Its electronic gadgetry is gathering dust on the shelves of high street stores, nobody is buying new fridges and the mountain of unsold plasma televisions is growing by the day.
However, in desperation, Panasonic has hit on the perfect counter-attack against the consumer slump: it has ordered every member of staff to go out and buy £1,000 of Panasonic products.
Large swathes of corporate Japan are expected to follow suit, either by directly commanding or indirectly “pressuring” employees to divert part of their salaries towards the goods that their employers produce.
Toyota has already tacitly applauded a “voluntary” scheme in which 2,200 of its top brass decided to buy new Toyota cars, and the president of Fujitsu recently e-mailed 100,000 staff and gently pointed out how nice it would be if “employee ownership rates” of Fujitsu PCs and mobile phones were a little higher.
The 10,000 Japanese staff affected by Panasonic’s unorthodox strategy do not have long to consider their purchases.
Management insists that staff buy their Panasonic goods – whether they need them or not – by the end of July.
Upper-level managers, all of whom have been “encouraged” for years to fill their homes with Panasonic goods as a symbol of corporate loyalty, are being asked to spend at least 200,000 yen (£1,500).
A Panasonic spokesman said that because the “Buy Panasonic” request was made to management-level employees, the company did not expect refusal rates to be high.
The emergency directive, some Panasonic employees say, is a particularly cruel blow: the same 10,000 managers now being commanded to fork out for unwanted electronics were told two weeks ago that their salaries and bonuses would also be slashed.
The company itself is staring down the barrel of one of its worst annual earnings performances ever, with a Y350 billion flood of red ink expected by the end of the year.
Panasonic said that the move, which is not unprecedented in company history, was aimed at forcing management to “recognise the severity of the current business environment” – a recognition that might have been expected to be in place already, Mitsubishi Tokyo UFJ brokers said.
Only a fortnight ago the company announced plans to close 20 per cent of its factories and cut 15,000 jobs from its global workforce.
Other warning signs from that announcement included pay cuts of between 10 per cent and 20 per cent for directors and 5 per cent for managers.
Even if other Japanese companies are less overtly aggressive about forcing staff to buy their products, many are expecting the Japanese corporate tradition of socially enforced loyalty to kick in and force the issue anyway.
Companies such as Sony and Sharp hold regular discount sales of goods for employees, and sources at both companies have suggested that the most recent events have involved a “clear sense of pressure” to be seen supporting the company by buying its products.
The “Buy Fujitsu” campaign involved an e-mail from the president that read: “If everyone in the company gets together, then it will become a great power.”
February 13, 2009
Leo Lewis, Asia Business Correspondent
Source: Times Online