In a recent development, a Toyota subsidiary, Toyota Customizing & Development (TCD), was found to have violated Japan’s laws protecting subcontractors. The Fair Trade Commission (FTC) revealed that TCD had dozens of suppliers store items without paying storage fees and forced 65 suppliers to accept returns on allegedly defective products without proper inspection.
This violation comes at a time when the Japanese government is pushing for better treatment of small companies, who often have little bargaining power when dealing with larger clients. The total costs of these violations amounted to ¥54 million ($336,100), which TCD has since reimbursed to its suppliers. Additionally, the company will also pay back storage costs to those affected by their actions.
This incident sheds light on the challenges faced by subcontractors and highlights the importance of fair treatment and adherence to laws governing business practices. It serves as a reminder for companies to prioritize ethical conduct and proper business practices in all dealings with their suppliers.