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Supplying fine chemicals for a diverse range of industries

Interview - August 12, 2021

Established in 1951, Parker Corporation has long been a reputed manufacturer and supplier of high-quality fine chemicals for several industries, including automotives, electronics, steel, aircraft and machinery. In this interview, president, Yoshishige Satomi, explains how the company is shifting its focus to developing fine-chemical based surface treatment solutions for the semiconductor industry as it looks to diversify its business. Mr. Satomi is confident that Parker can create market leading solutions in tune with the latest trends in the semiconductor manufacturing industry, such as miniaturization, film thinning and multi-layering.


In the last 25 years we have seen the rise of regional competitors such as China, South Korea, and Taiwan that have replicated the Japanese Monozukuri process at a cheaper cost, providing the world cheaper products with a lower quality. As a president of a company that produces high quality, highly reliable products, what is the role of monozukuri in your production process?

The principle that our competitors have adopted is cost performance, that is their priority but that simply doesn’t work here when we talk about our major activities. We have solid tie-ups with our business partners and long-lasting trustful relationships especially for the domestic market. That’s the fundamental business activity that we set up. Instead of just price competition, what matters to us is the value creation in our customers that is brought by such activity.

For example, one of our major business activities is to sell the machinery which makes and finishes the interior of cars. The roofing and armrest of cars are made by our machinery. Its mechanism is to wrap leather or cloth on the roofing or armrest of a car. In the past we imported shoe-making machines. The wrapping machine was born from the same concept of shoe-making machine but by adding our own know-how and idea, we  have made products which are different from our competitors‘.  This machine contributes to manpower reduction. The same high quality products can be made at low cost which leads to cost performance.


How do you find your business partners and what do you look for when you go abroad such that you are able to bring to Japan some innovations?

It is a lot easier these days to find potential partners through the internet. Also, we use the ‘word of mouth’ method from our existing customers to analyze and find out our potential partner’s advantage.

For companies that are looking to introduce their products, what makes you an ideal business partner to support them to enter the Japanese market?

The ideal partners could be the companies that are familiar with the method to sell their products which they want to sell and understand the market correctly.                             In the case of Parker Corporation, our main business is B to B. We have lots of experience in dealing with many industries and immense customer channels. Therefore, if the customer needs fit well, I think we can become an ideal partner.


If we look at the global chemical industry, we see that it is actually increasing, and it is expected to reach a value of nearly USD 500 trillion in the next 5 years.  The reason behind this is that we are seeing increased use in the automotive and aircraft industries. Could you tell us what solution that you can offer to your clients when it comes to the chemical business that you have?

Our chemical division is closely related to automotive manufacturers. If their global production volume increases, the more of our chemicals are needed and naturally the increase of our chemical sales is expected. Our chemical division also needs to adjust according to the changes of the needs that these automobile manufacturers are implementing in a medium- and long-term perspective. In addition to chemicals, we would like to adjust our sealant and sound insulation products by utilizing our advantage.


With the shift in the automotive industry, please tell us about any product that could support them or any product that defines the essence of your company?

Although many of our products do not have clear brand names, we have many energy saving environmentally-friendly products to meet the needs for lighter car weight and machines for manpower reduction.


There is something interesting in your company which is the philosophy of Parker Corporation which is creativity, wisdom, internationality, and vitality. Could you please tell us more about this?

The four principles on which our company is based are very important. The concept of the light bulb where it lights up in your head and a bright idea comes up. We implement and deliver this idea to meet the expectations of our customers; this is the number one word of our corporate philosophy, which is creativity. Wisdom is very crucial for our company to operate and to introduce the best proposal to our clients and to have a broad understanding about the markets, especially seeing it through the eyes of the customers and seeing it from a wider perspective.  Vitality is translated into having the passion and being proactive towards anything that surrounds us as a company.  Internationality came up from the idea of going global. However, we have already introduced many products to global markets and it is ongoing. Therefore, the word internationality, in the future, we will change that to diversity.


