Japan's gross pharmaceuticals production, which was 4,576 billion yen in 1965, broke the one trillion yen barrier in 1970, the two trillion barrier in 1976, three trillion in 1978, and four in 1983. Japan's pharmaceuticals industry passed the crawl, walk, and run stages in six, two, and five years, respectively. There were big and small surges, but post-war growth was continuous until 1984. While that was the first year that Japan's pharmaceuticals production surpassed 4 trillion yen, it was also the first year of negative growth, albeit slight.

In the general pharmaceuticals field, 1984 production (5,569 billion yen) was only 20 billion yen more than 1983 production (5,547 billion yen), an annual growth rate of only 0.37%. When increase in commodities prices is taken into account, this is actually a substantial decrease.

In 1979, the year gross production first exceeded three trillion yen, production was 4,803 billion yen. In 1983, the year gross production first hit the four trillion yen mark, production was 5,547 million yen. Even though gross production increased by 33%, general pharmaceuticals production increased by only 15%. This phenomenon indicates that the component ratio fell. In other words, by 1983, the 20% component ratio seen between 1965 and 1975 had fallen to 13.8% (according to the "Pharmaceuticals Industry Annual Report").

If we look at the consumer side, the ratio of household expenditure devoted to medical supplies remained largely steady at 0.5% for 10 years. If we consider the amount of money involved, 1,500 yen in 1983 and 1,460 yen in 1984, that did not change much either (according to the Management and Coordination Agency's "Family Budget Survey").

What do these statistics show?

First, a low growth rate developed throughout the industry, and rather than growing, gross production stabilized or decreased. Does risk in the industry equal a risk to Kobayashi Pharmaceutical? The answer is "no".

Of course, the global market is not going to grow -- in other words, the pie will not get any larger. To survive one must increase one's share of the pie. Expanding Kobayashi's market share is the only way for us to survive and grow.

Kobayashi Pharmaceutical must strive to be a top enterprise that is adapted to the Information Age.

In the past, the goal of our predecessors was very simple. It was to be the best in the industry -- that was all. It should not be that difficult for us to realize that goal.

To be number one, prominently displaying our figures is not enough. Sooner or later it becomes necessary to focus on value added sales. A posture that focuses on value added is unavoidable today, because, unlike in the halcyon days of the past, sharp rises in sales are now difficult.

From 1945 to 1965 we had strategies appropriate to that era, and since the 1980's we have had strategies appropriate to this era. This era's strategy is based on DSP, which provides rear support to businessmen, and the KICS system, which works alongside businessmen, doing as much if not more work than they do. These two new computer-based systems have completely revolutionized our centuries-old pharmaceuticals wholesale business. (From an interview with Yutaka Kobayashi)