Operational profits of Japan’s exporters and large manufacturers improved due to weaker JPY

JPY has boosted overseas repatriated profits. While the weak JPY may have inflated import costs at SMEs, lower global energy prices likely offset this impact to some extent. 

SMEs with direct overseas investment may even have benefited from a weaker JPY on converting overseas earnings to the local currency. 

18.9% of manufacturing SMEs or 13.4% of all SMEs owned overseas subsidiaries in FY11 and this trend is rising, according to the latest SME White Paper by the Ministry of Economy, Trade and Industry. 

SMEs operating as sub-contractors or vendors for large manufacturers should be able to negotiate better contract prices, given rising profits at the large companies due to a weak JPY.