japan marketing and trade for hawaii companies · 2017-02-27 · certified trade advisor –well...

Japan Marketing and Trade for Hawaii companies

Hideki Yamane

Economic Development Specialist

Market Development Branch

Exporting to Japan Market 1

Table of contents


1. Market Overview

2. Threats & Opportunities

3. Distribution Channels

4. Import Regulations

5. Pricing Strategy

6. Marketing Strategies

7. References

8. Our Services & Roles

9. Markets We Cover (Local/National/Global)

10. Seal of Quality Program

11. Made in Hawaii with Aloha

12. Export Assistance

13. Upcoming Events

My background..

• Worked for Australian Government in Japan for 15 years to help Australian agribusiness entering Japanese market and attracted Japanese investment into Australia.

• JETRO (Japan External Trade Organization) Certified Trade Advisor – well versed with Japanese market, mode of market entry, regulations, distribution channels and have contacts with Japanese importers and investors.


• The third largest economy in the world and boasts a high buying power

• One of the world’s most import dependent markets, currently importing 60% of its food supply, worth US$ 44 billion

• An attractive and vast market for international food suppliers to serve the retail, food service and manufacturing industries

• An economic leader in Asia and having long experience in standard business practice, Japan can be seen as the first step to expansion across the Asian region

Market Overview (1)


• Food industry is one of the recession proof industries

• Hawaii food products are widely used/sold in Japan

• Hawaii products go to every corner of Japan, from convenience stores in a small village of Okinawa to an upscale restaurant in the heart of Tokyo.

Market Overview (2)


Market Overview (3)


Look for Blue Ocean – niche market!High-end market pays $37 per one mango fruit and

$5,000 for a 1kg of manuka honey from Australia.

• Sales tax has increased from 5% to 8% in 2015 which held back people from dining at upscale restaurants.

• 1/4 of population is 65 years or older

• More demand for clean & green fruits and vegetables, lean meat and seafood. Hawaii’s capability meets this demand

• More and more demand for nutraceutical and functional foods (anti-oxidant, low GI, anti-aging etc)

• Japanese functional food/ health food market is worth $23 billion and Health food market alone is worth $15 billion

Threat & Opportunities


Importer

Import Distributor

Importer

Import Retailer

Expo

rter

Co

nsu

mer

Import DistributorD

istribu

tor

Retailer

Sup

plier

Distribution Channel (1)


Brokers (nakaoroshi)

Retailers, restaurants, processors

Overseas producers

Importers Processors

WholesalersPrimary wholesalers (oroshi)

Buyers (nakagai-nin)

Consumers

Wholesale market (eg Tsukiji)

50% profit

30% profit

50% profit

Distribution Channel (2)


PASSED NOT PASSED

Custom Clearance (taxed) Ship-back or disposal

Domestic Distribution

Live Animals Meat, Ham, Sausages etc

Fruits and vegetables,Grains, beans, etc

Fishery products

Processed foods,Beverages, tableware,

Toys for infants, additivesFood packages

Animal QuarantineInspection by MAFF(Domestic Animal Infectious Disease

Control Law)

Plant QuarantineInspection by MAFF

(Plant Protection Law)

Sanitary Inspection by Ministry of Health, Labour and Welfare, Quarantine Station(Food Sanitation Law)

Import Regulations (1)


Compliances to Japanese regulations and laws is entirely the responsibility of importer but the Hawaii exporter should assist the importer by submitting necessary information for smoother custom clearance (3 docs - commercial invoice, list of ingredients, production flow chart).

Basically there are two side regulations & laws governing imported foodstuffs. Exporters should be aware of this structure.

1. Regulations at time of Importation(Plant Protection Law, Animal Quarantine Inspection law etc)

2. Regulations at time of Domestic Sale(Food Sanitation Law, PL law etc)

Import Regulations (2)


Pricing Strategy (1)Price Escalation

- Add costs on top of a product


Cost of Product (FOB)

Freight & Insurance (CIF)

Custom clearance and tariff

Cost of inland delivery

Importer cost & mark-ups

Distributor cost & mark-ups

Retailer cost & mark-ups

$10in Hawaii

$30in Japan

High-end products = Higher mark-upsLow sales frequency. Would you pay $30 for a small bag of coffee?

Price Breakdown-Deduction from local target retail price

$7in Hawaii

$21in Japan

Set target overseas retail price. Deduct costs to decide ideal FOB price. You might want to make package smaller.

Pricing Strategy (2)


FOB = Price of GoodsC&F = FOB + FreightCIF = C&F + Insurance

• Distribution channel

• Exclusive or non-exclusive, agent or distributor

• Labels, compliance to regulations – entirely the importer’s responsibility

• Price Structure (Cost Breakdown vs Cost Plus)

• Mind primary sales seasons. Oshogatsu, Spring, Ochugen, Oseibo, Christmas

• Communication (be prompt and be honest)

• Do your homework (desktop research)!

