Japan Remains a Key Market for International Business
The Tokyo Stock Exchange (TSE) is the largest stock exchange in Asia, with more than 3,700 companies listed and a combined market cap greater than $ 5.6 trillion (as of December 2020).
Japan is the world’s third largest economy after the US and China and second largest computer and telecommunications market in the world.
The Japanese market is characterised by consumers with high levels of disposable income who are drawn to premium, high-end goods and services.
Japanese companies often exhibit a global outlook and a willingness to invest long-term in viable products and services.
Japan is synonymous with quality and innovation and this goes hand-in-hand with Japanese companies’ commitment and loyalty to business partners. Furthermore, for many foreign companies, Japan has also become the place for development of new products and concepts.
Advantages of Doing Business in Japan
There are strategic advantages and cost advantages in doing business in Japan. It is possible to set up a business entity in Japan in just 14 days and successful business in Japan can generate a significant proportion of global profits within 3 – 5 years. Use of JETRO’s One-Stop Business Establishment Center services can cut the time required to establish a business in Japan down to 4 days.
Japan has a highly developed, modern infrastructure of roads, highways, railroads, subways, airports, harbours, warehouses and telecommunications for the distribution of all types of goods and services.
Japan has over 20 ports and 5 international airports. Tokyo International Airport (HND) and Narita International Airport (NRT) are the two major airports in the Tokyo region while Osaka International Airport (ITM) and Kansai International Airport (KIX) are the two major airports serving the Osaka region of Japan. Japan’s ports, airports and import processing are generally well organised and efficient.
If you succeed in Japan, you can succeed anywhere as it means you have developed a product or a service that has met the high expectations of the discerning Japanese market that has extremely high standards for quality.
But Isn’t Japan a Challenging Market to Break Into?
International companies may be concerned about Japan’s complicated distribution channels, a high concentration of domestic competitors and Japan’s unique business culture.
However, thanks to the internet, a lack of physical geographical boundaries means it’s easier to reach customers in Japan than ever before.
In addition, global payment gateways and mobile payment solutions offer convenient ways to receive funds in different currencies.
While Japan does have a well established domestic market in many sectors, there is an exoticness and status associated with Western brands that drives Japanese consumer demand for Western products and services.
Moreover, Japan’s business culture isn’t as challenging as many businesses believe. Patience, integrity, respect for their business customs and a long term view to business success are the main ingredients to succeed in Japan.
Questions about doing business in Japan?