Katsunori Kida, President and CEO of CBC AMERICA, LLC
The NC Japan Center was honored to sit down with Mr. Katsunori Kida, President & CEO of CBC AMERICA.
CBC AMERICA is a very important member of North Carolina’s industry and local Japanese community. It is a subsidiary of CBC Group, headquartered in Tokyo. CBC Group “…encompass[es] a wide variety of fields ranging from chemicals, synthetic resins, and pharmaceuticals to electronics components & devices, security devices, and more.”
We spoke with President Kida about his background and how he came to lead one of CBC Group’s important international bases, as well as CBC AMERICA’s businesses, how they came to North Carolina, and their vision for the future.
Jonathan: How did you start working at CBC, and end up becoming the President of CBC AMERICA?
President Kida: Actually, my career at CBC is about 33 years. So, this is the first and only company I’ve ever worked for.
Jonathan: For many people in Japan, it’s the same way (laughs).
President Kida: Yes, that’s very true (laughs).
President Kida: I actually started in sales of chemical materials, especially for the export business, from Japan to overseas, like Asia, Europe, and the U.S. This was my first job at CBC Japan, Tokyo. When I was 29 years old, I moved to CBC Singapore, and I started the distribution business over there. This was handling security products, including lenses, recording devices, software and so on. I spent seven years over there. Then, I went back to Japan around 2002, and then in 2003, I moved to London. At that time, my role was managing the European branches, from London. Actually, this was not just for security products, but also chemicals, pharmaceuticals – all the business we’re doing over there. Then, in 2008, I moved to Milan, Italy, because we bought a pharmaceutical – API (“active pharmaceutical ingredient”) manufacturer, in Milan.
Jonathan: Right, right.
President Kida: Yes. We had to run that company, and as president, I moved to Milan.
Jonathan: A beautiful place, by the way – Milan.
President Kida: Yes – a very nice place to live.
President Kida: But the job was quite tough! Anyway, after three years of being president over there, I moved back to Japan in 2010. At that time, I was promoted to a Board Member of the CBC Group, around 2015.
President Kida: Around that time, CBC AMERICA shifted its office from New York to North Carolina, and during this transition period, our operation was quite shaky. I was asked to stabilize our operations. So, I came to North Carolina.
President Kida: And so, this is now my fifth year in the U.S.
Jonathan: You have been all over the world!
President Kida: More or less!
Jonathan: Well, I’ve been fortunate enough in my career to travel to some of the places you mentioned, and those are totally different business cultures.
President Kida: (nods) Yes, they are.
Jonathan: I know that’s quite a challenge, but I’m sure they needed you there to oversee those operations! That’s quite an important, continuing journey.
Jonathan: At a very high level – what are main deliverables of CBC AMERICA?
President Kida: We have three business segments here: security products, chemicals, and pharmaceuticals. The security group is the biggest in our operation. But at this moment, as a group, we want to grow our pharmaceuticals business in the United States. This is my mission. And now this segment is booming, specifically pharmaceuticals and agrochemicals – these two segments. We will have to grow and establish new business in the agrochemical industry and the pharmaceutical industry, by making investments and so on.
Jonathan: There’s been a lot of mergers and acquisitions in the pharmaceutical industry, especially by the big players. There have been a number of those acquisitions happening in this area.
President Kida: Yes.
Jonathan: As you know, we have quite a unique confluence of business sectors and know-how in this area. We have Research Triangle Park, or “RTP,” which is very famous, and we have institutions like NC State and others, that are involved in collaborative research with industry. And then we have the supply chain – we have ports and huge distribution centers.
President Kida: Right!
Jonathan: Looking forward, short-term – a year or two years, mid-term – three to five years, and then long-term, for CBC AMERICA, as you said, you’re getting into the agrochemical and pharmaceutical sectors – what are we looking at for those short-, mid-, and long-term plans?
President Kida: Actually, we have more than 50 years’ experience in the United States. In this period, we’ve been working well, but at this moment, in the agrochemical sector, we have only a certain amount of business, as well as in pharmaceuticals. But we will have to increase the volume dramatically – this is our mission. As I explained to you, we bought an API manufacturer in Italy, and their business is booming. Their main market is the United States. So, by utilizing their competencies, we want to increase our pharmaceutical business volume in the United States. This is the immediate (short-term) target.