• Understand the buying criteria – uniqueness (tell your product story), product benefits, safety and compliances to regulations

• Develop products with unique originality, reasons why Japanese want to buy your products

Marketing Strategy (1)


Hawaii companies should be aware of several key factors affecting food purchase trends in Japan. These factors are;

• rapidly aging population

• diversification of eating habits

• emphasis on high quality

• increasing demand for convenience

• food safety concerns



• One of the key objectives in your market entry strategy is to establish an importer/agency relationship.

• Whilst the downturn in the Japanese economy has introduced some changes in the Japanese distribution system, with some opportunities for direct sales to final outlets, typically, the distribution system still involves an importer/agent who distributes through a layered network of primary and secondary wholesalers and eventually, retailers.

• The importer/agent provides financing and warehousing facilities, and markets the product in Japan on your behalf.



• In selecting an import agent or business partner, it is important to understand the typical distribution system in Japan for your particular product.

• Because of the changes in the supply chain, we also recommend that you talk to as many end-users of your product as possible in order to ascertain the potential demand for your product in Japan.

• In many cases, if the end-users are interested in your product, they will ask the importers to import on their behalf.



MARKET

US Dept of Commerce: Country Commercial Guide – Japan

http://www.buyusa.gov/japan/en/ccg.html

FINDING BUYERS

JETRO Business Matching Database (TTPP)

http://www.jetro.go.jp/ttppoas/index.html

STANDARDS & REGULATIONS/ TAX

JETRO Guide to Standards and Regulations

http://www.jetro.go.jp/en/reports/regulations/

IMPORT DUTY (Ministry of Finance)

http://www.customs.go.jp/english/tariff/2010/index.htm

References and Data


http://www.buyusa.gov/japan/en/ccg.html

http://www.jetro.go.jp/ttppoas/index.html

http://www.jetro.go.jp/en/reports/regulations/

http://www.customs.go.jp/english/tariff/2010/index.htm

Help farmers find revenue• Develop markets (local, national, international)

• Provide statistics and market data

• Trade Opportunities (trade shows, seminars)

• Business matching (inbound/ outbound missions)


HDOA MDB Services & Roles

Local

Global

Domestic

Markets we cover…


Local Market

• Question: How much food is imported to Hawaii?


85%

1. Increase local production and food security.

2. Keep our money and jobs in Hawaii.

3. Buy Local It Matters call to action.

Global Market• Question: How much percent

of food and beverage is consumed in the world outside of North America?


83 %

• Hawaii:1.3 million people

• World: 7.1 billion people

• Big opportunity in global market!

• Best when processed – logistics, shelf

life, branding

Source: Euromonitor International 2013

Population

Hawaii North America

Export Assistance (1)• We work with Western United States

Agricultural Trade Association (WUSATA)

• We help agribusinesses explore, enter and expand into the global market place

• Up to 50% reimbursement of global marketing expense


Export Assistance (2)• Export is not difficult – find experienced importers!

• Arrange one-on-one meetings with buyers

• Advice on global market and contacts

• Market information (USDA, Euromonitor)

• Trade shows – local, national, international


• “Seal of Quality” Branding Program

• Hawaii-grown or Hawaii-made premium products, a guarantee that is enforced by the State of Hawaii (over 51% Hawaii ingredients).

• Asian market loves official credential. Application is available today!

Seal of Quality Program


Made in Hawaii with Aloha Program

• Differentiate Hawaii products from products made

elsewhere yet called Made in Hawaii

• 51% or more cost must be incurred in the state

• Registration is Free

• www.hdoa.Hawaii.gov/madewithaloha26

http://www.hdoa.hawaii.gov/madewithaloha

• Gulf Food in Dubai* (February)

• Taiwan Inbound Buyers Mission to Maui* (March)

• Foodex tradeshow in Tokyo (March)

• HOFEX tradeshow in Hong Kong* (May)

• Int’l Food & Ingredients Expo in Tokyo (May)

• Canada Produce Inbound Buyers Mission* (June)

• Canada Retail Inbound Buyers Mission* (July)

• Japan Inbound Buyers Mission* (July)

• Korea Inbound Buyers Mission* (TBD)

• Hawaii Lodging, Hospitality & Foodservice Expo (July 12-13)

• ASEAN Inbound Buyers Mission* (August)

• Made in Hawaii Festival (August)

• PMA Fresh Summit New Orleans (October)

* WUSATA activity

Upcoming events 2017

27

Mahalo & Arigato!


Market Development [email protected]

808-973-9595

mailto:[email protected]

japan marketing and trade for hawaii companies · 2017-02-27 · certified trade advisor –well...

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