doing business in japan
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1
Doing Business in Japan
WHAT DO YOU NEED TO KNOW BEFORE ENTERING THE JAPANESE MARKET?
BY MITCH TOMIZAWA
2Map of Japan
3Cherry blossoms nowstarting late March every year
New business starts in April. Spring starts with cherry blossom
New academic year start in April.
New graduates start working for companies and government
Individual income tax returns due March
Many Japanese listed companies close its fiscal year at end of March
On April 1, people still take things seriously.
4Tokyo Metropolitan train
systemMost convenient and punctual in city life
5Tokyo subway system
They say 179 stations exist
6
Japan Country Statistics
Name: Official name of the country is JAPAN
As united small islands of 6,852, of which people lives
only on 437 islands (6.7%) with no residents in the remaining 6,415 islands.
Population: 126 MM (rapidly aging population)
100 years ago the Japanese population was around 30 million. It grew by four times to the peak of 127,840,0000 in 2004. It is estimated to return to the level of 100 years ago in 2100.
7
GDP Comparison
Ranking: 1. US 16,244.58 (@US$1 bil) 2013 figures (nominal)
2. China 8,221.02 (1/2 is investment)
3. Japan 5,960.27 * (60% is individual consumption)
*Equal to the sum of India, Aus. Korea, Indonesia and Taiwan. Additionally
25,263 Japanese companies doing business in 136 countries employing over 5MM staff.
4. Germany 3,429.52
5. France 2,613.94
6. UK 2,476.67
8
Two business approaches
1. Do business with Japanese customers in Japan
Products- price sensitive (cheap)/insensitive (expensive)
Volume driven/ quality driven
Over 3000 international companies doing business in Japan
TPP negotiation will influence company strategy significantly especially for price elastic products.
2. Do business with J companies globally.
take advantage of local opportunities to start business with J companies.
J expats most appreciate local invaluable business support, and never forgets.
In both cases, find the right and most qualified Japanese leader for your new operation. You need to select the right person for the job, or nothing happens.
9Statistics: I Companies in Japan
2,875 I companies
employing 510,000 staffFROM WHERE #employed
From Europe 44% 270,547
From US 27%210,042
From Asia 22% 29,993
OWNERSHIP:
100% ownership69%
50%<X<100% 17%
50% 6%
1/3<X<50% 7%
INDUSTRY:
Wholesaler43.5%
Manufacturing17.7%
Services12.7%
ICT10.1%
Financial 4.6%
Retail 4.2%
10# of J companies active offshore(more than 25, 000 companies)
# of J companies and Name of Country where J companies have operations
6,091 (24%) -------- China 2,276 (13%) ------ US
1,853 (7%) ------- Thailand 1,220 (5%) ------ Hong Kong
1,111(4%) ----- Singapore 989 (4%) -----Taiwan
862 (3%) ----- Indonesia 847 (3%) -----UK
829 (3%) ----- Malaysia 815 (3%) -----Korea
11Top 5 countries where J companies started operation in 2009 – 2012(est.)
2009 2010 2011 2012(est.)
1.China China China China
2.US India India Indonesia
3.Vietnam US Thailand Thailand
4.Thailand Thailand US US
12
You should know first
Japan Business groups:
Japanese business is still along the so called relationship driven business. It will take a bit longer than you might imagine but once established it will last long based on trust between parties.
Toyota: 23 cos with diverse industries; Panasonics: 4;Hitachi: 12;Sony:12;
Seven & I group: 23;NTT group: 10;Mitsui: 25;Sumitomo: 34;Mitsubishi: 39
Group companies share information to strengthen business ties.
JETRO (Japan External Trade Organization) can help.
13
Epilogue JAPAN AND NOW
14You know where you are heading for before riding on it.
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