Product Code Database
| + Seven major sōgō shōsha (billions of yen) | ||
| Mitsubishi | 1,181 | 13,803 |
| Mitsui | 1,130 | 12,064 |
| Itochu | 801 | 11,744 |
| Sumitomo | 566 | 4,991 |
| Marubeni | 543 | 5,129 |
| Toyota Tsusho | 284 | 3,377 |
| Sojitz | 111 | 923 |
The structure of sōgō shōsha can give them advantages in international trade. First, they have extensive risk management capabilities in that they trade in many markets, keep balances in many foreign currencies and can generate captive supply and demand for their own operations. They also have large-scale in-house market information systems which give them economies of scale in pursuing new business opportunities. Their vast scale also allows them to provide capital in the form of credit, financing and export services at low cost. Mitsui CEO Masami Iijima described general trading companies as similar to investment funds such as private equity funds, but distinguished by their ability to identify and implement business opportunities in various industries using the information and human resources gleaned from their trading business.
Sōgō shōsha are among the highest-paying employers in Japan. Along with financial institutions, these companies have consistently been ranked among the most popular employers for the graduates of top Japanese universities for over thirty years due to their high compensation levels, employment stability and the diversity of opportunities available to prospective employees, of which has made the recruitment process highly competitive.
After World War II, foreign trade was briefly suspended and the zaibatsu were dismantled. The powerful trading arms of Mitsui and Mitsubishi were each dissolved into over a hundred smaller businesses. When trade resumed in 1950, the first diversified trading companies emerged as Kansai region-based textile traders (most notably Itochu, Marubeni, Toyota Tsusho and Nissho Iwai) and steel traders (most notably Iwai and Nissho, which later merged to form Nissho Iwai) diversified into new business lines. The remnants of the Mitsubishi and Mitsui zaibatsu also coalesced in the 1950s to form new large-scale trading concerns. The term sōgō shōsha came into use around 1955 to refer to this broad set of firms, which by 1960 had coalesced into ten large and highly diversified companies:
Sōgō shōsha became a core component of the postwar " keiretsu" business model, in which large commercial banks played a central role in each major keiretsu with a sōgō shōsha playing a secondary central role that diminished over time.
Until the 1980s, sōgō shōsha operations were largely concentrated on supporting Japanese manufacturers' international transactions, particularly in the textile and chemical industries. Since then, Japanese manufacturers have taken a more direct role in international procurement, sales and marketing, and the sōgō shōsha have shifted their business focus to services such as finance, insurance, transportation, project management and real estate development, with much of this business conducted outside Japan through local subsidiaries and affiliates.
The collapse of the Japanese asset price bubble in the early 1990s led to a wave of mergers and reorganizations among sōgō shōsha, reducing their total number to seven.
The chaebol of South Korea followed a similar path of developing trading companies in the mid-1970s. Similar conglomerate type organizations exist in India such as the Reliance Group and Tata Group.
The United States also attempted to emulate the business model to promote exports in the early 1980s by enacting the Export Trading Company Act of 1982.
At the time the law was debated, Mitsui & Co. was the sixth-largest exporter from the United States, and sogo shosha accounted for about half of Japan's inbound and outbound trade.
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