Deep-dive 2021-5: Sanrio Company, Ltd
Sanrio Company, Ltd (8136 JP) is a designer, licensor and producer of cute ("kawaii") consumer products. Its most popular brand name is "Hello Kitty".
The company has three segments: direct product sales (with inventory risk), licensing of characters to third-parties as well as running two theme parks in Japan. The company has about 450 characters in its current portfolio. After designing a new character, it then markets them through its theme parks and own products. If it becomes a success, it finally licenses it out to third parties - collecting further, high-margin revenue.
The company has suffered over the past few years as the founder's son Kunihiko Tsuji passed away in 2014, causing a vacuum in the top leadership. The founder's grandson Tomokuni Tsuji has been groomed to take over the business and finally took the reins in late 2019.
The problems were manifold. Kunihiko Tsuji had been the driving force behind Sanrio's overseas licensing business in Europe and the US, the two primar…