back of global semiconductor shortages, a particular customer was struggling with its production line operations due to a slight shortfall of its semiconductor inventories. When we were asked to assist, we quickly moved to procure the necessary parts, but found their unit prices to be much higher than expected. We therefore proposed selling them only the essential number of parts. However, this particular customer requested we deliver all of the parts we managed to secure. We were able to make a customer happy through this successful transaction while also garnering even more favorable reviews. We take great pride in our track record of such endeavors, as we have successfully fulfilled 90% of our customers’ requests.
Another unique stance taken by KAGA ELECTRONICS is “Never say ‘no’” to employee suggestions. For example, we allow ambitious employees to handle the entire process of launching new businesses on their own. This is, of course, no easy task as it entails the inauguration of a new company, staffing, and even fundraising. It brings us great joy, however, to witness the personal growth they attain through overcoming such challenges.
Of course, regulations regarding the withdrawal from business ventures have also been put into place. The “3-5 rule,” as it’s known, lays out our expectations for a new business venture to achieve profitability in terms of single-year operating results in three years and to eliminate all cumulative losses in five years. This is an objective that must be met. While it stands to reason that no employee is immune to failure, support for the underdog is part of the KAGA ELECTRONICS spirit. Using failure as a learning tool and achieving personal growth would be a wonderful thing, indeed. The Company would not have grown and thrived into what it has today if it took a zero-tolerance stance against failure. That being said, our employees thus far mark a high ratio of success in new business endeavors, with 60% to 70% of these pursuits having proven to be profitable. Happiness of all employees enables the Company to prosper
For KAGA-ism to be resolutely put into practice, the health of all employees is paramount. Since 2021, the Social Issue Working Group of the SDGs Committee has promoted initiatives focused on developing an employee-friendly environment and improving a work-life balance.
Based on the conviction of “a company never thriving unless its employees are healthy,” we place great priority on employee health and have therefore implemented a variety of initiatives. In recognition of these efforts, we were selected as an outstanding organization under the 2023 Certified Health & Productivity Management Organization Recognition Program.
As part of specific measures to create the employee-friendly office environment of the future, we set up a training room equipped with cutting-edge, AI-powered training machines in the Head Office. Produced by EGYM, these machines are capable of proposing optimal training routines to users based on individual physical characteristics via the use of electronic tags. Head Office employees who choose to commute now ranges from 40% to 60%, as we have maintained our remote working system, even in the aftermath of the COVID19 pandemic. This freed up enough of a vacancy in office space with which the training room could be established.
The Kaga Electronics Group aims to become “the Japanese industry’s No.1 corporate group” and “a competitive worldclass company.” The realization of these goals, in my opinion, ultimately hinges on our efforts to nurture human resources and help individual employees stay healthy, both physically and emotionally.