This is the first of a series of journal posts that will walk you through some of the basics on how to expand your SME* into Japan.

Whether you are in the fashion business or own a tech company, before expanding into Japan, you will need to do similar groundwork.

It is likely your sales team proposed expanding into Japan. Japan has a population of 127 million people, and it is the world’s third largest economy. The market potential is huge for most companies—but getting access to it is the tricky part!

Many great places can help you get into Japan, including the Ministry of Foreign Affairs, JETRO, business organizations etc. but, without making a plan from the beginning, they might not be able to help. However, what kind of plan do you need?

The first advice is to get a good look at your company’s history and philosophy. You need to understand where you come from, and what you want to be in the future. This is a frequently asked question in Japan.
In addition, these spheres need the founder or CEO’s involvement. Japan has a history of a hierarchical management structure, which means you need the founder or CEO in the front row.
It is important to understand that building relationships and trust with a potential Japanese business partner is crucial. Getting into the Japanese business market without local knowledge and partnerships will be next to impossible.
In Denmark, focus on making the deal and then build a relationship. In Japan, you will need to gain trust before you can sign a contract with e.g. a distributor.

Really, it is just like dating. No one really likes to hear a guy brag about how much money he earns, or how great he thinks he is on the first date. Be humble and focus on the reasons you established the company and your philosophies.

Seek advice on what cultural differences can affect you and your company, and how and what you need to communicate to attract a Japanese business partner.

There is a huge unfulfilled potential for Danish SME’s in Japan, but until now, many of them saw Japan as intimidating because of the significant cultural differences. Nevertheless, it is critical to realize Japan craves the Danish lifestyle, design, and knowledge.

Yours sincerely,

Ole Takai

 

* Small and medium-sized enterprises