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Business trends

Corporate Japan's cost-sales ratio hits lowest since 2000

Restructuring after 2008 financial crisis paved way

TOKYO -- Japanese companies' costs in proportion to sales are at their lowest this century thanks to restructuring and cheaper materials, enabling them to achieve profit growth even if revenue falls.

At nonfinancial listed firms closing their books in March, costs of goods sold plus selling, general and administrative expenses accounted for 90% of sales in fiscal 2016, the lowest since 2000, when companies fully adopted consolidated corporate accounting. That share has been steadily declining since the year ended March 2012. The peak came in fiscal 2008, when the figure reached 96%.

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