Introduction

In June 2013, the second Abe Cabinet turned agriculture, forestry and fishery into growth industries in the implementation of its economic policies (Abenomics) of Japan Revitalization Strategy, and planned to promote the “Sixth Industrialization” over the next ten years aiming at doubling the income of farmers and agricultural communities as a whole. Specifically, the target was set to increase the market size of “Sixth Industrialization” from the current one trillion yen to 10 trillion yen in 2020. Legal basis supporting this policy is the Act on Creation of New Businesses by Operators of Agriculture, Forestry and Fishery Utilizing Local Resources and Promotion of Regional Products enacted by the previous DPJ regime in March 2011.

Data from business entities following the “Sixth Industrialization” shows that as a result of the government’s policy implementation, their total sales had increased significantly in 2012 after a short decline in 2011. With the growth strategy of agriculture, forestry and fisheries industries promoted by the government, the “Sixth Industrialization” has been growing steadily in Japan. As to the number of business entities by sales size, entities with sales no more than 5-millionyen account for more than 60%, of which 30% are less than 1 million yen.1) In other words, current stage of the “Sixth Industrialization” is mainly focused on small-scale individual entities, which have not yet grown large enough to affect regional economy from an industrial perspective.Fig. 1

As proposed by Imamura (2010), business entities of the “Sixth Industrialization” are individuals or corporations who are engaged in secondary and tertiary industries such as processing, distribution and sales of agriculture, forestry and fisheries industries. However, these entities are relatively small-scale and have limitations in areas such as product development, distribution, sales, finance, technology, as well as marketing strategy.2) Although supports are provided by planners and financial sector in the business planning stage, follow-up supports, which are also necessary for sustainable development, are insufficient.

Under these circumstances, “Sixth Industrialization” has been redefined by Ministry of Agriculture, Forestry and Fisheries and Ministry of Economy, Trade and Industry to unite individuals, corporations with small and mediumsized regional enterprises engaged in the secondary and tertiary industries in areas of product development, marketing and sales. Also, intermediary supporting organizations have emerged recently to provide services for this cooperation.

Therefore, in this report, a project named “Sixth Industrialization Promotion Council on Food and Tourism in Southern Hokkaido” (hereinafter referred to as the "Council") was chosen as a case of an intermediary support organization to study the current situation and efforts of the follow-up support system.

Framework of current policy on the Sixth Industrialization

Following the enactment of Sixth Industrialization Act, Japanese government had launched the project of “Comprehensive Programs to Promote the Sixth Industrialization” in 2011, “Transformation of agriculture, forestry, and fisheries into growth industries” in 2012 and “Expand the Sixth Industrialization in Rural Areas” in 2013 with respective budgets of 13 billion, 9.5 billion and 8.7 billion yen to promote the Sixth Industrialization(Ministry of Agriculture, Forestry and Fisheries (2015)). However, three problems were revealed in the follow-up support system of 2011 and 2012. First, promotion activities beyond prefecture were not well developed. Secondly, cooperation between the support centers was insufficient, and initiatives were in various degrees in different prefectures. Thirdly, counties, municipalities, and public interest organizations (such as foundations) who knew the actual situation had shown a low level of participation.3) To solve these problems, Ministry of Agriculture, Forestry and Fisheries announced “Revision of the Sixth Industrialization Supporting System” in 2013 to call for cooperation with Ministry of Economy, Trade and Industry (a collaboration between agriculture, commerce and industry).Fig. 2

Amended basic ideas are shown in Fig. 1. 1) to support works related to the growth industry at national level. 2) to select and dispatch superior personnel to improve support level. 3) to forge a system that encourages and facilitates involvements of local authorities and foundations to sustain and promote the Sixth Industrialization. Based on this, the Ministry of Agriculture, Forestry and Fisheries had reorganized the support system, from the previous struc- ture that proceeded at the prefectural level with commissions from the central government to the current structure with both national stage and prefectural stage. Also, the Ministry of Agriculture, Forestry and Fisheries had confirmed local authorities as well as associated organizations as support entities of the Sixth Industrialization. It can be expected that local governments, which are familiar with the local industries and resources, are more suitable for the development of the Sixth industrialization based on their conditions. Moreover, a comprehensive support from cooperation between local authorities and foundations is contemplated.

The comprehensive support system of the Sixth Industrialization is studied in the following section with a case, a foundation jointly established by municipalities and private enterprises.

