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Sailor Possibly Being Bought Out


Olya

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I saw this today on the reddit fountain pen sub.

 

Link to the thread

https://www.reddit.com/r/fountainpens/comments/hh8em6/sailor_may_be_getting_bought_out/

 

From this article (in Japanese)

https://www.nikkei.com/article/DGXMZO60703660T20C20A6TJ2000/

 

Also talked about in this podcast

https://podcast.tokyoinklings.com/

 

The above linked article says basically this (copied from the reddit thread above)

"Financial news from last Tuesday. Sailor published convertible bond for Plus to get 2 billion Yen, which if converted to stock would give Plus over 57% ownership. Plus had been the largest holder before. Expectedly, their official stance about if they will convert that bond to stock is “no comment”.

The article also said last year Sailor booked 21 million in the red, -1.4% sales year-over-year.

The Nikkei article said Sailor is meeting difficulties with the Chinese fountain pen market, while in domestic market they are threatened by low birth rate and move to paperless business.

Comparing companies, Plus is the level of Kokuyo, giant office supplies and stationery company. They won against Kokuyo in bidding for Pentel last year. Even if they won’t interfere with the high end fountain pens, maybe help in expanding the other Sailor stationeries like roller balls and markers ?"

 

 

I don't fully understand this, red numbers are never great, but -1.4% isn't that bad?

Besides, Sailor products are so popular and regularly sell out so quickly, how can they be on a decline? Or is that maybe more tied to their robot division (though I doubt that, as the article talks explicitily about stationery).

 

How is Platinum doing?

 

Pilot is flogging so many gel pens, I doubt they are in trouble, but then I never thought Sailor could be, though the decline of just 1.4% doesn't seem exactly terrible to me...

 

On top of that "apparently they have a real problem getting the seal done correctly or something; there was a mention in the podcast that for each realo they successfully make that they have to trash one that is not successful."

Edited by Olya
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Interesting. Anything happens in business, especially at the corporate buyout/merger level. I often wonder if we here in the fp community don't overestimate the market and profitability of this "market." Selling plastic ink sticks I bet is a lot more lucrative. But what do I know.

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Market consolidation is normal. Will the Sailor brand live on, to early to say.

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Hmmm. Maybe this is the reason for Sailor to raise all their prices and stuff such as switching to smaller ink bottles.

Ruth Morrisson aka inkstainedruth

"It's very nice, but frankly, when I signed that list for a P-51, what I had in mind was a fountain pen."

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On top of that "apparently they have a real problem getting the seal done correctly or something; there was a mention in the podcast that for each realo they successfully make that they have to trash one that is not successful."

 

Just took out the realo to give it a :wub:

 

I thought Itoya was doing ok as the USA distributor but I guess things will change if the deal goes through ... :unsure:

 

Globally looks like inexpensive pens from China are making a dent; KOP dies by sheer numbers. Maybe a Queen will arise ;)

 

To resolve domestically, Japan needs more babies and a hipster analog trend with the millenials, gen z. All of which is too tall order.

 

First Olympus, now ....? :( Consolidation is no fun.

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It just needs to fully open up its complete line to the west.....if what is stated here is true. I'd find it very hard to believe they make any kind of loss on fountain pens though, or ink for that matter. Their US exclusive pens must rake in a very sizable profit, there are people who literally purchase inks by the ten dozen and far more of the range in inks and pens is available globally today than even five years ago.

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Hmmm. Maybe this is the reason for Sailor to raise all their prices and stuff such as switching to smaller ink bottles.

Ruth Morrisson aka inkstainedruth

All Big 3 have raised their prices around the same time and have virtually the same offer, incl overpriced small ink bottles!

 

 

It just needs to fully open up its complete line to the west.....if what is stated here is true. I'd find it very hard to believe they make any kind of loss on fountain pens though, or ink for that matter. Their US exclusive pens must rake in a very sizable profit, there are people who literally purchase inks by the ten dozen and far more of the range in inks and pens is available globally today than even five years ago.

