Sanrio was established by Shintaro Tsuji as the Yamanashi Silk Company in 1960. In 1962, Tsuji expanded his enterprise from silk to rubber sandals with flowers painted on them. Tsuji noted the profits gained by just adding an attractive design to the slippers and hired illustrators to design cute characters for his merchandise in reply. In 1973 the company was officially organized under the title "Sanrio." The company's website says the name comes from the Spanish words san (holy) and río (river.) The book Korea Sanrio no Himitsu Desu or This is the Sanrio Company Secret gives another origin of the name. According to this, Tsuji, Sanrio's founder, said that Yamanashi, part of the company's former name, has an alternative to Yomi reading of sane. The remaining "o" added from the ou sound people make when they are excited.
The company designed a line of character merchandise around gift-giving moments. Hello Kitty was added to the list of early Sanrio characters in 1974, and the first related merchandise was released the following year. The favorite mouthless feline has had both peaks and drops in sales over the years but always has been the highest grantor to Sanrio's sales. Other notably beloved characters through the years have been The Little Twin Stars (created by Mr. Tsuji himself), My Melody, Keroppi, Badtz-Maru, Tuxedo Sam, Chococat, Cinnamoroll, Sugarbunnies, Jewelpet and Wish me mell. Sanrio regularly adds new characters to its lineup. Particular types are exchanged in and out of active production. For a short time, Osamu Tezuka's baby unicorn character Unico, who starred in two feature-length anime movies in the early 1980s, was also part of the Sanrio empire; however, the rights to Unico shifted to Osamu Tezuka's company after Tezuka's death in 1989.