keiretsu

At the wedding, you notice how the same faces keep showing up everywhere. The uncle who supplied the drinks also owns the generator company that powered the hall, and his brother in law printed the aso ebi, and the bank that gave the couple their loan is the same bank the caterer uses. Nobody planned it on paper, but everybody in that circle helps everybody else stay in business, and money moves round and round inside the family without ever really leaving it.

Keiretsu is that same idea, grown into a business structure, and it comes from Japan. It describes a cluster of companies, often a bank, a manufacturer, a supplier and a distributor, that own small shares in each other and trade with each other first before looking outside. Toyota's keiretsu includes the steel makers who supply its metal, the parts makers who supply its brakes and engines, and a bank that lends to all of them, all calmly loyal to one another.

There is no single owner sitting at the top giving orders. Instead there is a web of relationships, cross shareholdings and long standing trust, built over decades, that makes the whole group behave like one organism even though each company is legally separate.

In Nigeria, you see softer versions of this among some conglomerates, where a group might own the bank that finances it, the logistics company that moves its goods, and the manufacturer that makes its products, all under one umbrella of trust and shared interest. A Nigerian founder in London studying Japanese business models might borrow the idea on a smaller scale, partnering closely with one loyal supplier and one loyal financier instead of shopping around every time.

The strength of a keiretsu is loyalty and steady supply, because everyone inside the circle protects everyone else, especially in hard times. The weakness is that it can shut out fresh competition and cheaper outside options, because the group prefers to trade with its own even when someone outside might offer a better deal.