Well... Exactly. That's what I don't understand. Sailor pens, all their LEs and SEs as well as their regular lineup, sell so well. LEs are sold out quicker than you can click "buy". The overinflated price of the inks seems to not have hindered people from buying them. Everyone wants to offer their own Sailor LE/SE. So how are they making such a loss (which still to me doesn't seem overly worrysome at 1.4%, which doesn't mean they shouldn't strategize better)?

 

It is possible there is some mismanagement of money and it's not simply just sales. On top of that if indeed the failure rate of the realos is 50%, then that's a huge problem and realos aren't big sellers (I think) (give all your realos hugs! maybe all your Sailors even!).

 

I don't know what the deal is with the Promenade, but there's a lack of advertizing. It has the very same slip and seal feature as the 3776 Century, yet no advertizing mentions that, ever. The success of the 3776 Century is certainly thanks to that feature (and stunning lineup, but the feature was novel and revolutionary). That whole line seems to be almost "inside knowledge" of Sailor fans (like me), as it's not offered by many retailers, few know of its slip&seal and no one uses this great model for their SE/LE.

 

I think Sailor also makes a mistake by not focusing enough on the cheaper lineup, but that seems to have changed in the past year. More Profit Juniors, Lecoules and Shikioris. If they added at least two more nib options ("M" and "B") instead of just "F" or "MF", I think they'd sell better. Pilot and Platinum usually offer all their pens in "F" and "M", which should be the bare minimum. Perhaps expand the Young Profit/Somiko lineup a bit, and here too they don't offer all nib sizes for every colour, which is just beyond baffling.

As peroride mentions, China's pens are gaining in popularity, that's a problem for other makers and they certainly need to pick up the pace a bit there and not focus on luxury so much, but focus more on the school and young professionals segments.

 

I also agree about accessability. The European market is almost neglected, but that too seems to have picked up somewhat over the past year. (Though my wallet thanks them for the lack of SEs and LEs!)

 

I don't think they might disappear and a buyout might turn out great, indeed these things tend to happen in business, but there's always a bit of fear of things turning out pear-shaped... I mean look at Parker, Sheaffer and others of today... Great they still exist, but the pens certainly aren't what they used to be (quality, usability and design have completely left the building!)...

 

That's at least my little "analysis", who knows, I might be completely off...?!?

Edited by Olya
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[ Snip....]

 

The article also said last year Sailor booked 21 million in the red, -1.4% sales year-over-year.

 

[ Snip....]

 

 

I don't fully understand this, red numbers are never great, but -1.4% isn't that bad?

 

[ Snip....]

 

You're focusing in on the -1.4%

 

What caught my attention is losing 21 Million.....

 

Isn't that a lot of money to lose in one year?

 

 

FP Addict & Pretty Nice Guy

 

 

 

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You're focusing in on the -1.4%

 

What caught my attention is losing 21 Million.....

 

Isn't that a lot of money to lose in one year?

 

 

I know 1.4% could be 100,000 or 100,000,000.... Even so.. Still! :P

 

Now, concentrating on the very low % aside, the bonds Plus has are in Yen, so I assume all currency mentioned in the article (and its translation) are Yen, that would make it a loss of approx US$ 210,000 (very roughly) (xe has the Yen to US$ right now at 21mil Yen as 196,008.64USD).

Again, not good, as said, red numbers are never great, but imo not worth sweating just yet, either. Coming up with a good strategy for the next year though should very much be a priority, we don't want the red numbers to keep coming... (though this business year might end up red again for many, the nifty little pandemic and all that came with it like furloughs and jobs lost and all that).
I also know of a big company that red numbers officially can't always be taken seriously. Can't say which company I know this of, but anyway, they say "we sold this year X and next year the goal is to surpass that". They don't surpass that number and write officially a loss and show red numbers. That is to me ridiculous, you can't grow every year, people can only buy so much for crying out loud! And it's just "oh goal not met" and not actually "expenses were this, orders that and profit this".
Aside from that, I know that numbers can also be fudged quite extensively, to look as you want them to look, good or bad. "Numbers never lie" my bum.
Maybe that's why I'm not on the business side of things, because all that seems very alien to me.
(Can't wrap my head around it, unless I set the objective and work towards it myself. Or that's what I think...?!?)
Edited by Olya
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Perhaps being bought by Plus is a plus for the survival of Sailor. 🤔

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There is a lot of speculations here. Never good. Let's wait for more facts.

