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Long-term Vision
Our Corporate Vision
"Becoming the No. 1 Company in the Area of Ethical Solutions"
"Creating value for people and the planet."
Aiming to become a company that will continue to provide products and services that society desires through the creation of high-value-added spaces, we, ENDO Lighting, are pursuing a more luxurious environment to realize a sustainable society and focusing on creating new solutions.
Scenario to Realize Our Vision
To realize our vision, we have positioned the "creation of high-value added spaces," "reinforcement of our global competitiveness" and "expansion of business areas" as our core initiatives, and, from two perspectives, we will build a strong business foundation to support these initiatives.
During the period of this Medium-term Management Plan, we will focus on "sustainable growth in our main business" and the launch of "new business models centered on lighting" to realize medium- to long-term growth.
Basic Policy of the Medium-term Management Plan
Business Environment
Looking at the business environment during the period of the Medium-term Management Plan (FY2025-27), efforts are steadily being made in Japan to achieve the government's target of replacing 100% of existing lighting with SSL* by 2030, while overseas markets have been seeing continued growth supported by market expansion in emerging countries and the high-value-added market.
- SSL (Solid-State Lighting): Semiconductor lighting such as LED and OLED.
Business Environment
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Acceleration of initiatives to achieve carbon neutrality
- Tight energy supply
- Transition to renewable energy
- Tightened energy-saving standards in various countries
- Promotion of ZEB and ZEH
- Spread of various green building certifications
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Changing consumer behavior
- Health awareness and the expanded wellness market
- Increased experiential consumption
- Improved quality of life resulting from economic development (changes in the amount and quality of consumption and changes in lifestyles)
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Economic development of emerging countries
- Increased demand for infrastructure development due to the economic growth of Asian emerging economies
China: Shifting to expansion of domestic demand
India: High population growth and urbanization
Southeast Asia: Young people accounting for a large portion of the overall population and high economic growth rate
- Increased demand for infrastructure development due to the economic growth of Asian emerging economies
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Technological advancement
- Revolutionary applications of AI and machine learning in various fields as a result of their rapid development
- Innovation in IoT technologies and initiatives to connect cities and buildings to the Internet to offer various functions utilizing digital technology
Domestic Market Forecast
Basic Policy of the Medium-term Management Plan (FY2025-2027)
Becoming the No. 1 Company in the Area of Ethical Solutions
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Becoming a "company that earns customers' gratitude" that pursues a sustainable, more luxurious environment
- We will provide people- and planet-friendly products and services by exploring the potential of lighting to realize a sustainable society.
- We will embody our philosophy of "harmony and perpetuity of individuals and the organization" by encouraging our employees to continue expressing their originality and ingenuity and voluntarily taking on new challenges to create new value.
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Creating a dimming and color control market to become the top brand in next-generation solution lighting
- We will develop globally competitive dimming and color control products as the manufacturer in the wireless control lighting market with the leading share.
- We will achieve both ZEB (energy savings and efficiency) and wellness (comfort and health) with our know-how on lighting environments obtained through our research and experiments on lighting.
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Becoming a global IT company centered on lighting
- We will create new services by the adoption of IoT functionality and the integration of various sensing technologies and commercialize new business models.
- We will promote DX ranging from the construction of a data platform to the creation of value-added services, which will lead to improved productivity and the establishment of new solutions.
Target Indicators
To realize our long-term vision, in this Medium-term Management Plan, we have set numerical targets for five indicators as important management indicators: consolidated net sales, consolidated operating profit, ROE, SmartLEDZ's share of sales, and shareholder returns.
Priority Activities by Segment
Lighting Fixtures Business - Japan
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1. Enhancing the development of hardware and software to expand the dimming and color control market
As a leading manufacturer of wireless control solution lighting, we will pursue new added-value for next-generation solution lighting products to meet increasingly diverse needs and reinforce our market competitiveness.
- Enhance the functions of the SmartLEDZ system by reinforcing the development of its core technologies.
- Reinforce the scalability of the SmartLEDZ system mainly by linking it with external systems and devices.
We aim to expand into strategic markets by making more attractive proposals with high-value-added lighting utilizing our know-how acquired through over 40,000 projects in which we delivered the SmartLEDZ system as well as findings from industry-university joint research.
- Verify and offer solutions tailored to various types of industries in the commerce and distribution market, which is our main market.
- Communicate the benefits of dimming and color control to customers in the office market and the personal space (hospitality) market, which we regard as growth markets.
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2. Taking on the challenge of creating a new business model
We will explore potential business development in promoting DX solutions and areas related to lighting that utilize such solutions to make such opportunities the driver of our new business growth.
- Build a new space control system by combining SmartLEDZ with other products, services, and technologies.
- Develop new lighting design software and raise the sophistication of lighting planning by utilizing an app to analyze perceived brightness.
3. Improving productivity in terms of both quality and quantity
We will improve our efficiency and profitability by thoroughly eliminating losses and improving QCD by promoting management based on scientific methods.
- Ensure the safety and enhance the reliability of products by introducing new inspections as well as new testing and evaluation methods.
- Introduce a production management system and a traceability system that links plants in Japan with overseas plants.
Lighting Fixtures Business - UK
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1. Increasing our share in the electrical equipment materials wholesale market in the UK and building a stable foundation
We will maintain a leading share in the UK wholesale market by improving customer loyalty and our position by further enhancing our customer service, which is one of our strengths.