President Kida: Another way for us to grow our pharmaceutical footprint in the U.S. is some type of investment. So, we’re looking for this type of opportunity. But it will take a little more time, because as you can see, we’re not the size of companies like Mitsubishi or Mitsui – they’re giants. So, our funding is also not to that scale. We need to find a good-sized niche market – we have to study many segments and find a good opportunity here in the U.S., and it will take time. This is more mid-term or just at the line for long-term – maybe five, six, or seven years. Then we’ll need to establish an M&A.
Jonathan: Understood. You mentioned that CBC AMERICA is not that large, but of course, the central office in Tokyo is quite established and large.
President Kida: Yes, that’s true.
Jonathan: The best “blend” for Japanese companies with operations in the U.S. seems to be having that strong leadership in Japan, and allowing that U.S.-based business unit a certain degree of autonomy – they can make their own decisions within a fairly wide spectrum. This allows them to be agile – they can move. They don’t have to wait for a long time for decisions to be made from corporate.
President Kida: Yes.
Jonathan: And as we become more global – and that’s really the only market now – the global market…
President Kida: (nods) That’s true.
Jonathan: …quick, smart decisions are very important.
President Kida: Yes.
Jonathan: Do you feel that CBC AMERICA is well-positioned to make those smart, quick decisions that you need to make in where you want to expand – in pharmaceuticals and agrochemicals?
President Kida: Yes, because we are a bit of a special kind of company. We aren’t public – we’re a privately owned company. So, as far as decision-making is concerned, we’re quite quick. We don’t have a lot of steps. Once we’ve found a good opportunity, we can go straight to the owner to discuss how to do it. So, it’s not a long process.
Jonathan: That’s very similar to, for example, YKK.
President Kida: Yes! That’s right.
Jonathan: They have a very agile leadership team. And they’re also very successful in America, like CBC AMERICA, largely because of that mobility.
President Kida: (nods) Yes.
Jonathan: This is something that, in my professional view, many large, “traditional” Japanese companies are facing challenges with: entering and being competitive in the global market. The process is so long – the whole concept of “nemawashi” (consensus-building) and passing the “ringi-sho” (document used for stakeholders to “sign off” on a decision) around to everyone. So it’s fantastic to hear that your leadership and your team are so agile and ready to go.
President Kida: Yes.
Jonathan: Looking at the decision to move from New York to North Carolina – now that you’ve been here a number of years – and thank you very much for your support of the NC Japan Center, we’re very honored and appreciative of that…
President Kida: It’s our pleasure!
Jonathan: …and please be honest here – in a general sense, not just looking at CBC AMERICA, but all Japan-owned companies in North Carolina, how can we do a better job of supporting you? “We” being higher education, government, and private investment – how can we, as a state, do a better job to support Japanese businesses here?
President Kida: (smiles) It’s very simple! We need DIRECT FLIGHTS to Japan from North Carolina. This is very important.
President Kida: The problem we’re facing is having less guests from Japan and overseas. In order to go back to Japan, our guests will have to go back via New York, D.C., or Houston or Chicago…
Jonathan: Atlanta, DFW…
President Kida: …right. We’ve had several guests not be able to go all the way back to Japan because of storms or something at connecting airports. So now I have to go to Chicago or go to New York to see them – it’s very difficult. So, I’d like to have a direct flight – even from Charlotte.
President Kida: I mean, RDU (Raleigh) is better to me, but we do need direct flights. Otherwise, it’s quite difficult to engage in business activities.
Jonathan: President Kida, I’ll see what I can do.
President Kida: (laughs with Jonathan) Thank you!
Jonathan: No, that’s very important – we don’t talk about this a lot. And added onto that, how has the pandemic affected CBC AMERICA business?
President Kida: Ah, yes.
Jonathan: I suppose the easy answer is “visa restrictions;” entering and exiting Japan and America.
President Kida: Yes.
Jonathan: Not just clients – it’s everyone – they don’t want to go through the hassle – quarantine and everything.
President Kida: (nods) Yes!
Jonathan: But let’s say, other than that (visa restrictions and quarantine), has there been any effect on CBC AMERICA business?
President Kida: Actually, as you know – we have two offices in North Carolina: one is in Cary, and one is in Mebane.
President Kida: The Cary office is our headquarters, so it’s the “normal” type of office business there; office jobs, office staff.
President Kida: In Mebane, they’re doing distribution. We have a warehousing facility and manufacturing facilities, and a sales office as well. We’re handling many kinds of products over there, and during the “severe” (pandemic) period last year – like July, August, and September, the people at the Cary office were working remotely. But we can’t do that in Mebane.