Overview of Hakodate Regional Industry Promotion Organization (Public Foundation)

(1)Overview of Hakodate City

Hakodate City is a city located in the southern part of the Oshima Peninsula of Hokkaido, separated by Tsugaru Strait from Honshu Island (Table 2). It was the administrative center of Hokkaido from the Edo period until 1871 when the government authorities were transferred to Sapporo. The geographical conditions of Hakodate facilitated its growth as a port and the base of northern sea fisheries. Also, as Japan's first open port (1854), Hakodate City has maintained various cultural heritages and a beautiful natural landscape which also increases its attractiveness of tourist destination (Fig. 3).

However, as shown in Table 1, the population of Hakodate City has been rapidly decreasing with a growing proportion aged 65 or over, which has reduced the vitality of the regional community and led the city to be designated as one of the depopulated areas in 2014. Demand for regional vitalization was raised on the public side.

(2)Establishment and structure of Hakodate Regional Industry Promotion Organization

Hakodate Regional Industry Promotion Organization (hereinafter referred to as the “Foundation”) is formerly known as the Incorporated Foundation Technopolis of Hakodate Technical Promotion Association (hereinafter referred to as the “Association”), which was established in 1984 to promote the cooperation of industry, academia and government. In particular, the Association was funded by Hokkaido, Hakodate-shi, Hokuto-shi, Nanae-cho and several private enterprises aiming at supporting business activities of regional companies in Hakodate.

Hokkaido Industrial Technology Center (hereinafter referred to as the “Center”) was established in Hakodate in 1986, two years after the establishment of the Association. At the same time, the Association took over the management and operation of the Center from Hokkaido and moved its secretariat from Hakodate City Hall to the Center. The Association conducted a project call "promotion services for regional technology startups" in 1990 to provide support for entrepreneurship. In 1998, it entrusted the management and operation along with the establishment of the Hakodate City Industrial Promotion Center. Later in 1999, the organizational restructuring was made, in which entrepreneurship promotion office and marine food processing department were added to the existing R&D department to strengthen the system of entrepreneurial support and marine food processing research department. In the 2000s, it changed the name to the current Hakodate Regional Industry Promotion Organization from Incorporated Foundation Technopolis of Hakodate Technical Promotion Association and carried out reorganization as shown in Fig. 4.

The most important point in the Association's management and operation is that the management entrustment from two centers had brought experiences for the development of technologies and new product, and made an approach to technology development department possible.

(3)Business of Hakodate Regional Industry Promotion Organization

As shown in Table 5, there are five main services in the Foundation including fund supply, sales channel development, technical assistance, personnel training, consultation services and support for startups.4)Fig. 5

Regarding technical assistance, as previously mentioned, the Foundation has been entrusted with the management and operation of the Hokkaido Industrial Technology Center. It has established a support system to provide technical assistance for product development, requested testing and analysis, joint research and commissioned research. New businesses and products have been developed through this support system with technological innovations such as the freshness retention technology to keep marine products fresh with living cuttlefish and slurry ice (Table 6). Noodles and chocolate using Hakodate grown kelp as a raw material have been jointly developed with the Gagome Union as a brand named "Gagome Kelp", as stated below (Table 7).

As to the personnel training, the Foundation has organized several promotion activities to activate regional industry including providing grants for technician training, receiving trainees, as well as hosting technical sessions. Part of expenses for the technician training is granted to promote technology transfer regionally. Dispatch destinations are usually advanced domestic enterprises, research institutes, universities, as well as small and medium-sized enterprises.Fig. 6Fig. 7

In addition to external training assistance, the Foundation also has training center inside for technical training and acceptance of trainees. Technical training has been carried out for regional enterprises to learn basic and applied technology, as well as leading-edge technology. There are three types of technical training: general technical training; practical technical training centered on the use of implements and equipment from the Industrial Technology Center; and individual technical training customized according to the specific requirements of certain enterprises. Table 2 shows the frequency and number of participants of each technical training. Most of the trainees are technicians dispatched from local companies to get trained in the Industrial Technology Center.

The foundation has also launched entrepreneurship promotion project and backpack grant project to support business startups.

The entrepreneurship promotion project, jointly initiated by the Foundation and the Hakodate Industrial Support Center, includes three stages, introduction, development, and practice. Seminars are held in each stage. The introductory seminar provides basic knowledge and information of startups. In the development stage, how to formulate a business plan is taught with practical training. In the practical stage, seminars for would-be entrepreneurs are implemented in two terms, the former for making individual business plans and the latter for individual consultations.

The backpack grant project is set up to provide a part of expenses, as much as 5 million yen, for selected business plans at the beginning, with two conditions, 1) base of the business should be located in Hakodate; 2) the business should be started within five years.

In addition, a support network has been set up in Hakodate with several experts such as company managers, financial institutions, and tax accountants. This support network is accepted by the Foundation through accredited registration to provide consultation to new graduates from the two projects mentioned above.