 

Montblanc was bought by a Swiss group, they are still here.

Pelikan was bought by a Malaysian investor, they are still here.

Parker changed ownership several times, they are still here.

It is quite common - why not this time a Japanese company.

Edited by mke
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Hmmm. Maybe this is the reason for Sailor to raise all their prices and stuff such as switching to smaller ink bottles.

Ruth Morrisson aka inkstainedruth

They have lots of company in hiding behind size changes rather than raising price per unit - look at ice cream not-quite-pint sizes and ceral boxes. That always irks me, as it implies companies think their customers are too unintelligent to notice the implicit price increase.

Festina lente

Absence of evidence is not evidence of absence

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Perhaps being bought by Plus is a plus for the survival of Sailor.

 

 

There is a lot of speculations here. Never good. Let's wait for more facts.

 

Montblanc was bought by a Swiss group, they are still here.

Pelikan was bought by a Malaysian investor, they are still here.

Parker changed ownership several times, they are still here.

It is quite common - why not this time a Japanese company.

You're absolutely right, I have thought the same as well.

 

Buyouts have people usually in a tizzy though, customers as well as employees...

When WHSmith bought CultPens the panic was also quite real..

 

 

They have lots of company in hiding behind size changes rather than raising price per unit - look at ice cream not-quite-pint sizes and ceral boxes. That always irks me, as it implies companies think their customers are too unintelligent to notice the implicit price increase.

An unfortunate and deceitful tactic in pretty much every industry...

Edited by Olya
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No need to think for them.

 

Input from outside a company is usually never welcome if you are not a source they trust.

In Japan, they even don't listen to you (my experience of working for 30 years in Japan) - especially not if you are a foreigner.

Haven't you heard the complain of US daughter companies of pen makers, that the Japanese HQs are not listening to them. That is just normal.

On the other hand, the bosses are very much listening to their buddies (best friends) in the Japanese pen scene.

Welcome to the world of Japanese business.

Edited by mke
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No need to think for them.

 

Input from outside a company is usually never welcome if you are not a source they trust.

In Japan, they even don't listen to you (my experience of working for 30 years in Japan) - especially not if you are a foreigner.

Haven't you heard the complain of US daughter companies of pen makers, that the Japanese HQs are not listening to them. That is just normal.

On the other hand, the bosses are very much listening to their buddies (best friends) in the Japanese pen scene.

Welcome to the world of Japanese business.

Looks like a good business strategy/practice.

 

LOL

 

European (and North American) companies tend to visit hobby boards et al and soak up what people say for research purposes and then act on them when they make sense (some even plant their staff in such places as "members").

 

I don't understand this type of Japanese business practice... Like wot are they thinking?

 

I still frequently think back to several docus I've seen, where they say you are prohibited from dying your hair, otherwise you're unemployable (and I'm not talking crazy colours like blue, pink or similar or "extremes" like going blond/e or red, but even natural shades within your spectrum).

Ironically, Japanese people dye their hair black to be employable, as anything but black in unacceptable and perceived as fake (ie dyed) hair. Yet, the majority of Japanese people don't even have naturally black hair, but various shades of brown... Foreigners are somewhat excused and not required to be raven-haired.

 

I have great admiration for many Japanese things, from great engineering and craftsmanship to cultural notions. Yet, other things leave me totally speechless. (That said, this is true of pretty much every nation...)

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Just a short look at the shares - they are at the absolute minimum now.

2000: 16000 Yen/share

2020: 135 Yen/share

 

That hints to some structural problems. Don't know if these shares are still the same - so, caution is necessary.

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Just a short look at the shares - they are at the absolute minimum now.

