A Big Change for Small Manufacturers

One place enjoying a tourism revival is the city of Kamakura, near Tokyo.

The main street of the ancient capital is crowded - even on a weekday.

"I was surprised to see so many people today."

"There were very few tourists the last time I came here."

"I'm still a bit worried about the virus, but many people have begun to go out, so I did too.

It looks like a new tourism boom is starting."

This traditional sweet shop is among the businesses benefiting.

The end of coronavirus restrictions has fueled a hunger for treats - and that includes pumpkin cake.

The owner says sales in the past month have recovered to about 80 percent of the pre-pandemic level.

"People in their 40s to 70s seem to be relieved that coronavirus case numbers fell in mid-May.

These visitors on group tours picked up sharply around that time."

A government subsidy program is encouraging people to get back on the road - and the water.

Accommodation and transport discounts are on offer for those who travel within their local areas.

There are plans to expand the program this month to include trips across Japan.

Travel agencies are reporting more inquiries.

"I suppose the stores will be crowded there?"

"Yes, they are becoming rather crowded, as more and more people are taking trips."

This agency says reservations for July and August are still down by about half from 2019.

One reason...

the company has slashed the number of outlets.

It also says people remain cautious about a rebound in infections.

Even so, managers are confident the worst is over...

and are making plans to add temporary staff for the summer.

"I hope we do not see a resurgence of infections and that travel demand will continue to grow.

We will see how the situation unfolds as we prepare to cope."

But the sudden surge in tourists has posed a new problem.

Notices like this are now posted at sightseeing spots across the country.

A government survey shows 3.6 million workers were employed in the hotel and eatery sector in April.

That's down ten percent from the figure three years ago.

One expert says a labor shortage could stand in the way of a recovery.

"One crucial juncture will be the coming summer holidays.

If demand picks up too quickly, there is a risk that tourism businesses will fail to make sufficient profits because of the current worker shortage.

As a result, they may not be able to fully meet any increase in tourism demand later on."

The rebound has so far been mainly due to domestic tourists.

Japan began accepting a limited number of visitors from abroad in June.

If that volume starts to increase, the shortage of workers in the hospitality industry may pose an unexpected obstacle.

One of Asia's largest pet fairs is taking place in the Malaysian capital of Kuala Lumpur.

Most of the 70 or so companies on hand are pet food manufacturers.

A startup called Protenga attracts a big crowd.

People are taking notice because its pet food is made from sustainable, edible insects.

"I think that it helps the environment and surely those producers will come up with a product that my pet will like."

The company produces many of the ingredients at its facility in southern Malaysia.

Crickets and grasshoppers might be better known in the edible-insect world...

but a new star is emerging.

It's the black soldier fly.

Its larva is used because of its high-quality protein...

and the climate of Southeast Asia is ideal for cultivating it.

If left in a room set at 30ºC, the larvae will grow about 5 cm in just seven days.

The larvae can also help reduce food waste.

They devour large amounts of food scraps to achieve their rapid growth.

"Our mission with this is really to bring sustainable clean insect proteins more into the mainstream...

and turn those into high-grade, high quality concentrated protein to provide nutrition."

Protenga's pet food is a mix of boiled larvae and local vegetables...

giving it a pâte-like consistency.

Local and international sales started last year.

Some of the company's investment comes from a government-related organization in Singapore that supports its eco-friendly objectives.

A company in Thailand is also working to improve the smell and taste of edible-insect-based pet food.

Orgafeed offers a dry variety of food.

Its sales are mostly online...

and the product is growing in popularity.

Still, there's always room for improvement.

To get feedback on taste, the company is going directly to its four-legged customers...

and their owners.

"At first, I admit that the smell and the appearance might be a bit different from others in the market."

"It requires more effort to get pet owners who are used to traditional, meat-based pet food to make the switch."

The food scraps are seen as key.

Today, the larvae are being fed sediment strained from mixed fruit juice.

The company continues to experiment with different types of food waste in a bid to get the right combination.

"Our goal is to feed dogs in Thailand... and all over the world...

something that will also have a positive impact on the environment."

In the end, it comes down to taste... and nutrition.

If food that had humble beginnings as fly larvae can be pleasing to pets, then it will surely please their owners, too.

A durable paper used for making dry cleaning tags is now being used in water-resistant notepads.

And the decorative fabric that protects the edges of traditional floor mats is now being turned into a variety of useful products.

Today's On-Site Report shows how shrinking markets are causing some manufacturers to change course and shift to a business-to-consumer model.

