#Japan #Tokyo #Funai Consulting #Business Succession #Pachinko Industry

Funai Consulting Starts M&A and Succession Planning Series

Funai Consulting, known for its expertise in business advisory, has recently launched a dedicated video series aimed at guiding leaders in the Pachinko and Pachislot industry on the intricacies of Mergers and Acquisitions (M&A) and business succession. This initiative is not just timely but critical, considering the rapid changes and challenges facing this sector.

The first video, released on August 28, dives into the perplexing scenario where profitable Pachinko halls struggle to find buyers. Experts from Funai Consulting explain that potential acquirers often look beyond immediate profits. They assess whether a business has the capability to sustain itself over the next 10 or 20 years. This long-term perspective often leads to challenges in finding suitable buyers, even for businesses that are currently in the black.

Focused Expertise for a Niche Market

The series is led by Norimichi Okuno, an expert with nearly three decades of experience in the Pachinko industry. His extensive knowledge enables him to tackle the specific complexities that come with business operations in this field. He highlights the current situation in the industry: with the number of Pachinko halls declining from over 10,000 to around 6,000, business dynamics are shifting. Figures that once drove profit, such as the investment in new gaming machines, are now merely expenses necessary to keep the doors open.

One key takeaway from the initial episode is the critical importance of understanding the future value of a business rather than its current profitability. Okuno emphasizes that a company might be generating profit today but could fail to attract buyers if the market perceives it as unsustainable in the long run. Conversely, some businesses generating losses could still be viewed favorably if they present potential for future profitability through reinvestment.

Insights from Real Market Experiences

The video series also sheds light on practical market experiences and statistics — for every 10 consultations regarding business sales, typically only 1 to 2 result in a successful transaction, even with strategic adjustments resulting in as many as 3 to 4 closings. Specific examples discussed include how adjusting rental agreements or finding alternative uses for properties can make a business significantly more attractive to buyers.

For instance, if a Pachinko hall can negotiate a decrease in rent from 5 million yen to 3 million yen, it could become appealing to potential buyers looking for profitable ventures. Creative solutions, such as leasing land to third parties or repurposing the business for other industries, were also discussed as viable strategies.

The Importance of Tailored Guidance

The rationale for focusing on the Pachinko industry is clear: tailored advice is more effective. While general M&A principles apply universally, the specific execution can dramatically differ from one industry to another. Funai Consulting’s unique position allows them to offer insights without needing to explain basic operational aspects to their clients, as they are deeply familiar with the industry's nuances.

With a team of over 1,000 consultants in more than 180 sectors, Funai Consulting is well-equipped to facilitate these important conversations. Their status as a leader in this industry is evidenced by accolades like the M&A Professional Award 2025 for individual transaction volume.

Future Developments and Recommendations

Looking ahead, Funai Consulting plans to continue producing educational content tailored for the Pachinko industry. Upcoming topics will cover valuation strategies, the rise of corporate sales, and evolving market trends. Importantly, Okuno cautions business owners against rushing into premature sales and advises regular assessments of their business’s value, similar to a health check-up. Staying informed about their firm’s market positioning can empower owners to make better decisions regarding the timing of their eventual sale.

To explore the insights shared by Funai Consulting, you can watch the first episode of the series here, and find additional resources on their official YouTube channel.

About Funai Consulting

Funai Consulting, formed through a joint venture between the renowned Funai Group and Agata Global Management Group, offers comprehensive advisory services across M&A, succession planning, and due diligence related to financial and operational aspects for various industries.

For more information, visit their official website here.