1. Characteristics of Management

Founding

     UMEICHI offers kimono rentals, various commemorative photo shoots (weddings, shrine visits, Shichi-Go-San, school entrance, graduation, coming-of-age ceremonies, etc.), beauty and dressing services for photo shoots, and online sales of kimono accessories. The store brand is "Plum" operating in Gifu and Aichi prefectures. It operates Plum Ogaki, Plum Kagamigahara, Plum Gifu Nagara, Plum Gifu Rokujo, and Plum Ichinomiya, and the Coffret brand is Coffret Ichinomiya Studio.

      Mr. UMEDA Yoshio's grandfather founded Umesho, a used clothing store (clothes and kimono), in Ono-cho, Gifu Prefecture in 1950. Mr. Yoshio's father incorporated it in 1981 (Umeshow Co., Ltd.) and moved it to Mizuho City, focusing on Seino area of Gifu Prefecture. He started selling kimonos in 1993, and over the next 15 years, his annual sales increased to 500 million yen. In 1988, UMEICHI Co., Ltd. was established to enter the rental business and began renting and selling kimonos, but around this time the Umeshow Group was at its peak, and UMEICHI repeatedly made deficits and profits for 20 years after its establishment. UMEICHI was an insolvent company that survived by borrowing money from Umeshow and executives. Umeshow's business also deteriorated due to the decline in demand for kimonos and the collapse of the so-called bubble economy, and UMEICHI was forced to consider going out of business.

Development from the verge of closure: Business Model Transformation

      Mr. Yoshio joined the company in 2011 and assumed the presidency in 2020 replacing the previous president who was not a family member. From the time he joined the company, he demonstrated his ability as the prospective president.　When he joined the company, the sales amount was 100 million yen (for the fiscal year ending June 2011), 490 million yen in 2023, and it is expected to be 550 million yen in 2024. In 13 years, sales have increased more than five times, and the number of employees has grown from 11 to over 60. Excess debt was eliminated in 2015. The company was forced to close for a month due to the covid-19 pandemic, but he repaid the 50 million yen loan borrowed under "Zero Zero Loan" without a grace period. This is a dramatic development since it was on the verge of going out of business. This was brought about by a change in the business model that he made in his second year at the company.

      UMEICHI was launched as the rental division of the Umeshow Group in anticipation of a decline in kimono sales, but it was also selling kimonos. According to President Umeda, there was a strong sense in the kimono business that renting would attract customers and lead to sales. For this reason, UMEICHI was unable to specialize in the rental business, and fell into a halfway state. However, while the purchase price of kimonos per household has been declining rapidly (2018 was one-fourth of 2002), the rental price has been rising since around 2015, and the rental price in 2018 was 74% of the purchase price. (from "Industry Trend Search"). The mainstream demand for kimonos was shifting to rentals, and the specialization in rentals was in line with this movement. President Umeda conducted sales activities himself during his first year at the company, and realized that the company was slow to respond to changes in the kimono industry, so he decided to change the business style. Mr. Umeda was an amateur at kimono, having spent three years selling job advertisements at a Recruit agency after graduating from university, and having only trained at another kimono store for about 10 months before joining Umeichi. According to Mr. Umeda, this was actually a good thing because he didn't have to be influenced by the traditional practices in the business.

      Currently, in Gifu, the company that specializes in rental kimonos is the largest buyer of furisode type of kimono. At the time, it was said in the industry that rental would not lead to production demand because the same kimono would be used over and over again. However, as kimonos have become fashionable and demand for new products continues to rise, kimono rental businesses are also increasing their purchases of kimonos. Specialization in the rental industry will also contribute to kimono production areas.

      The company specialized in the rental business and also added a photo studio. Up until then, the photos had been taken in a studio with only a white curtain, and Mr. Umeda, an amateur photographer, used a digital camera to take pictures. He turned it into a full-fledged studio staffed with professional photographers. As is the case today, many kimono rental companies claim to have their own studios, but outsource photo shoots, beauty/makeup, and dressing.

      With the kimono rental service and photo studio, UMEICHI has transformed from a "kimono business" to an "anniversary producing business." The company's management philosophy is "We will spread the "harmony'' of smiles, excitement, and happiness through the production of anniversaries.''

Expansion of Customer Base

      Five years ago, he developed the "Mommy Pack".　The average rental price is 200,000 yen, and as Japanese incomes are sluggish, many households are feeling the burden.　This service requires mothers to bring in their kimono, and the total cost is 63,800 yen including pre-shoot,　dressing on the day, hair makeup and cleaning, and it was a big hit.

      Breaking down the company's sales by ceremonial events, 60.5% come from coming-of-age ceremonies, 20% from graduation ceremonies, 10% from Shichi-Go-San festivals and babies, and 0.50% from bridal, tomesode, and visiting wear, and coming-of-age ceremony has too much weight.　On the other hand, there was a problem in that they did not focus on Shichi-Go-San and baby-related activities.　 Although the child population is not growing, it depends on the coming-of-age ceremony, and if the Covid-19 pandemic occurs again, it will be a big blow.　Therefore, in August 2023, he became a franchisee of a studio business specializing in children launched by the third largest company operating photo studios, and began to strengthen the development of the children's market. There was another aim in collaborating with this company. As the number of employees increases, UMEICHI faces the challenge of organizing the company. He wants to achieve sales of 1 billion yen and 100 employees in 2030, and 3 billion yen in sales and 300 employees in 2040. By becoming a franchisee of a major company, he is able to study organizational theory from the inside, such as how the intentions of top management permeate the workplace.

