We analyzed the capability of small- and medium-sized enterprises in the Japanese food manufacturing industry, through a review of public documents and a case study of a tofu shop. Specifically, we analyzed the strategy and capabilities of traditional tofu production. We selected managers' comments, strategy, and philosophy from newspaper and magazine articles, trade journals, published books, trademarks, designs, patents, and company web pages. The results from our case study of Otokomae Tofu Shop are as follows. The enterprise has been successful at building its brand and it has excellent managerial decision-making, strategy planning, and execution from management. Specifically, the company has a commitment to quality. Moreover, its unique distribution strategies avoid advertising costs but target buyers in well-known shops. Initially, the company president built the brand alone, indicating the company's capability of integration. The results of our research indicate the need for management to have capabilities in building capacity from scratch and forging collaboration capability. Furthermore, management should be able to integrate capability, construct capability, and relocate capability.
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