Jonathan: It’s distribution!
President Kida: Right. And we’re an “essential business,” so we have to work. And of course, me too! So, I went there or I was at the Cary office, but I haven’t done any remote work. Sometimes people say that’s “unfair” or something. And of course, they feel quite scared because of COVID…
President Kida: …yes, there are many difficult piece. BUT, I’m very happy to have those good staff members over there. They kept working, even in a tough period. I’m very proud of them and I appreciate their work, so much.
Jonathan: So, as I said before, CBC AMERICA has deliverables in numerous segments. Has that diversification helped CBC AMERICA “weather” the impact of the pandemic? For example, I’d imagine the flooring business might have been pretty consistent…
President Kida: Actually, no! This is because the installation work has to be done at that site. Our main customers are hospitals, care homes, schools, and those shut down. Even now, it’s very difficult to make renovations and so forth.
President Kida: So, the construction and renovation business has gone down because of COVID.
Jonathan: I see!
President Kida: So, it had quite a big impact.
Jonathan: The construction supply chain has been quite difficult, and we’ve seen house prices go through the roof…
President Kida: Right. Yes.
Jonathan: But when you go to the CBC AMERICA office building there in Cary, you see self-cleaning door handles and stuff like that…
President Kida: Yeah, yeah.
Jonathan: So, I’m sure those kinds of innovations during the pandemic, in construction – self-sanitizing materials – have been at least more focused upon than they were before.
President Kida: Perhaps, yes.
Jonathan: But you also have other things like your pharmaceutical and chemical segments. How have those been doing during the pandemic?
President Kida: They were all affected. BUT, not so bad as others – maybe about 30%.
Jonathan: So have all of the segments for CBC Group and CBC AMERICA during the pandemic gone down? Or, have there been ones that maybe went up?
President Kida: CBC Group is doing very well! Even last year, our performance was good. But CBC AMERICA – CC TVs, flooring – these customers need to install the products, as I told you, at schools, hospitals, and even in the case of security products, our main customers are housing boards, and others like that. Big customers have no budget due to COVID…
President Kida: So, they have no budget to spend! There’s no renovation. The hospitals have been fully occupied, schools were shut down at that time, so business was almost 40% down, overall. But this year, it’s started coming back. And now, we can see the recovery, especially in our chemical divisions. Our main customers include the automotive industry, and that’s doing very well, and our overall business is good.
Jonathan: The automotive supply chain in North Carolina is very strong.
President Kida: (nods) Yes.
Jonathan: Or as OEMs (original equipment manufacturers) for the automotive industry, here.
President Kida: Yes. But the time-frame for bad effects from the pandemic was a very limited period.
Jonathan: Well, the more diversified the deliverables portfolio, the more resilient a company can be.
President Kida: Right.
Jonathan: Well, getting into agrochemicals and related areas, you know that NC State University started as an agricultural school, and the agricultural education here is top-notch. And of course, our engineers are, as well! So, if I were to speak to NC State students, what would be the advice you’d give them in order for them to come and work for a company like CBC AMERICA? What are you looking for in talent coming from universities?
President Kida: The pharmaceutical business, as I mentioned, is very important for us. We need to find good opportunities for investment. We need professional people with flexibility. For example, if we’re thinking about acquiring another API business, maybe a totally different type of opportunity will be there too, like medical devices.
President Kida: In North Carolina, I found many interesting companies. So, we’re looking for high skill with flexibility.
Jonathan: You want people with a “business mind.”
President Kida: Yes, exactly!
Jonathan: Did you hear that, Poole School of Management? We need your strong business graduates to come out here and be flexible and find those opportunities! And of course, our engineers and those involved in pharmaceutical research will continue to be very important for you, moving forward.
President Kida: Yes.
Jonathan: We are looking forward to hearing more and more success stories coming from CBC AMERICA. We’re so happy you’re in North Carolina with us and you’re employing North Carolinians…
President Kida: (nods) Yes!
Jonathan: …and the North Carolina Japan Center is always here to support those coming to CBC AMERICA on assignment with their families, helping them connect with the community and adjust to life here in NC, and to support your operations. Thank you so much for your support.
President Kida: It was a pleasure speaking with you. Thank you!
Jonathan: Thank you for your time, today!
CBC AMERICA homepage: https://www.cbcamerica.com