The purpose of this publication is to assist businesses make their product (or service) available for sale in Japan, or assist them establish a business there. To achieve this objective, knowledge of the market segment targetted is essential, but familiarity with a broad range of topics relating to Japan will also be useful and helpful, if not also essential. This publication cannot provide product or market segment specific assistance, but it does provide information about a wide range of issues relevant to any attempt at product placement in Japan.
Intended primarily for small to medium-sized businesses, it’s a guide aimed at individuals who want to become directly and personally involved in trading and doing business with Japan. Reading through this document will assist you to learn more about the country, which in turn will assist you in your business endeavours there.
The mention of Japan conjures up many images. From the past and still continuing, kimono-clad women, Geisha, sumo and rice paddies. From more recent decades a plethora of cutting edge consumer products and brand names. For businesses contemplating Japan as an export market, other images might be import restrictions and non-tariff barriers, difficulties of distribution, closed markets, unusual packaging styles, different sizes, lack of knowledge about products the Japanese like, unfamiliarity with Japanese business practices, language obstacles, and more. A land of opportunity, but also of unknowns and uncertainty.
Japan is different from other countries, both Western and Asian, as it is neither completely Asian nor largely Western. The Japanese themselves consider they’re neither wholly Asian nor Western, but rather, Japanese. Japan comprises a somewhat complex mix of many external influences – trends, habits, customs, ways of thinking – superimposed on its own unique, centuries-old history and culture. These influences, integral to modern Japanese society and culture, were imported from mainly China and Korea up to the mid-19th Century, and from the West since.
Over time these influences have been modified to suit and fit in with Japanese tastes and preferences, in some instances becoming unrecognisable from the original. This process of bringing in and adapting things from the outside is continuing, whether they be cultural or commercial. It’s a long-time practice, and shows the Japanese are receptive to external ideas, influences and products, so long as they fit in with or suit their own way (such as in size, style, taste), or can be made to do so.
A first impression of Japan can be that it appears little different from other industrialised nations. The cities are modern, with fast, efficient transportation systems, busy streets full of the latest cars, trendy restaurants and shops, recognisable brands, current fashions familiar around the world. Yet, socially, historically and culturally the country is different, a fact prospective exporters must keep in mind.
The key point is that to develop a successful business relationship with Japan, it’s essential to absorb, appreciate and accept these differences, and in the process gain a good understanding of the people and the country, with particular emphasis on the market segment you want to enter.
Because of these differences, misconceptions and false impressions have accompanied the idea of doing business with Japan. Most of these can be set aside at the outset. Consider the following:
- Japan is not excessively expensive, either to live in or operate a business in. Prices were high in the 1980s and into the 90s, but continuing asset deflation has brought many prices down and halted the upward trend of others.
- similarly salaries aren’t excessive compared to the West, and in many instances (such as senior executives and employees paid by the hour) lower.
- consequently, the cost of doing business, such as staff, office rental, distribution, shouldn’t be a deterrent to considering entering the Japanese market.
- if after due diligence a product is found to be suited to Japan, and a good understanding of the country and this product segment can be acquired, there’s no reason why other countries should be considered before Japan, even as the company’s first export market.
The Japanese way
There are a few basic but essential concepts to be aware of at the outset about doing business with Japan:
- the standard of quality and finish of any item or product presented to Japan must be as good as any in the world, if not the best, and this level of quality must be maintained.
- Japanese business people want to operate within the context of long-term relationships, that will inevitably develop into friendships. If you can show yourself to be a person with a genuine interest in trading with Japan, and your product is right or can be adapted, you’ll have already made a good start. Once a relationship has been developed, the Japanese partner will show a strong sense of loyalty and stick with the supplier, so long as the supplier continues to fully play its part, on reliability of delivery and maintaining quality levels, even if price might become less competitive.
- to know and understand Japan for business purposes requires a knowledge not just of its marketplace and product mix, but a deeper understanding and awareness of its culture, history, society and people, topics all covered here. Such knowledge will make any person who’s serious about a successful entry to the Japanese market better placed to achieve the goals they set for their endeavours there.