Doing Business in Japan
Japanese demand a very high standard of quality, and once
they lose confidence in something it is not likely to be
regained. Japanese follow strict rules of etiquette. The
exchange of business cards is mandatory. It is also regarded
as an important and solemn gesture, so cards should be presented
rather formally, received with due respect and examined
carefully.
It is social custom to give small gifts to business and
social acquaintances, and careful attention should be paid
to the status of the recipient. With titles in polite conversation
it is better to use the suffix "san" rather than Mr, Mrs
or Ms (ie Suzuki-san rather than Mr Suzuki).
Agents/Distributors - Finding a Partner
Establishing a direct presence in Japan is the best way
to penetrate the Japanese market, but can be a prohibitively
expensive strategy to launch. The use of agents/distributors
is a more realistic marketing strategy for small/medium
companies, but this approach requires great care in the
selection of the representative.
Distributors in Japan usually cover a specific territory
or industry. Import agents are often appointed as sole agents
for the entire country (although there is no statutory requirement
that this be done). While in some cases exclusivity may
be necessary to ensure a strong commitment by the Japanese
agent towards expanding sales, an exportershould not be
pressured into handing over control of the whole market
if there is doubt as to the ability or willingness of the
Japanese company to develop the entire market. Regional
exclusivity, a limited term of representation, minimum sales,
or qualitative indicators of sales efforts may be recommended
in exclusive agency contracts.
While the Japanese Fair Trade Commission has guidelines
applicable to exclusive agency contracts, there are no statutory
damages required upon termination of an agency contract.
However, replacing a Japanese agent or distributor is difficult
in Japan if not handled extremely sensitively given the
close-knit nature of business circles and the traditional
wariness of foreign suppliers.
Selling Factors/Techniques
Personal contact with customers is very important. A visiting
company representative or resident agent in Japan should
accompany a Japanese agent or distributor on visits to existing
-- or potential -- Japanese customers. Making sales calls
demonstrates commitment to the market and is also an excellent
way to obtain market feedback.
Too many business relationships sour after a successful
honeymoon period. A common mistake made by U.S. companies
in Japan is failure to provide adequate support for their
Japanese business partner after initial successes. It is
generally important to prevent a distributor from implementing
a conservative, low-volume, high-markup marketing strategy
that will protect their own interests while leaving the
U.S. product's full sales potential badly undeveloped.
Part of selling in Japan is knowing how to negotiate and
maintain relationships with Japanese. Japanese language
skills can be invaluable, as can a thorough background in
Japanese culture and etiquette. It is important to be honest
and direct, while avoiding appearing overbearing.
Initial contacts between Japanese firms are usually formal
and made at the executive level, while more detailed negotiations
are often carried out at the working level. Typically, the
first meeting is to get acquainted, establish the broad
interest of the calling party and allow both sides an opportunity
to "size each other up." A series of meetings with a large
number of Japanese company representatives is common. Business
negotiations may proceed slowly, as the Japanese side may
prefer no agreement over being criticized later for making
a mistake.
While many Japanese business executives speak some English,
a skilled and well-briefed interpreter, while expensive,
often prevents communication problems. Though some firms
do business in Japan without a signed contract, written
contracts have become a universally accepted practice in
Japan: they satisfy tax, customs and other legal requirements.
Japanese companies prefer short, general contracts, while
normally companies prefer to spell out rights and obligations
in detail. A contract should be viewed as part of a greater
effort to create an understanding of mutual obligations
and expectations, rather than a tool in case of a lawsuit.
Business Hours
- Mon-Fri 10am - 5pm,
Sat 10am - 12pm.
- Shops; 10am - 6pm
(many are closed Wed. or Thurs.)
Some Useful Sources of Information
Markets and Sectors
http://tradeport.org/ts/countries/japan/sectors.html
Market Access
http://www.tradeport.org/ts/countries/japan/market.html
http://www.jetro.go.jp/Distribution/index.html
http://www.aexp.com/smallbusiness/resources/expanding/global/reports/11135020.shtml
Investment climate
http://www.tradeport.org/ts/countries/japan/climate.html
Other Sources of information
Japan External Trade Organization (JETRO)
http://www.jetro.go.jp/top/index.html
JETRO Business Support Center (BSC)
http://www.jetro.go.jp/ip/e/bsc/index.html
To assist foreign business people in launching their marketing
efforts in Japan, JETRO operates Business Support Centers
in Tokyo, Yokohama, Nagoya, Osaka, Kobe, and Fukuoka. In
addition to providing free office space, the centers are
staffed with advisors who provide complementary consulting
services on exporting to Japan and doing business there.
Services
* offer know-how on market strategies, import procedures,
characteristics of specific markets, etc.
* provide advice on avoiding or solving problems that overseas
business people may face in Japan
* compile lists of business contacts and assist with making
appointments
The Ministry of Foreign Affairs, Japan
The Ministry of Foreign Affairs provides you with various
official Japanese information, including foreign policies,
visa information and friendship. Whenever you want official
information about Japan,
http://www.mofa.go.jp/
Japan Information Network
This site has been set up by the Japan Center for Intercultural
Communications (JCIC) and offers all kinds of information
about the society, culture, education and other aspects
of Japan. This web site has been made possible with the
cooperation of the Ministry of Foreign Affairs of Japan.
Catch up on the latest domestic information about Japan
from
this site !
http://jin.jcic.or.jp/index.jp.html
CommerceNet Japan - A non-profit organization cooperating
with CommerceNet, USA
http://www.commercenet.or.jp/english/index.html
The Promotion of Foreign Direct Investment and Imports
to Japan
http://www.keidanren.or.jp/english/policy/pol023.html
Guidelines of Procurement Policies
http://www.keidanren.or.jp/english/policy/pol024.html
The Survey on Actual Conditions Regarding Access to Japan
http://www.jetro.go.jp/ip/e/access/index.html
Procedure for Foreign Trade
http://www.wtco.osakawtc.or.jp/faz/procedures/index.html
Market Information on Osaka Foreign Access Zone
http://www.wtco.osakawtc.or.jp/faz/minfo/index.html
Japanese Survey Data Bank (repository of public opinion
surveys)
http://www.ropercenter.uconn.edu/jpsdb.htm
Access to Japan - Provides contact points for major Japanese
companies
http://www.keidanren.or.jp/A2J/
