1. Ajinomoto Co Inc - Packaged Food -
Japan
Euromonitor International : Local Company Profile
December 2009

2. Ajinomoto Co Inc - Packaged food Japan
List of Contents and Tables
Strategic Direction .................................................................................................................................................. 1
Key Facts ................................................................................................................................................................. 1
Summary 1 Ajinomoto Co Inc: Key Facts ............................................................................................ 1
Summary 2 Ajinomoto Co Inc: Operational Indicators ........................................................................ 1
Company Background............................................................................................................................................ 1
Production ............................................................................................................................................................... 2
Competitive Positioning.......................................................................................................................................... 2
Summary 3 Ajinomoto Co Inc: Competitive Position 2008.................................................................. 2
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3. Ajinomoto Co Inc - Packaged food Japan
AJINOMOTO CO INC
STRATEGIC DIRECTION
• As packaged foods in Japan matures, Ajinomoto will turn to other business areas, especially amino acids
and pharmaceuticals. The company also supplies ingredients to competing food manufacturers, which offers
a stable flow of income even if the company loses share to these competitors.
• The company will continue to operate an accelerated cost-cutting policy, which saw it make cost savings in
manufacturing and raw material procurement of just over ¥6 billion in 2008. The company will also
focusing on achieving economies of scale, forming an agreement with Ito Ham Foods Group to pool
resources in terms of procurement and manufacturing at home and abroad.
• Ajinomoto continues to look to new product areas in order to maintain production volumes and was one of
the first major manufacturers in Japan to enter into full cooperation with private label retailers. In early-
2009, the company announced it would begin producing private label mayonnaise in the hope that low-
priced products could challenge leader QP’s dominant share.
• The company implemented A-dvance 10 in 2005. This is a medium- to long-term plan covering the fiscal
years 2005 to 2010. This plan aims to boost the company’s domestic packaged foods sales through product
innovation and to target health-conscious consumers and the expanding number of elderly consumers.
KEY FACTS
Summary 1 Ajinomoto Co Inc: Key Facts
Full name of company: Ajinomoto Co Inc
Address: 15-1, Kyobashi, 1-chome, Chuo-ku, Tokyo 104-8315
Japan
Tel: +81 (3) 5250 8111
www: www.ajinomoto.co.jp
Activities: Food products, amino acids and pharmaceutical
products
Source: Euromonitor International from company reports
Summary 2 Ajinomoto Co Inc: Operational Indicators
Year end March 2007 2008 2009
Net sales (¥ billion) 1,158.5 1,216 1,190.4
Net profit (¥ billion) 30.2 28.2 -13.0
Number of employees 24,733 25,893 26,869
Source: Company research
COMPANY BACKGROUND
• Ajinomoto Co Inc is one of Japan’s oldest food manufacturers, with its history dating back to 1888. The
company started with the production of iodine from seaweed and, after several name changes, Ajinomoto
Co Inc was established in 1946.
• Ajinomoto was the first company in the world to manufacture amino acids on an industrial scale and
launched the world’s first monosodium glutamate (MSG) in 1909.
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4. Ajinomoto Co Inc - Packaged food Japan
• Ajinomoto has an extensive business network within the country as well as overseas. The company offers a
range of products, including seasonings, oils and fats, drinks and dairy products. It also provides
ingredients, especially amino acids, to competing food companies.
• Ajinomoto owned the rights to the Knorr brand in Japan from 1987 onwards. This helped to boost the
company’s presence in soup and stock cubes.
• Calpis Co Ltd was incorporated as a wholly owned subsidiary of the parent company structure in October
2007 while the company formed a tie up with Ito Ham Foods Group in 2008 to pool buying, increase their
buying power and know how in domestic and international sales.
PRODUCTION
• Most of Ajinomoto Co Inc’s food products sold in Japan are manufactured locally. Those sold outside
Japan are meanwhile usually produced by regional manufacturing plants, such as the company’s plants in
Thailand, in order to reduce distribution costs.
• Ajinomoto operates a strong international network spanning 23 countries and regions. The company has
105 manufacturing plants located in 16 countries, with 51 plants located in Japan. 34 of the company’s
Japanese manufacturing plants are involved in food production.
• In some cases, Ajinomoto’s packaged foods is produced by its subsidiaries. Knorr Foods Co Ltd, which
manufacturers the Knorr brand, receives raw ingredients from Ajinomoto and manufactures the end
products, which are then sold through Ajinomoto.
COMPETITIVE POSITIONING
• Ajinomoto remains one of the most recognised companies in Japanese packaged foods. However, this is not
entirely reflected in its share, with the company having less than 1% value share in overall packaged foods
in 2008 and ranking at just 15 in 2008. Ajinomoto remains a household name in Japan with its Hondashi
brand of fish stock being a staple of almost every Japanese kitchen.
• Ajinomoto continues to lead in soup, accounting for 24% of soup value sales in 2008. The company’s
Knorr brand is widely popular. Although Knorr is licensed from Unilever, Ajinomoto made significant
efforts to tailor its offer to suit the tastes of Japanese consumers towards the end of the review period. The
company focused on offering attractive flavours, with corn and consommé being its most popular flavours
in Japan. The company also focused on packaging, with the brand’s cup packaging format continuing to be
a strong seller in convenience stores and helping to add value in a product area where added value is
difficult to achieve and maintain.
• Ajinomoto was also the third largest manufacturer in sauces, dressing and condiments in 2008 in value
terms. The company has a number of leading brands in this product area, such as Hondashi fish stock,
which is almost universally used in Japanese households. Ajinomoto was the first monosodium glutamate
(MSG) manufacturer in the world and is still the largest manufacturer globally. The company accounted for
92% of MSG retail value sales in Japan in 2008.
Summary 3 Ajinomoto Co Inc: Competitive Position 2008
Product type Value share Rank
Meal replacement products 3.0% 8
Ready meals 0.5% 12
Soup 24.0% 1
Canned/preserved food 1.3% 19
Dried processed food 1.6% 10
Sauces, dressings and condiments 5.3% 3
Source: Euromonitor International
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