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Model of Value Creation

We give back through our business activities as a way to express appreciation for society allowing us to exist as a company through its confidence in our products and services. Sowing as many Seeds of Joy as possible through effective use of the resources entrusted by our stakeholders and society at large is our way of returning the blessings we have received. That is our way of creating value: living the philosophy of Prayerful Management in our business practices. We Sow the Seeds of Joy throughout our franchise network to continuously enhance Duskin's corporate value.

Duskin's Value Creation Process (Commentary)

Human Capital

Duskin believes in establishing workplaces where employees respect each other, and are respected, regardless of gender, age, nationality, career, lifestyles, or any other factors, thus empowering all employees to exert their talents to the fullest of their potential.

We are dedicated to educating and nurturing human resources at the three educational facilities of the Seishinkan Guesthouse, Duskin School and Mister Donut College, and in FY2019 significantly increased annual average hours of training per person to 18.4 hours.

Social Capital

We focus on training and education of franchisee personnel, as our goal is to help customers live in comfort and with peace of mind through our products and services. These services are delivered by our franchisees via our nationwide franchise network, comprising over 7,000 units and offices as well as 45 laundry plants and distribution centers. As many of the owners run their businesses in the communities and markets where they and their staff members were born and raised, they know and understand the specific needs and attributes of each local market.

To be the leading service providers in their local areas, Duskin service staff members must acquire the skill sets needed for supplying quality service. They also play a major role in making their offices and units places to Sow the Seeds of Joy throughout their communities.

Financial Capital

A solid financial foundation and sufficient cash flow have been attained by operating the businesses in ways that continue to generate sound profit. Total assets during FY 2019 stood at 185.1 billion yen and free cash flow amounted to 11.9 billion yen. This stable cash flow serves as a source for cultivating new business opportunities as well as a financial reserve for our business activities in times of crisis, such as natural disasters. Ultimately, these financial resources support and assist Duskin in our endeavors to create value for stakeholders. Going forward, we will maintain this sound financial structure and continue generating cash flow that fuels investments for growth and profit returns.

Manufacturing Capital

Duskin plants and contracted plants that provide one-of-a kind products and services are capital of indispensable importance. Manufacturing plants in Japan consist of three sites for Direct Selling Group, and two sites for Food Group. For the contracted manufacturing plants that process products and raw materials, the Quality Assurance & Risk Management team conducts periodic inspections, and constantly strives to make improvements and enhancements to quality. In addition, our specialists for food processing plants conduct extensive quality inspections, covering facility management, process management, sanitary management and production management. This wide range of items on our checklist forms the basis of our evaluations, and leads to guidance for improvements.

Intellectual Capital

At Duskin, we place value on earning the trust and faith of customers, and treat the "researching the science of clean" as a mission critical to performing our role as a member of society. Based on our core technology cultivated through the development of dust control products, we offer an array of products that possess multiple functions, and aim to contribute to the field of cleanliness and health. As of the end of FY2019, we held 137 patents in Japan, and three outside of Japan. We hold patents in our core technology that is the source of our competitive capabilities, such as product forming technology, knowhow and other ideas. In the previous fiscal year we invested 560 million yen as R&D costs.

Natural Capital

Duskin has commercialized and grown an eco-friendly recycling-oriented business based on the rental of cleaning and sanitation products. We proactively take on initiatives to preserve the environment in a number of business fields, including food processing.

We always carefully consider the impacts on society and environment at every stage of our business flows — from raw material procurement, to product manufacturing, processing, delivery, consumption and use of products by our customers, used-products collection, recycling — and focus on developing safe and reliable products and services that help to reduce our burden on the environment. During FY 2019, our Dust Control Business recycled 97% of dust control products, used 2,193,000 GJ of energy and consumed 2,217,000 m3 of water. Moreover, our businesses pay close attention to recycling products and materials so as to extract as much value as possible from these limited resources.