Resolving the crisis and creating the future
A story born from "co-creation"

The November issue of UNI-SQUARE introduces a case of "co-creation" created by UNIVA Guangzhou (hereinafter referred to as UGT) and UNIVA Paycast (UPC). At the UNIVA Group, we aim to increase the corporate value of the entire group and expand profits by working together to create value for the entire group. This time, the story of "co-creation" that began when UGT introduced the client to UPC has led to 0 giving birth to 1, 1 becoming 100, and creating a "future" of infinite possibilities. We spoke to Nemoto-san from UGT and Piao-san from UPC about this success story.

Thank you very much, Nemoto-san and Piao-san, for this opportunity.

UGT Director Reiji Nemoto
UPC Solution Sales Department Piao Yu Xing

"Co-creation" saves the company from survival crisis

The example of "co-creation" is when UGT introduced the cross-border e-commerce platform "Shoplus," known as the "Chinese Shopify," to UPC, leading to a successful deal. Shoplus currently covers over 230 countries and regions around the world, with over 400 million customers. Its annual GMV (gross merchandise volume) exceeds 2 billion RMB (approximately 40 billion JPY) and has more than 100,000 shops. I'm sure that all of you who have heard these figures can now understand how big a deal this is for UGT and UPC. And UGT had a reason why they had to make this project a success at all costs.

Nemoto: "The Kumamoto factory where we manufactured our main product, IZUMIO, was closed down, and we haven't been able to sell IZUMIO since October of last year. UGT lost the majority of its sales, and we had to start a new business, or our very survival was in jeopardy."

From October 2023 onwards, Nemoto actively participated in cross-industry networking events and meetings of business associations in China to explore business trends in China. Based on the information obtained there, a real estate seminar was held in Hong Kong in October 2023. The projects that came from there also led to the meeting with Shoplus's CEO, Li. At the time, President Li was looking for a Japanese payment processing company.

Nemoto: "It was a Chinese IT company executive I've known for eight years who introduced me to President Li. He heard about UGT's crisis and wanted to help somehow, so he introduced me to President Li, who was looking for a payment agency at the time. The reason President Li trusted us and led us to the project with UPC is because he thought that UGT had various connections due to the real estate movement. There is no doubt that new perspectives and challenges that go beyond existing business were the catalyst that helped us get out of the crisis."

On January 19, 2024, Shoplus President Li and Nemoto met, and on January 31, the first meeting among Shoplus, UPC, and UGT was held. Mr. Nemoto, were you aware of the idea of "co-creation" from the beginning?

Nemoto: "Of course! From the beginning, I thought that the ideal thing would be for UPC to make the decision and for us to mutually increase value within the UNIVA Group. UPC met Shoplus's criteria for selecting a payment processing company, and President Li also praised UPC's high level of technical capabilities. However, the biggest obstacle was whether we could fulfill President Li's request to start in March 2024. The fact is, the speed of business in China is incomparably faster than in Japan. In the past, there have been cases in which business did not come to fruition due to the difference in speed between Japan and China. We were concerned that this time as well, the same difference in speed would make the difference between success and failure."

A spirit of challenge, perseverance, and in the end, superhuman strength

Even after negotiations between UPC and Shoplus began, Nemoto continued to support both companies, patiently explaining the thinking of both companies and the business aspirations of Japanese and Chinese companies.

Nemoto: "Our experience in doing business in China and our deep understanding of the Chinese way of thinking were great assets in supporting the project. And this project would not have been concluded without the efforts of Piao, who was in charge of the project."

Piao works in the Solutions Sales Department at UPC, where he is in charge of a task called acquiring, which mainly involves managing affiliated stores. The mission assigned to Piao was to close and carry out this project. However, many Japanese payment processing companies say they have a prejudice against Chinese companies, believing that fraud is a frequent occurrence, and so they often refuse to do business with them. What about the UPC?

Piao: "I'm Chinese, and I've worked with Chinese companies in my previous job, so I didn't have any prejudices about them being a Chinese company. However, Shoplus is still not well known in Japan, so I needed to make some adjustments within the company to close the deal. First of all, I focused on identifying issues and concerns from each department in the company."

The biggest challenge was the difference in speed between Japan and China, as Nemoto mentioned. How did Piao overcome this difficult problem and close the deal?

Piao: "I still can't say it's been resolved, and it may never be resolved. For example, in Japan, if they say, 'I'll take it back and think about it, and get back to you,' it takes at least two or three days, and at most a week. But in China, 'I'll check it out' means a few hours. At the latest, within 24 hours. It's impossible to completely close this gap in a short time. However, I took measures such as checking in advance any questions I could foresee. Also, in case unexpected questions came up, I got the president and my superiors involved in advance and pushed each department to act quickly and made an effort to close the gap in speed. Even so, I still can't match the speed of China. It's a lifelong task (laughs)."

Thanks to Nemoto's dedicated support and the efforts of Piao and the entire UPC team, the service was launched in just two and a half months! Currently, the service handles payments for 37 stores, and sales, which were about 200 million yen in April, have increased five-fold to 1 billion yen in August! Another 60 stores are expected to join soon.

Nemoto: "We were in a critical situation several times, but we were able to close the deal thanks to UPC's tremendous cooperation. I think that our spirit of challenge and tenacity ultimately brought about good results in this project. For UGT, there was no other way out, so we really did everything we could, and in the end we displayed our superhuman strength in an emergency (laughs). Thank you so much, UPC!"

New challenges, new businesses

What are you currently working on?

Piao: "Currently, our challenge is to increase the success rate of payments. To process payments, they go through a separate company that processes the data. However, there are an increasing number of cases where payments made overseas are deemed to be 'fraudulent' and fail. To solve this problem, we are taking various measures. One of these is to change the data processing company to an American company. Since 80% of consumers are in the US, if this negotiation goes well, we believe we can increase the success rate of payments."

What about you, Nemoto-san?

Nemoto: "Currently, this project accounts for 80% of UGT's sales. Furthermore, the amount of payments made via Shoplus at UPC is increasing by about 1 million dollars per month, and President Li has said that he would like to increase this to 100 million dollars next year, and to 300-500 million dollars in three years' time. In order to achieve this, we would like to use the success of UPC as a base to become a Chinese agent company that can propose business projects from Chinese companies. To that end, we urgently need to improve our internal structure and develop human resources."

In order to use UPC's payment service via Shoplus, you will need to establish a company in Japan. The company will be established and bank accounts will be opened in cooperation with UGT's partner administrative scrivener and judicial scrivener offices. In addition to this, UGT also plans to introduce Japanese real estate properties via its partner real estate companies, as well as introduce suppliers of Japanese products. A new future is emerging for UGT. And there are new developments at UPC!

Piao: "This project was truly challenging. I feel like I have never been so deeply involved in a single job before. It was worth it, because soon after this project was concluded, we received a similar inquiry to Shoplus. Thanks to our experience with Shoplus, our response ability and speed have both improved dramatically. We are determined to make this project a success."

Even now, while Piao is busy responding to inquiries from President Li and other Shoplus members on WeChat every day, he is also close to closing a new deal! That's amazing.

We look forward to seeing further success from UGT and UPC.

Thank you very much, Nemoto-san and Piao-san, for this opportunity.