The little paper tags dry cleaners use, allow them to write down detailed washing instructions and keep track of your clothes.

The small strips of paper are surprisingly strong and can even withstand the heat of a 200℃ iron!

The secret to their durability is a special chemical treatment that not only makes them resilient to extreme temperatures, but highly water resistant.

At this factory, water-resistant paper purchased from a paper manufacturer is cut, printed, and turned into dry cleaning tags.

There are now only four dry cleaning tag makers in all of Japan.

Second-generation owner Makino Masahiro's company trails only one of them in production.

However, demand for dry cleaning has plummeted in recent years - and Makino has seen sales drop nearly 40% since peaking in 2002.

When looking ahead, I was definitely worried that I wouldn't be able to continue doing this kind of work.

While thinking about potential new business opportunities, he remembered making a notebook out of dry cleaning tag paper when he was a high school student.

He realized its ultra-durability and water resistance could allow him to make an ideal notepad for outdoor use.

He took his idea to a small up-and-coming design firm known for its note pads and notebooks for guidance.

Despite its rugged attributes, the design team told him that because the market was already awash with competition,

creating an easy-to-use design would be extremely important.

After a few consultations, they came up with a curved, narrow design that made the notepad easy-to-hold in one hand.

But the unique new design wouldn't be cheap to produce.

Makino decided to spend $150,000 to purchase the machinery needed to produce the notepads himself.

Once you get going, you have to go as far as you can.

If you can't commit, you won't be able to achieve any significant results.

To check its toughness we gave it a spin... in a washing machine.

Anything written inside remained perfectly legible.

And, despite being soaking wet, the pages can still be written on and remain as strong as ever.

The combination of design and features didn't go un-noticed - in 2016 the notepad was chosen as a winner of the prestigious "good design award."

This flower shop specializes in growing orchids.

Every employee carries one of Makino's notepads and uses it on a daily basis.

We work in a really wet and dirty environment, so I thought it would be perfect for us!

While customers often just throw dry cleaning tags away without thinking much about them, the notepad has given new life to the paper they are made from

and turned into a new revenue stream for Makino.

Taking on a new challenge like this doesn't just allow you to break through the conventional way of seeing and thinking about things,

it can lead to completely new ideas.

I believe this will create a synergistic effect that can benefit the entire future of my business.

The floor of this traditional-style Japanese room is covered by rectangular floor mats called "tatami."

Usually made of woven straw, the edges of each mat are covered with a decorative 8 cm-wide strip of fabric, called "tatami-beri."

This factory specializes in producing "tatami-beri."

In a single year, the facility's 100 looms produce nearly 17 million meters of the product.

Using a vast array of colors and patterns, the company produces over 1,000 different designs.

Usually, "tatami beri" is sold directly to skilled craftsman.

They then carefully stitch the fabric around the edges of the woven floor mats as a final step before they're ready for use.

However, demand for tatami floor mats has been steadily declining - and is now down more than 80% from its peak.

Sixth generation company president Takata Naoshi has helped the company to remain atop the market, but realized that in order to survive, his company needed to be flexible and willing to adapt.

It doesn't matter how big your slice of the pie is if the pie itself is shrinking.

I've been worried for years that the whole market is at risk of disappearing.

About 10 years ago, Takata noticed a strange shift begin to happen.

Apparel companies began purchasing "tatami beri" to make accessories, like hand bags, and individual customers also began asking if they could purchase the material directly.

In response, Takata opened a retail store on the factory premises in 2014 that would allow his company to sell "tatami beri" to the expanding range of new customers.

A 10m roll of the fabric starts at around $8.

Not only is the material light and durable, it's great for use in a variety of different crafts.

The company has also developed a range of do-it-yourself kits.

From a simple necktie-shaped key chain that can be completed in seconds, to a tote bag that combines multiple rolls of "tatami beri,"

customers can enjoy making a variety of items themselves.

With over 1,000 patterns available, the shop has continued to grow in popularity, prior to the pandemic, it had its best year yet, drawing in over 80,000 customers in 2019.

The fabric is light and stylish.

And with so many colors and patterns to choose from, it's a lot of fun to shop here!

The shop even listens to requests and regularly introduces customer-inspired patterns.

For example, this sample bag made by an employee, features a brand new kiwi design.

As much fun as they are to make, it's even more enjoyable to see how happy the new patterns make our customers!

I believe that in order to remain, change is necessary.

We're in the midst of a transition from traditional culture to pop-culture.

Hopefully, we can succeed at making "tatami-beri" a well-liked and more broadly used material.