Startup Period1832 – 1916Laying the Foundations for a Specialized Trading Company — From dyes to chemicals

Founding of Urokogataya

On June 18, 1832 in Nishijin, Kyoto, 27-year old Denbei Nagase founded Urokogataya, a dyestuffs wholesale business that handled safflower, funori seaweed and starches. Japan's economy had hit rock-bottom around this time, and the country was in disarray, plagued not only by famine but epidemics, frequent popular uprisings, and urban riots. As founder of Urokogataya, Denbei undoubtedly faced considerable hardships in keeping the business afloat.

Establishment of the Osaka Office and Relocation of the Head Office

Around the middle of the Meiji era (1868-1912), after Japan had opened its doors to foreign trade, textile manufacturers began to replace natural safflower and indigo with artificial dyes from overseas. With imports of artificial dyes flourishing, Nagase was also quick to begin handling these products, which boosted its profits.
Once Nagase began handling imported artificial dyes, Denzaburo strongly believed that establishing a presence in the commercial hub of Osaka was necessary for the future development of the business. On August 17, 1893, Nagase established its first branch office in Osaka.
Advertisements in the first issue of a periodical on dyestuffs issued by Nagase helped spread awareness of the products it handled at the time. In August 1894, a year after Nagase opened its office in Osaka, the Sino-Japanese war broke out. Japan's quick victory in the eight-month conflict brought on an economic boom, and Nagase's Osaka branch office also prospered. In November 1898, Nagase moved its head office to Osaka and established a sales office in Kyoto.

Opening of Lyon Office and Direct Trade with Ciba

Trade in Osaka at the time was almost exclusively controlled by foreign trading houses in Kobe. Denzaburo saw direct trading as a key to the future of the business. In February 1900, he sent his younger brother, Denjiro, to Europe. Denjiro attended a commercial school in Lyon, France, where he researched the silk industry. Subsequently, he conducted on-site research at the Society of Chemical Industry in Basel.* In September 1901, he established and became manager of Nagase's Lyon office. Nagase thus became one of the first Japanese companies to look overseas for business growth, and to send employees to work abroad.

*Society of Chemical Industry in Basle (abbreviated as Ciba, which became its official name in 1945)

Nagase had been importing dyestuffs from Ciba through Siber Hegner & Co., Ltd., but business expanded greatly after the Lyon office opened. Nagase's path to becoming a trading company specializing in chemicals really began here. The impetus for Nagase's significant advancement in the Meiji era came when it began handling Ciba's Pyrocin sulfur dye.
In November 1910, future Nagase president Tokutaro Nagase was assigned to head the Lyon office. He conducted negotiations to switch to direct trading with Ciba, and eventually succeeded in making Nagase Ciba's distributor in Japan. Thereafter, the Lyon office played the central role in Nagase's direct trade with Europe until the opening of the London office in April 1913.

Opening of Tokyo Branch Office

In April 1908, the Tokyo sales office was established in Koamicho in the Nihonbashi district of Tokyo to expand Nagase's domestic sales channels. It was renamed the Tokyo branch office when it moved to Kobunacho, Nihonbashi in July 1911. The main product handled by the Tokyo branch office at the time was sulfur dye. It also handled logwood extract, Marseilles soap, sodium peroxide, sodium sulfide and zinc powder.

Expansion of Overseas Bases

Overseas, the Lyon office initially served as Nagase's business base in Europe, but after business finally started to expand, Nagase opened another office in the more geographically convenient London in April 1913. This office was combined with the Lyon office in September that year, and the New York office was established in November 1915. Nagase also vigorously advanced into China and other Asian markets.