There are no insurmountable obstacles to trading with Japan. However there are numerous factors, some unique to Japan, that might be considered obstacles, but that can, with appropriate research and subsequent clarification and understanding, be overcome. Consider the following:
Without widespread use of English in Japan, it should never be presumed a Japanese person can speak English, or is comfortable doing so. It’s sensible to ascertain this beforehand. All usual documentation in Japan is in Japanese. As a consequence, interpreting and translating services may be required at any stage in business dealings. An effort to pick up a few useful words and expressions will be appreciated by the locals as a sign of genuineness, and contribute to bonhomie if socialising occurs.
Japan isn’t a Western country, yet nor is it completely Asian. Consequently it’s easy for visitors to feel unfamiliar about any one of a number of everyday aspects of life, and to be unsure about whether a certain product or service is suited to the market, or will gain acceptance there. It’s for this reason this publication emphasises the importance of learning about the country as a preparatory step to doing business with it, including the essential ingredient of undertaking product research.
3. Finding customers
The hardest thing about doing business in Japan is finding customers. At the retail level, most shops, except small local ones, have ties to distributors or suppliers, and many refuse to even look at a new product offered by an outsider.
This often necessitates the use of an established distributor or wholesaler, who has an existing network of retail outlets it sells to, and who’s agreeable to taking on a new product, or who’s looking for something new and believes a particular product may attract attention.
The word keiretsu refers to a grouping of firms, usually comprising a major industrial company, and a variety of smaller companies that act as its suppliers, commonly located nearby. A bank may also be a group member, or otherwise the group will have a close relationship with a bank, and the large or parent company will have a financial interest in each of the smaller group companies. If a company an exporter wants to supply to is in one of these groups, that may also be an obstacle, although not necessarily insurmountable, and once business commences with one member of the group, trading opportunities might arise with others. This topic is covered further in the section on ‘Japan’s employment system.’