2000: 16000 Yen/share

2020: 135 Yen/share

 

That hints to some structural problems. Don't know if these shares are still the same - so, caution is necessary.

Yikes. That's a 99% loss (assuming no stock splits, etc).

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Hmmm. Maybe this is the reason for Sailor to raise all their prices and stuff such as switching to smaller ink bottles.

Ruth Morrisson aka inkstainedruth

That is the nail in the coffin for me. I stopped buying the sailor ink I used to after their stupid change to smaller bottles, and i really can't justify paying that much for a plastic pen no matter how good the nib is.. the body is too.

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All Big 3 have raised their prices around the same time and have virtually the same offer, incl overpriced small ink bottles!

 

I thought Sailor only did that for the STORiA line of pigment inks and Shikisai range in the Jentle line of dye-based inks, which are by no means the company's primary ink product lines for the real mass market (i.e. for business and/or school use, in Japan and elsewhere in Asia or the globe at large). Jentle Black, Blue-Black and Blue are still available in 50ml bottles (with no price increase domestically in Japan, as far as I can recall); as are the kiwaguro, seiboku and souboku nano-pigment inks.

 

I don't recall such a thing happening with Platinum (dye-based, carbon/pigment, and Classic Ink line of iron-gall) inks.

 

When did Pilot introduce 15ml bottles for the Iroshizuku line? Not that they discontinued the 50ml bottles, so the smaller bottles are just an additional option for the consumer, without forcing anyone's hand.

 

That is the nail in the coffin for me. I stopped buying the sailor ink I used to after their stupid change to smaller bottles, and i really can't justify paying that much for a plastic pen no matter how good the nib is.. the body is too.

 

I'm still more than happy to buy Sailor nano-pigment inks; it's actually Engeika going away and Rakuten (Global Market and also its Global Express forwarding service) playing silly buggers that stopped me from buying more for now. As for the Sailor Ink Studio line, I think the selling points of it are novelty (as in "shiny" and/or "fun") and hype, and it makes sense for Sailor to position to extract more profit per millilitre out of willing consumers.

 

As for plastic pen bodies, I thought that was what fountain pen hobbyists in the Western world at large want. Sailor makes koshu-inden and kabazaiku pens (and I have and love all three models) with the same 14K gold nibs that are found in Profit Standard (aka 1911 Standard), Professional Gear Slim and Promenade models, but it's the yet-another-shade-of translucent coloured PMMA plastic of the season in the Pro Gear Slim line that gets all the attention and discretionary spending. I can't remember whether Sailor's Precious Wood of the World series (in which there are at least six different models, each with a different type of wood but the same form factor) uses the same type of nib; I think so.

 

Same goes with Platinum; so many people on forums (including but not limited to FPN) speak of "Platinum #3776" as if the product line only encompassed the single-coloured AS resin models in the Century range, and it's only new colours of such and also the Fuji Five Lakes and Shunkei "limited editions" every year that spark excitement. The yakusugi and (three) briar wood models, the (eight?) celluloid models, the ebonite model and the maki-e models of Platinum #3776 don't seem to get much love in Australia (small market, I know), Europe and North America at all. I have no idea how well those models sell in Japan and Southeast Asia.

I endeavour to be frank and truthful in what I write, show or otherwise present, when I relate my first-hand experiences that are not independently verifiable; and link to third-party content where I can, when I make a claim or refute a statement of fact in a thread. If there is something you can verify for yourself, I entreat you to do so, and judge for yourself what is right, correct, and valid. I may be wrong, and my position or say-so is no more authoritative and carries no more weight than anyone else's here.

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Who knows, maybe Cross might buy Sailor. Could make business sense since they've been outsourcing nibs for their Peerless 125 models, and the Verve before then to Sailor. Cross has been expanding into the Asian market, acquiring Sailor would boost their effort and give their fountain pens more prestige in the process. They bought Sheaffer when it was floundering, so it would not be too far fetched. Cross could manufacture their high end fountain pens in Japan along with Sailor pens, like the Waterman/Parker model in France.

Edited by max dog
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