As described above, features of the Foundation’s business can be summarized as follows. First, it provides comprehensive support to regional enterprises to help them with not only management improvement but also technical assistance. Secondly, a wide range of support has been given to those who want to start a business, as well as to the ones that have already begun. Thirdly, efforts of the interior and support from outside have been properly combined. In some cases, the Foundation is entrusted with the operation and management of the Industrial Technology Center.

Support activities of “Sixth Industrialization Promotion Council on Food and Tourism in Southern Hokkaido”

With the support of the Regional Development Support System promoted by the Ministry of Land, Infrastructure and Transport, the Sixth Industrialization Promotion Council on Food and Tourism in Southern Hokkaido was jointly founded in 2014 by the Foundation, Research Institute of Fisheries Sciences of Hokkaido University, Hokkaido Government Oshima General Subprefectural Bureau, and Hakodate-chuo Branch of Hokuyo Bank (Fig. 8). Support activities include experience-based sightseeing with seaweed in Hakodate and intermediate support activities for new product development. Subjects of support activities are Hakodate Gagome Union (hereinafter referred to as the Union) and Foodkan. The following section describes the structure of the Council, its support activities, as well as its relationship with the Union.

(1)Structure of the Council

The Foundation takes responsibilities in the Council to manage its operation as a secretariat and provide support for seminars and product development. It has been playing a core role in this council. Research Institute of Fisheries Sciences of Hokkaido University is responsible for R&D and dispatching lecturers to seminars. The Hokkaido Gov- ernment Oshima General Subprefectural Bureau is in charge of exploring sales channels and introducing exports of product development. Hakodate-chuo Branch of Hokuyo Bank works as a fund provider to promote the Sixth Industrialization with direct support and gives advice on funding applications.

As described above, the Council is constituted by a collaboration of industry, academia, government, and financial sector, and is offering a broad range of support services.

(2)Intermediate support activities

The Council has dedicated itself to developing new products with the agricultural products grown in Southern Hokkaido, promoting the creation of new business with regional tourism resources, as well as increasing consumption and job opportunities. It should be noted that the purpose of its support activities is to help business groups become independent. It is the business group who takes more responsibilities on product development, exploring sales channels and dealing with public relations, and the Council provides complementary support. Table 3 shows roles of members of the Council.5)Fig. 9Fig. 10Fig. 11

Current efforts include the following five aspects. First, to support seminar about making better use of seaweed. In July 2014, a seminar aiming at helping tourism-related business managers make better use of seaweed was jointly held by the foundation, Hakodate-chuo Branch of Hokuyo Bank and Hakodate Branch of Japan Finance Corporation. In this seminar, the use of seaweed and its functionality and derivatives were introduced, together with a seaweed food tasting party. Through this, the charm of seaweed as a tourism resource was appealed to tourism-related business managers.

Secondly, the Council provides marketing materials and advice from experts to promote product development with Gagome Kelp and to create added value as well as to explore sales channels. As to product development, in addition to direct assistance, the Council also provides advice according to the requirements of buyers and designers. While supporting sales test, it also performs a market survey to collect information for market development. In this way, the most important feature in new product development of the council is supporting market development after helping develop the product. Besides, products have been given good reputation by local consumers and media.

Thirdly, from introducing the advantages of using kelp to make local products to tourists and residents, business groups have gained experience on planning public propaganda and market strategies. The Council supported them from behind, giving advice on how to make posters, flyers, homepage, and introducing designers to help. With these intermediate support activities, sales of Foodkan has increased.

Fourthly, the Council also supported the monthly event called Hakodate Seaweed Breakfast from November 29, 2014, through December 26. This event was held by the Gagome Union to introduce and publicize Gagome Kelp as well as other seaweed food. With the advice from the Council, Gagome Union chose two hotels in Hakodate to provide seaweed dishes as breakfast. As a result, seaweed food received its popularity and has become morning routine of those two hotels.Fig. 12Fig. 13Fig. 14

Finally, the Council supported the event called Sticky Food Rally, which was also held from November 29 to December 26 aiming at promoting the consumption of Gagome food. Thirteen restaurants participated in this event and participants were invited to visit nearly 130 restaurants that provide Gagome food. The number of participants exceeded the expectation of the Council.

The ultimate purpose of the support activities organized by the Council is to promote regional vitalization through binding agricultural products with the tourism industry. To achieve this goal, the Council supported the seaweed harvesting and processing experience tour with help from Nesaki Branch of Hakodate fishery cooperative. It organized media representatives, travel company staff and related people from Research Institute of Fisheries Sciences of Hokkaido University to visit Gagome kelp harvest site and processing plant. Through this tour, the Council also gained experience from the fact that bad weather might bring adverse impact on the tour since it is organized outdoor with boats as the main means of transportation.

