Deep Dive: Japanese Trading Companies (Part 2)
Closer look at the business model, management, and capital allocation
Welcome back! This is Part 2 of our deep dive on the Japanese trading companies. Building on the content from Part 1, we explore the business model and the transformation of Shosha in greater detail. We also compare the five major players that Berkshire has invested, giving particular attention to evaluating management quality and capital allocation.
In Part 1, we introduced two major business activities of Shosha: trading and investing. Let’s start by revisiting these, with an emphasis on understanding the competitive advantages that they have in each.