Talking about diversification, your company supports the automotive industry, electric, chemical, and electronic industries, both domestically and internationally. With the wisdom and know-how that you have accumulated, is there any specific field that you would like to tackle in order to capture more of the global market?

At present, our major sales are for the automotive industry, particularly sealants, sound insulation products and conventional chemicals, which are our major products. Talking about our overseas business, China’s market is attractive. Next, we put some kind of priority, our current focus, which are fine chemicals for the semiconductor manufacturing industry. Japan is ahead of many countries, regarding technology and know-how. However, countries like China and Taiwan have better approaches, and for this reason Japanese companies have localized their production in these countries. We have fine chemical manufacturing facilities in these countries.


Looking ahead into the future, what are your midterm strategies to continue your corporate goals?                                                                                                                             

In regards to your question, among our midterm strategies, what we are especially putting effort into is continuous globalization. We have seen some existing customers in Vietnam and Turkey that have localized their productions in these countries. It is our policy to respond to the needs of our customers for their localization. In the meantime, the other potential that we see is in the semiconductor business, where the needs are increasing. We are thinking of prioritizing the production of fine chemicals for this area.

In recent trends we have seen different Japanese companies that are now trying to shift overseas to find partners in terms of co-creation and joint development to penetrate new markets on a global scale. How important is co-creation for your company?  Is your company constantly open to the idea of working together with foreign companies?

There has always been a concept of co-creation held here at our company. For example, after introducing the fine chemicals that we produce, some other companies that are acting as our partners would like to be selling these fine chemicals to other companies as well. Our company already has a record of co-creating products including chemicals with foreign companies.


The Japanese companies, interestingly, invest massive amounts into their R&D to introduce new products and technology as well as to be competitive domestically and globally. Could you please share with us your R&D capabilities and do you have any upcoming chemical products that you’d like to showcase to us and to our international readers?

We cannot disclose any particular ones because we observe a certain level of confidentiality involved with our business partners for the idea of co-creation. We cannot reveal any undergoing projects and some confidential pieces of information. At one point our company shifted from producing cleaning agent chemicals to producing chemicals for the semiconductor industry.

The chemicals that we would like to introduce, in particular, to foreign readers are the chemicals for the semiconductor production process.  As an example, we produce the chemicals for semiconductor production processes that are used for 5G communication electronic parts of self-driving cars.  Since the recent electronic parts are becoming more and more downsized due to miniaturization, film thinning and multi-layering, the adaptation to new processes and new materials is becoming more and more important. Originally, in the business of the chemicals for this area people found value in high purity and high quality by removing impurities to the utmost limit. Our company, however, finds new value in adding value to the function of such chemicals. We are confident that we can contribute to customer satisfaction and the development of the industry by continuously providing such solutions.


To increase your presence in the semiconductor industry, what kind of strategy are you planning to implement?

One is proactivity and cooperation with academic circles and participation in consortiums of the industry to conduct research beforehand so we can come up with a solution in the near future. Especially in this electronic parts industry more or less we can see the future some five or ten years ahead. With the information that we currently have in our hand, we can do research and development with it. This is something we are already doing for the expansion of our company.


It is quite a challenge for a company to be a major player in the domestic market, and it is more challenging to capture the global market. As a company that has been successful on the global scale, what are your international strategies?

Some of our existing customers are localizing their productions overseas. There’s only two choices, either go or not go with them. It depends on the situation. If we go with them, then obviously we could expand in this market, which is the choice that we prefer. In most cases we prefer going solo if we try to capture new markets overseas.


Imagine we will come back to interview you again in three years, what would you like to tell us? What are your dreams for the company and most importantly, what legacy would you like to leave for the next generations?

One important point is that I want our company to grow steadily. We are not the kind of a company that experiences financial results that suddenly reach great heights. We want to preserve steady employment and continue to grow. Parker Corporation would like to continue providing even more satisfaction and solutions to our customers.