No Time Like Now to Look for Opportunities
There is no time like now for finding business opportunities in Japan. The country is preparing for the Rugby World Cup next year and the Olympics and Para-Olympics the following. Before investing foreign investors must understand the markets to avoid some of the pitfalls that other businessmen have come up against in Japan. Even some of the world’s largest organisations such as Vodafone have failed to make a success here.
There are a lot of regulations, procedures, and permissions that are required to enter some of the industries in Japan, and you’d be well advised to make use of a lawyer or management consultant to assist you. Unlike other Asian countries the many forms that require completion are in Japanese and not in English, so unless you speak fluent Japanese you’ll need help in interpreting them. Having a Japanese partner or staff member can also help you to negotiate some of the bureaucratic pitfalls of doing business in Japan.
Businessmen entering the Japanese economy should understand the workings of the Keiretsu as traditional loyalties run deep
Understand Your Customer
Japanese customers can be very demanding, and the product requirements can differ substantially from those found in western markets, so western businesses must understand the demands of the Japanese customer. One of the reasons why Vodafone failed is that their cell phones did not appeal to the Japanese public, who chose to deal with the competitors, whose cell phones they preferred. Japanese people tend to prefer local brands. To succeed your business must be tailored to the market. The brand from website to product offering must reflect Japanese preferences.
Know the Competition
Opportunities are one thing but understanding the market before you invest is of prime importance. Establish a plan of action to compete in these markets before you setup a company.
There are many strong Japanese companies doing business in Japan, and they will develop strategies to keep their market share and keep your business out. Unless you have done your market-research and understand the competition and the pitfalls that you face you could put your business at risk.
In Japan, industries have for a long time been grouped into Keiretsu. These are informal groups of businesses that invest in one another and form loyal bonds. There were once six of these industry groups each with a financial conglomerate at the centre. Although this has somewhat reduced over recent years, businessmen entering the Japanese economy should understand the workings of the Keiretsu as traditional loyalties run deep and many businesses in a Keiretsu will only buy from a business in its own Keiretsu.
Management skill requirements in Japan can be very different from the management skills that are required to succeed in a western country and many companies fail to adapt to the changed environment.
Business relationships are also very different in Japan than in other parts of the world and forming these relationships is very important
Etiquette is also important in Japan and you would be well advised to understand some of the basic etiquette surrounding meetings, greetings, exchanging of gifts, acceptable business attire, cultivating trust and negotiations in Japan. At the start of your journey into the Japanese business world, it could pay to have a Japanese interpreter who can also assist you with the cultural issues.
Win or Lose
It is said that businesses starting up in Japan can either win big or lose big, given that this large market often requires large investments and carries considerable risk. Understanding the customers, the competitors and the culture could help your business to become one of the big winners.