Business Model Based on
Customer First Principle

Creating Value Based on “Always Putting the Customer First”

ITO EN aims to improve its corporate value continuously in the long term, with a view to becoming a sustainable company. In the utilization of its management capital thus far, ITOEN has refined its strengths and generated various types of innovation. Looking ahead, it will continue working to create value towards the achievement of its medium- to long-term goals through further enhancement of its corporate governance and collaboration with its stakeholders.

Value Perspective

Group management principle “Always Putting the Customer First”

The word “customer” refers to consumers, shareholders, retailers, supplie rs, financial institutions and local communities.

Business Model

Inputs

Sources of competitive advantage

ITO EN is improving and enhancing its competitive advantage through various types of management capital, in order to make maximum effective use of its business model.

  • Financial capital

    • Financial management integrated with business model
    ROE (FY4/2018)
    9.0%
  • Manufacturing capital

    • Fabless management in cooperation with manufacturing subcontractors
    • Sales bases nationwide
    Number of sales bases (Japan)
    198
  • Intellectual capital

    • Brand strength
    • Cultivation of optimum raw materials according to diverse products
    • Mechanism for internal feedback of market information (Voice System for internal proposals)
    Number of internal proposals
    14,421
  • Human capital

    • Route sales
    • Professional team of Tea Tasters
    • Penetration of awareness of “Always Putting the Customer First” and “Still Now”
    Number of sales personnel
    Approx.3,500
    Number of Tea Taster certificate holders
    2,160(as of May 2018)
  • Social and relationship capital

    • Raw material procurement capability with scale advantage
    • Collaboration and network with related parties
    Percentage of crude tea in Japan handled by ITO EN
    Approx.25%
  • Natural capital

    • Quality improvement of tea leaves and stable procurement of raw materials based on the Tea-Producing Region Development Project
    Production volume and plantation area in the Tea-Producing Region Development Project
    5,405tons・1,401ha

Value Chain for Building a Competitive Advantage

ITO EN establishes CS V-type business operations based on unique innovations, social value and business value.

Value Chain for Building a Competitive Advantage image
  • Stable revenues structure, competitive advantage and unique business
  • Operations based on CSR, CSV & ESG management initiatives and the ISO26000 standard
  • KPIs / materialities identified and set in collaboration with stakeholders

Strategies for Achieving Sustainable Growth

Medium- to Long-Term Management Plan

ITO EN is implementing a long-term, integrated, ESG-based management plan, in order to achieve sustainability and growth potential.

Long-term vision

Become a good, global company that spreads Japanese dietary culture and technology to the world

Strategies

  1. Towards a “Global Tea Company”
  2. Second Core Business and Strengthening Revenue Base
  3. Strengthening Management Base: Financial Strategy
  4. Strengthening Management Base: CSV Management Initiatives

Targets for FY4/2022

  • Consolidated net sales 600billion yen
  • ROE 10.0%or more
  • Total return ratio 40.0%or more
  • Ratio of overseas sales to total sales 10%

Sustainability

Environment Social Governance

Common international social issues (SDGs)

Achievements

Outcomes

Shared Value Products

ITO EN achieves its financial targets by creating shared value.

Value for ITO EN

  • Consolidated net sales 494.7billion yen
  • ROE 9.0%
  • Total return ratio 48.5%

Value for all customers

Environmental value
  • Promote environmental conservation activities
  • Sustainable use of resources
  • Environmental conservational agriculture
  • Promote environmentally friendly lifestyles
Social value
  • Provide health value to a wide range of customers
  • Provide beverages that cater to diverse needs
  • Provide tea culture knowledge to customers
  • Sustainable agriculture and creation of jobs
  • Stability of management for production outsourcing partners
  • Safety and peace of mind for consumers
  • Spread and pass on Japanese tradition and tea culture, and utilization in education

Foundation that underpins creation of value / governance

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