2. Labor Management

Rift with Employees

      In any company, management innovation progresses along with employee awareness innovation. Management innovation without the latter is impossible. When President Umeda joined the company, there was a big rift between him and the employees. The president wanted to create a vision for the company 10 years from now, and when he asked employees in a survey what kind of work style and lifestyle they would like to have 10 years from now, most of the responses were blank. They asked him, ”Why do I have to tell the company about my personal affairs?'' When he asked if he wanted to go out for dinner after work, the manager replied, “We don't do that kind of thing.''

      The gap became clear when the company tried to open a store in Nagara in 2014. Store Manager: "Why are you taking such a risk when you're already in the black? I won't send any staff out of my store." Hairdresser: "I don't want people to think I'm a staff member for the new store, so I have to stop." Candidate for store manager: "I will never become a store manager. I would rather quit than become a store manager." In his third year at the company, he thought the company had successfully changed its business format and was becoming a good company, but the company's culture of not demanding change had become a bedrock. Employees had zero independence in making changes, and management was someone else's business for them. He thought it was worse than having no money in his bank account.

      Since there was no other choice, the president himself became the store manager and started the business with one part-time employee from the existing store, one new graduate employee, and two locally hired employees. The members of this store were all recruited by the president, and they worked well as a team, going out for drinks every week, and their annual sales reached 90 million yen, compared to 60 million or 70 million yen at other stores. The facts showed the correctness of the aggressive management strategy and the strength of the united organization. People who cannot be persuaded by logic can be persuaded by facts.

      People also grew up from this store. Part-time employees have been promoted to full-time employees, store managers, and managers, and are now the president's executive assistance as general managers, where he is involved in employee development. She wanted to be a photographer and was not good at managing an organization, but she has changed drastically. Newly graduated employees are now managers. This store also served as manager of other stores, and became the core of UMEICHI's overall mindset change.

Management that strengthens Will of Independence: Sharing the Value of Labor

      At the same time that employees' awareness was being reformed through practice as described above, President Umeda also worked to drawing out the independence of will of employees. This management seems to have two pillars.

      The first is sharing the value of labor. President Umeda himself did not realize the value of the service industry before joining the company, and thought it was something he would do part-time. But his work changed his mind.

      The company's customers approach once-in-a-lifetime occasions, such as their daughter's wedding, with great enthusiasm and determination to make them a success. The smiles, tears, and excitement that come from responding to these demands are the great joy of working. One of the company's photographers says, "The best part of this job is that I get to see the customers' reactions to the work I do, and the most rewarding part is seeing the customers' smiles." President Umeda said that service work that takes care of people is valuable work that evokes emotion in people. The company also closed for a month during the coronavirus pandemic due to the "non-essential" theory. Everyone should now understand how precious it is to celebrate a loved one's memorable day with their family, and what true happiness is. In addition to the training described below, he spreads the value of their labor through morning meetings, interviews with employees twice a year, and letters (fax, company newsletter) to employees two or three times a month.

Management that strengthens Will of Independence: Integrating the company's Vision and employees' Dreams

      Second, he worked to integrate the company's vision and the dreams of employees. Having employees think about the future of the company based on their own dreams will lead to employees taking ownership of the company's management.

      In 2020, he spent six months creating the 2030 vision. First, employees held table discussions about what they wanted their lives to be in 10 years and what they wanted the company to be in 10 years. Based on this, executives created a draft vision and provided feedback to employees. The result is "No. 1 in creating excitement in Japan" (providing services that move both customers and employees); "No. 1 in creating beautiful kimonos in Japan" (Let people experience the "fun" and "beauty" of wearing beautiful kimonos, which are the pride of Japan); and "The best environment in Japan where people can work in their own way" (a company where people can work in their own way). The vision consisted of these three items. In order to achieve these goals of being number one in Japan, they set a goal of annual sales of 1 billion yen and 100 employees. Through the creation of a vision, employees have begun to share the company's goals and become aware of the discrepancy between current trends and goals as a problem.

New Graduate Recruitment, Human Resources Training

      One thing that definitely had an impact on changing the mindset of employees was the recruitment of new graduates, which began in 2012. Recent results include 4 people in 2019, 5 people in 2020, 4 people in 2021, 5 people in 2022, and 6 people in 2023. The total number of new graduates is 24, accounting for nearly 40% of the company's total workforce (63 people). They joined UMEICHI because they sympathized with UMEICHI's management philosophy and vision, and have systematically received personnel training based on the management philosophy and vision, starting from new employee training. As the number of new graduates increases, the number of young employees with a mindset of "moving forward" has also increased.

