Long-term Management Plan
In fiscal 2007, the Sumitomo Forestry Group launched the long-term management plan "Project SPEED" with detailed guidelines for a strategy to attain specific performance targets in fiscal 2016.
The Meaning of "Project SPEED"
SPEED denotes the swiftness with which we expect the plan to be implemented and produce results.
It serves as an acronym for:
"Strong Passion Enables us to become an Excellent company by implementing Detailed strategy."
Perspective on The Future Business Environment
- In the domestic housing market, which has the greatest influence our Group results, the core owner-occupied housing market segment is expected to shrink gradually as the country undergoes a trend decline in population and the number of households.
- The remodeling market is likely to expand as the stock of housing grows and housing structure durability improves. Business opportunities are also likely to increase in the real estate industry as new methods of offering value-added services and products emerge.
- We believe the global economy will remain healthy as the BRICs economies continue to rapidly expand and those of the Unites States and the European Union remain strong. We expect environmental issues to heighten demand for environmentally sound raw resources leading to growing global demand and increasingly diverse use for timber and construction materials.
Background of The Long-term Management Plan -Creating a Business Srtucture with Diverse Income Sources-
The Sumitomo Forestry Group's operations began with the forestry and timber business and have expanded outward to encompass a diverse range of business related to wood and housing. As we stand now, our income sources are strongly focused in our custom-built detached wooden housing and our distribution and manufacturing of timber and building materials businesses. Expanding the Group's income will require that we develop synergy effects among our current businesses and diversify income sources to create a business structure capable of producing and sustaining increased income flow.
After full consideration of the current and future conditions in our operating environment (the perspective described above), in fiscal 2007 we created our long term management plan Project SPEED. This plan sets out a detailed guideline for the ongoing strengthening of our current core income business - the New Custom-Built Housing Business and the Distribution and Manufacturing of Timber and Building Materials Business - and allocating the income they produce as well as human resources and other management resources to concentrated investment in our priority growth businesses - the Overseas operations, Real Estate, and Remodeling business - to promptly create the new profit-earning operations that will become the future pillars of the Sumitomo Forestry Group.
Strategies and Targets for Each Business Division
Sumitomo Forestry's Long-Term Management Plan, Project SPEED, is a business plan comprising a long-term vision and a road map for realizing that vision. The plan seeks further strengthening of two current core businesses- new custom-built housing, and timber and building materials- and a shift to a more balanced business portfolio that better matches the times, to be achieved by focusing managerial resources into profitable businesses of the future- overseas operations, real estate, and remodeling and renovation.