- Collaborate with wholesalers to enter the property business.
- Enhance our delivery capabilities by restructuring our inventory management system.
2. Dramatic growth in new business areas
We will reinforce our resources and structure to aim for further growth in the DIY business under the "4Lite" brand and the overseas business centered on continental Europe.
- Develop new sales channels, such as online distribution and retail distribution (DIY business).
- Reinforce the structure of our business foundation in new markets (regions), including our inventory supply and customer service in Spain (overseas business).
Lighting Fixtures Business - Asia
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1. Brand penetration in strategic markets
We will strengthen our branding and establish our position with "sync," our original brand in Asia for high-end architecture, and "Synca (SmartLEDZ)," our next-generation dimming and color control series, which has already been launched in Japan.
- Propose a packaged solution combined with other control systems utilizing Synca DALI Repeater.
- Offer interactive showrooms to provide opportunities to experience our solutions.
Environment-related Business
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1. Expanding our remote control business
We will consecutively launch new services while positioning "Rental Plus," which adds a remote/integrated lighting control feature to our rental services, as the core solution.
- Integrated control of and failure detection for a single or multiple stores
- Energy-saving services, maintenance services, and sales-promotion-type services
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2.Creating new value-added products and services
We will meet new customer demand and increase customer loyalty by developing energy-saving, energy-creating solution products and new business models.
- Enhance our product lineups for flexible solar panels and perishable foods.
- Increase the scale of contracted jobs by obtaining a special construction business license.
Numerical Targets [Net Sales by Segment]
Action to Implement Management That Is Conscious of the Cost of Capital and Stock Price
Activities to Improve Our Capital Efficiency
Our PBR has been hovering below 1.0.
During the period of this Medium-term Management Plan, we will generate profit by realizing steady business growth and enhance activities to improve capital efficiency while focusing on enhancing our consolidated profitability and inventory optimization (enhancing SCM and improving the accuracy of PSI planning) as key issues to address.
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Activities to improve capital efficiency
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Enhancing consolidated profitability
- Increase revenues by developing and producing products on our own that were previously purchased from suppliers outside the group.
- Design common value-added processed parts in a way that can be used in common among various products and produce them in-house.
- Optimize the product portfolio of the two overseas plants and reinforce their production systems.
- Reinforce technological and R&D capabilities and promote streamlining of products at each manufacturing hub.
- Reinforce the quality control system (introduce AI-based image inspection and the use of robots in production).
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Optimizing inventory
- Build a system to order products based on an analysis of information on sales, received orders, and inventory.
- Improve the accuracy of and automate ordering operations by processing demand- and supply-related data with AI.
- Manage parts that require a longer time for delivery based on future demand forecast data.
- Shorten the production lead times of the plants of our group and major subcontractors.
- Shorten lead times by and build a system for maintaining safety stock
- Reduce losses by handling semi-custom products at manufacturing plants.
- Build a system to order products based on an analysis of information on sales, received orders, and inventory.
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Cash Allocation
We strive to strengthen our business profitability by focusing not only on investment centered on production capacity but on investment for business growth in each region and field.
Our Policy on Shareholder Returns
Regarding shareholder returns, we strive to stably and continuously increase dividend amounts while aiming for a consolidated dividend payout ratio of around 30%.
We will consider dividend amounts in line with the progress of our growth investment over the medium- to long-term and how the business is performing in the given fiscal year.
Strengthening Our Business Foundation
The Business Foundation We Aim to Establish
To contribute to society through the value provided by our ethical solutions, we strive to make the most of the management capital that generates such solutions.
To establish the business foundation that we are pursuing, we will enhance our capabilities through the following activities.
1.Enhancing profitability
In preparation for the possibility that profitability will worsen due to changes in the uncertain external environment, we will eliminate waste by reviewing our operational processes in a timely manner and increasing efficiency by utilizing digital technologies and aim for a lean management structure.
- Integrated management of our internal knowledge and utilization of data
- Raising the sophistication of our digital marketing and digital promotions
- Increasing the efficiency of operations for receiving orders and preparing lighting plans (B2B / automated proposal system)
2.Human resources to create solutions
We will update our systems and make active investments in order to strengthen our efforts to develop human resources and organizations that will create new lighting solutions that will serve as the core driver of our business growth.
- Offering career paths and an autonomous learning environment to enable our employees to realize their career plans autonomously
- Actively investing in the next generation of our core human resources
- Developing an organizational climate that leads to improved employee engagement
3.High-value-added products and services
We will continue to create high-value-added products that will revitalize the market by developing a mechanism by which the development, manufacturing, and sales departments collaborate with each other to sustainably generate innovation and accurately understand customer needs.
- Building a structure that enables the development, manufacturing, and sales departments to collaborate with each other in product development
(speedy launch of new products under dedicated project structures for specific market areas) - Promoting collaboration with various types of business
4.Developing a mechanism for sustainability management
We will promote sustainability management as a group by establishing an appropriate management structure, educating and informing internal and external parties, and addressing issues and making efforts to achieve goals on a company-wide basis.
- Formulating and steadily executing a plan to reduce greenhouse gas emissions
- Updating specifications to use energy-saving materials and processes
- Developing a strong governance structure
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- Management Policy
- Medium-term Management Plan
