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«About Japan » Webinar Series:

Plastics Products & Components

Silke BROMANN

Dr. Silke Bromann Japan Consulting• o

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Dr. Silke BROMANN

• Research and teaching on Japanese economy & enterprises since 1998

• Dr. Silke Bromann Japan Consulting founded 2011

• Research, analysis & consulting on markets and economy in Japan

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Table of Content

• The market for plastic products & components• The characteristics of Japanese supplier

networks• Opportunities & challenges for European

companies• Strategies for success

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Products covered in this report

• Plastics in non-primary forms, e.g. plastics sheets or films

• Household items & construction materials made of plastic

• Packaging• Automotive and machine parts

made of plastic

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Plastics in non-primary forms• Japan is the fifth-largest producer of plastics in the world

with an overall production volume of 12 million tons• Total production value in Japan ca. 2,900 bn Yen (2012)• Setback after Lehman shock, path towards recovery• Trends: health and environmental concerns, sustainability

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Use of plastics in Japan (2010)

Source: Japan Plastics Industry Federation (2013): Shuyōkoku no shijōbetsu purasuchikku shiyō wariai 2010 (Percentages by user market in the main industrial countries, 2010), Internet: http://www.jpif.gr.jp/5topics/topics.htm

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Household items & construction materials

• Household items: • Market volume 314 bn Yen• Health issues, Quality labels

• Construction materials: • Usage of plastics in construction higher than in other

industrial countries• Legal issues, standards, Quality labels

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Packaging

• Market volume 1,600 bn Yen• Trends: shrinking package sizes,

convenience food, environmental and health concerns

• Regulations concerning food packaging, labelling & recycling

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Automotive parts

• Different demand trends in Japanese and overseas markets

• General trends:– E-Mobility– Lightweighting– Environmental issues

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Japanese production of plastic parts for transport machinery, in billion yen

Source: Ministry of Economy, Trade and Industry (2013): Paper, printing, plastics products and rubber products statistics, Tokyo: Ministry of Economy, Trade and Industry, Internet: http://www.meti.go.jp/statistics/tyo/seidou/result/ichiran/08_seidou.html

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Parts for machinery

• Electric & electronic devices: fluctuating demand, price competition

• Medical equipment: growth trend, regulations

• Other machinery: positive trend in construction site equipment

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Japanese supplier networks

OEM manufacturers (automobile manufacturers)

First-tier suppliers(components such as dashboards, seats, wiring)

Second-tier suppliers(parts and subassembly of components)

Lower tier suppliers(parts, parts processing, standard parts)

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Japanese supplier networks

• Production keiretsu• Qualitative bonds in the keiretsu relationship

– Long-term relationship– Cooperation in product development– Dispatch of managers

• Trend of lessening bonds• Less rigid structure in sectors other than automotive• Trend: more independent supplier SMEs: jisha seihin

(independent product development), new distribution channels (other sectors, other materials)

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Opportunities for European companies

• Niche products, USP• New materials & technologies• Globalisation of supply chains

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Challenges for European companies

• High expectations regarding quality & service• keiretsu networks• Differences in standards and consumers’

preferences• Especially for components: harsh competition

in terms of cost-effectiveness and innovation

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Strategies for success

• Innovation, Quality & Service• Nurturing of contacts • Long-term commitment• Cooperation with Japanese partners

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Many Thanks!

Silke BROMANN

Dr. Silke Bromann Japan Consulting

www.bromann-japanconsulting.de