In the above we have introduced the work content and purpose of the Council’s support activities. Although the Council’ mission accomplished according to the Regional Development Support System promoted by the Ministry of Land, Infrastructure and Transport in 2014, it will continue providing intermediate support in the next two years. In this situation, there might be budget problems in the Council’s implementation of the support activities. However, with previously accumulated experience, the Council has been continually giving efforts to support the promotional activities and expanding its service to Southern Hokkaido.

Overview of the Hakodate Gagome Union and its relationship with the Council

(1)Overview of Hakodate Gagome Union

Research Institute of Fisheries Sciences of Hokkaido University was selected into the “City Area Program in Industry-Academia-Government” of Ministry of Education, Culture, Sports, Science and Technology in 2003. As part of its research, Gagome Kelp was developed. As a result, many companies and the Foundation, as well as the Research Institute of Fisheries Sciences of Hokkaido University have joined in the processing of Gagome Kelp and related product development. However, most of the companies in this business are small and medium-sized enterprises, which caused several problems on sales and publicity.

Meanwhile, the Foundation and related enterprises jointly founded an organization for the sales and publicity of Gagome Kelp in 2007, named "Sales Promotional Union of Gagome Kelp)" which is the predecessor of Gagome Union. The Foundation took responsibility for the union's management, and in charge of the making of the homepage of Hakodate Gagome Kelp, product pamphlets, as well as a collection of recipes with Gagome Kelp. Also, it supported the sales and publicity activities of Gagome Kelp. However, as the program promoted by Ministry of Education, Culture, Sports, Science and Technology drew to a close in 2008, the Foundation withdrew from the union, leaving other enterprises in charge. Later in June 2009, 28 enterprises reorganized themselves and set up the Gagome Union for the purpose of the branding of Hakodate Gagome Kelp.

By far the number of enterprises joined in the Union has increased from the initial 28 to 39. Most of the Union’s members are small and medium-sized enterprises, including fishery cooperatives such as the Nesaki Branch of Hakodate Fishery Cooperative and the Direct Sales and Processing Center of South Kayaba Fishery Cooperative. From this point of view, there is no competition between the Sixth Industrialization business promoted by the Gagome Union and the business of fishery cooperatives.

Fig. 15 shows the contents of activities of the Union. In order to increase sales, the Union has opened an antenna shop named "Nebaneba Honnpo" in 2009 to sell more than 100 items of products from its members. In addition, since 2012 the shop has begun to publish letters called "Nebaco" monthly to propagandize their products.

(2)Relationship between the Gagome Union and the Council

Hereinafter we discuss the relationship between the Gagome Union and the Council from the economic and activity aspect. Although the Council was founded less than one year, the four key members of the Council have already had experience in this area, and they are familiar with trends on the economic front.

Table 4 shows the changes in production and unit price of Gagome Kelp. Since the production of Gagome Kelp, especially the naturally grown ones, is rapidly evolving, the stability of production is the most important issue for its commercialization. To solve this problem, MEXT has been dedicated to the aquaculture Gagome Kelp since 2003 aiming at building up a stable supply system.

The unit price of Gagome Kelp had remained at around 2,000 yen per kilo before it soared to 4,282 yen in 2005 when introduced by TV programs. In 2009, the price fell to 1,245 yen per kilo. After that, although rose to some extent, it never recovered to its peak, staying at the price of 2,720 yen per kilo in 2013.

Based on this the Council investigated the sales of Gagome Kelp from 100 companies (Table 5). According to its survey, sales of these 100 companies had risen from nearly one billion yen in 2009 to more than ten billion yen in 2013. Also, items related to Gagome Kelp from these 100 companies reached more than 200 in 2013, which is estimated to be worth more than 22 billion yen, making the Gagome Kelp become the local specialty products in Hakodate.6)

Finally, from activity aspect, the Council has played a support role in the activities promoted by the Union. With support from the Council, the Union has accumulated experience and kept marching toward sustained Sixth Industrialization.

적 요

일본의 6차산업화는 농림어업인이나 그 생산법인이 주체가 되어 진행되어 왔지만, 최근에는 농상공연대를 포함하는 등, 주체의 범위가 확대되고 있으며, 그 결과 6차산업화 추진 주 체를 지원하는 지원조직의 역할이 보다 더 중요해졌다. 이 연 구는 일본의 6차산업화 추진에 있어서의 지원 실태를, 하코다 테시를 중심으로 6차산업화를 지원하고 있는 협의회와 그 사 무국을 담당하는 재단을 대상으로 하여 검토하기 위한 것이다.