      The training is not like having knowledge poured over in a school classroom, but instead takes the form of a table discussion where one person expresses his or her thoughts and the learning progresses through the reactions of others. It not only makes learning more effective, but also has the effect of cultivating individual autonomy. The type of training is decided in consultation with store managers, and the theme of the company-wide training held in September 2023 was "What kind of team is a good team?" This was done for managers, store managers, new employees, and part-time employees, and then for each department. Each group had distinct opinions. During the all-employee training session in April, when new employees join the company, they discussed what the 10-year vision means to be "No. 1 in creating excitement in Japan." Training includes new employee training, company-wide training once every three months with all stores closed, and monthly manager study sessions and store manager study sessions.

Veterans also have significance

      According to President Umeda, the mindset of veteran employees has not changed. There are still many people who say, "I don't want you to tell me to think for myself," because I will do exactly what I am told. However, he believes that such people are also needed, and of the 11 employees that President Umeda had when he joined the company, currently 8 remain.

      Some people remain part-time even after retirement (formerly 60 years old, currently 65 years old), including one in his 80s and two in their 70s. The average age of UMEICHI 's employees is 33 years old, but they can work even into old age. He wants people who have passed retirement age to work comfortably, and he accepts requests to work once or twice a week depending on their physical strength. This is a flexible response that respects individual circumstances unique to small and medium-sized enterprises. Young employees can work with peace of mind if they have people with rich life experience. UMEICHI seems to have a good combination of old, middle-aged, and young people.

Two Career Advancement Courses

      It is a great happiness for working people to feel their own growth and to have their growth recognized. UMEICHI offers two career advancement courses.

      One is a management course. The company's job structure is president - general manager (1 people) - managers (4 people) - store managers (6 people) - deputy store managers (4 people) - employees. Five people at manager level or higher serve as the core of the company's operations. Within this system, the management course is for those who will be involved in mentoring juniors and company management, and in the future, the president is expected from among the employees, but for the time being, the challenge is to appoint directors from the managerial class.

      The other course is the specialist course for those who aim to master their camera and beauty skills and become professional instructors. Many people apply for specialist courses, but the number of applicants for management courses is also increasing. This is probably a reflection of the increasing number of employees who consider management their own responsibility.

The Charm of Working

      Management that encourages employee's will of independence and growth is not just for companies but it also satisfies people's desire for autonomy, the desire to be their own master at work, and the desire for growth, the desire to improve one's abilities and perfect one's personality, which also creates job satisfaction for employees. Employee's son joins the company, and every year there is at least one customer who wishes to join the company, and there are 4 to 6 new graduates joining the company every year. These indicate that the company is becoming more attractive as a place to work.

Steadily increased Salaries

      However, job satisfaction cannot be achieved without economic rewards that allow one to live a decent life. People are not satisfied with economic rewards alone, but if economic rewards are insufficient, the desire to satisfy the deficiency will drive away the psychological desire for job satisfaction.

      UMEICHI has increased the base by 5,000 yen every year for the past five years, and the starting salary for graduates of four-year universities in April 2023 was 205,000 yen, the highest in the same industry in Gifu Prefecture. The salaries of existing employees have also been raised by an average of 10,000 yen every year for the past 10 years, including regular raises.

      President Umeda says that although it is not a large raise, he has been steadily increasing the salaries of his employees to the extent possible. It is clear that he is willing to give back to his employees the profits that have increased due to the business model change, rather than allowing the company to monopolize it. This steadily increasing economic reward is the basis for the psychological reward of job satisfaction. However, President Umeda feels that the company has already entered an era where starting salaries are 250,000 yen, and feels there is a need to further increase profitability.

Human Resources are the Source of Differentiation

      The above-mentioned strengthening of employee independence through management, and the resulting positive service attitude of employees who consider customer satisfaction their own joy, differentiated the company from other companies. President Umeda receives daily reports from each store. “Currently, we are competing with 〇△ kimono stores. A customer went home, but came back the next day, saying 〇△ was 50,000 yen cheaper, and her daughter liked the kimono, but she wanted to be taken care of by that older staff, so we decided on Messrs. Plum." It can be seen that human resources are the source of the company's differentiation. When President Umeda joined the company, the average price per photographer was 48,000 yen, but the price has been raised little by little and currently stands at 98,000 yen. Of course, this reflects an increase in expenses such as album purchase costs, but the increase in average customer spend also shows the Company's strong ability to attract customers. President Umeda believes that the reason for this is the service capabilities of the company's human resources. Initially, employees opposed the price increase. He persuaded them by saying, “Customers will accept the price increase for your service.” Employees now have confidence in prices.

Challenges and Goals

      But there are also problems. This year, two mid-level talent who had high hopes for the future quit. President Umeda says he feels the most depressed when employees quit their job. The cause was that even though store managers lacked the ability to deal with people, they took over tasks such as interviews that had previously been performed by the company president.

      The number of employees at the company has exceeded the capacity for the president to be in the forefront of everything, and the company needs to strengthen its organizational strength by distributing the role of president to subordinates. President Umeda aims to overcome these challenges and develop UMEICHI  into a company that breaks away from the public image that the service industry is a world of low wages and unskilled labor.