This article discusses the management practice and performance of parts suppliers in the auto industry in the Chugoku region. We sent the questionnaire to 285 supplier firms and received 66 responses. We further conducted the questionnaire survey to above respondents and finally analyzed 49 suppliers. The results show that parts suppliers have neither expanded customers nor diversified products in the past five years. Among factors such as strategy, competitors, and industry structure, there are two critical factors affecting suppliers' business activities: a) trading practices and b) resource accumulation. Stable life-cycle of products as well as longer and interdependent relations with customer firms provide suppliers with incentives to accumulate specific resources and capabilities to particular customers or manufacturing processes. Although customerspecific resources and capabilities bring some advantages in the existing business, they constrain suppliers' ability to develop new business. The research suggests that strong strategic leadership is necessary for supplier firms to overcome resource constraints and to develop new business horizons.