KINGDOM OF CAMBODIANATION RELIGION KING

Build Bright University

“Doing Business in Japan”

International Management

TOPIC

Lecturer: Dr. Balakrishnan V M

Group : D21Prepared by : Bo Vibol

Beang Neariraoth Ly Pheakdey Sok Rado Y Enane

Academic Year: 2012-2013

Content

1- Introduction

2- Japan Country Profile

3- Key Words

4- Political and Legal System

5- Japan Market Challenge

- Japan market overview

- Ease of doing business in Japan

6- Economic Environment in Japan

7- Business Structure

8- Factors Should be focused:

9- Conclusion

10- References

1. Introduction

Doing business is like leading a troop to battle against one country. Thus, it requires a lot in order to be able to be successful in doing a business. There are so many ways/tactics and/or strategies in order to own a business in one country, especially in Japan.

Japan is the largest market outside the United States—larger than those of Germany and France combined, and almost three times that of the UK. Yet it is generally believed that Japan is the most difficult place to do business among the industrialized nations. In spite of this, many companies have been successful in Japan, and many more can be. It does require the discipline to execute well—Japan can extract a high price from those that don't. 1

2. Japan Country Profile

Official name: Japan Location: East Asia continent

has a total of 6,852 islands with total land area 377,727 sq km.

Population: around 127,368,088 with density 335sq km – Average 2.5 house whole.

L/E: Men = 80 yrs vs W = 87 yrs.

Adult literacy: 99% Nominal GDP 2013: 5,867,154

M-USD

3. Key Words

Global market: is the exchange of goods and services between countries. This type of trade gives rise to a world economy, in which prices, or supply and demand, affect and are affected by global events. Ex: Political change in Asia, for example, could result in an increase in the cost of labor, thereby increasing the manufacturing costs for an American sneaker company based in Malaysia, which would then result in an increase in the price that you have to pay to buy the tennis shoes at your local mall.

Business: Any commercial, industrial or professional activity undertaken by an individual or a group.

Competition advantage: An advantage that a firm has over its competitors, allowing it to generate greater sales or margins and/or retain more customers than its competition. There can be many types of competitive advantages including the firm's cost structure, product offerings, distribution network and customer support.

Market: A set up where two or more parties engage in exchange of goods, services and information is called a market. Ideally a market is a place where two or more parties are involved in buying and selling.

Key Words Con’t

There are 7 type of market: 1. Physical Markets, 2. Non-Physical Markets, 3.

Auction Market, 4. Market for Intermediate Goods, 5. Knowledge Market, 6.

Financial Market, 7. Black Market.

Price: A value that will purchase a finite quantity, weight, or other measure of a

good or service. As the consideration given in exchange for transfer of ownership,

price forms the essential basis of commercial transactions. It may be fixed by a

contract, left to be determined by an agreed upon formula at a future date, or

discovered or negotiated during the course of dealings between the parties

involved.

Culture: the behaviors and beliefs characteristic of a particular social, ethnic, or

age group: the youth culture; the drug culture.

4. Political and Legal System

Japan is a parliamentary monarchy governed by a Prime Minister and his cabinet. The Emperor lost most of his official power after WWII. The bicameral parliament is called the Diet and is composed of the upper House of Councillors (Sangi-in) and the lower House of Representatives (Shugi-in).

Japan’s legal system has a US style Supreme Court appointed by the cabinet. The Supreme Court presides over a legal system of lesser courtsdivided into four arms: High Courts, District Courts, Family Courts and Summary Courts

5. Japan Market Challenge The difficulty of penetrating the Japanese market depends to a great

extent on the product or service involved. Key variables include the degree of local or third country competition, the number of regulatory hurdles to be overcome, and cultural factors such as language (both spoken and written), strict service and quality expectations, and business practices.

Generally, tariffs on most imported goods into Japan are low. However, cultural, regulatory, or other non-tariff barriers continue to exist that can impede or delay the importation of foreign products into Japan. These can include Japanese import license requirements, restricted or prohibited imports, temporary entry of goods, certifications, standards, labeling requirements, etc.

5.1. Japan Market Overview

This page summarizes Doing Business 2013 data for Japan. The first table

lists the overall "Ease of Doing Business" rank (out of 185 economies) and

the rankings by each topic. It also lists the economy's distance to frontier

(DTF)** measure. The rest of the tables summarize the key indicators for

each topic and benchmark against regional and high-income economy

(OECD) averages.

Description Rank

Ease of Doing Business Rank ▲ 24

Starting a Business 114

Dealing with Construction Permits 72

Getting Electricity 27

Registering Property 64

Getting Credit 23

Protecting Investors 19

Paying Taxes 127

Trading Across Borders 19

Enforcing Contracts 35

Resolving 1

5.2. Ease of Doing Business Rank

6. Japan Market Overview Con’t

Main Export:

1. Capital equipment

2. Industrial supplies

3. Consumer durable goods

Country of partners:

- China 19%

- USA 16%

- South Korea 8%

- Hong Kong 6%

6. Japan Market Overview Con’t

Main Import: - Consumer Goods 16.3%- Food 10.9%- Fuels 20.3%- Industrial Supplies 22.6%- Machinery 23.8%- Transportation 4.5%- Other 1.6%

Country of partners: - China 22%- USA 11%- Australia 6%- Saudi Arabia 5%

6. Economic Environment in Japan

- In’t economic crisis in 2008 was a little bit hit Japan economic who was the 2nd world economic leader.

- In 2008 were: -1.2% of growth and in 2009 -5.2%, mainly due to a decline of the economic

activity in the United States (its 1 trade partner), in Europe (which attracts 15% of the total

exports from the country) and in Asia (mostly in China).

- Moreover, the price rise in energy and food products has contributed to the drop of the

domestic demand. - Supported by the dynamism of the Chinese economy, Japan's growth, estimated at 2.8%,

has rebounded in 2010, stimulated by exports as well as the resurgence of private consumption.

- The perspectives for 2011 were less optimistic due to the slowdown in exports and a less favorable business climate. The earthquake that hit Japan on March 11, 2011 and the tsunami that followed led to a more negative review of these estimates. The cost of the disaster is expected to exceed 300 billion USD, not to mention the significant concerns regarding the nuclear power plant in Fukushima, whose consequences are not yet well known. According to experts, the Japanese economy should not recover before 2012.

Economic Review in Japan Con’t

Main Indicators 2009 2010 2011 2012 2013

GDP (billions USD) 5,032.98 5,458.87 5,821.95e 5,920.56 6,058.06

GDP (Constant Prices, Annual % Change)

-6.3 3.9e 1.4e 2.1 1.7e

GDP per Capita (USD) 39,459 42,820 45,659e 46,507e 47,679

General Government Balance (in % of GDP)

-7.0e -7.5e -8.3 -7.4e -7.3e

Inflation Rate (%) -1.4 -0.7 0.2 0.2 0.4

Unemployment Rate (% of the Labor Force)

5.1 5.1e 4.9 4.7 4.5

Current Account (billions USD) 141.66e 149.73e 131.05e 116.94 -

Current Account (in % of GDP) 2.8 2.8 2.4 2.1 -Source: IMF - World Economic Outlook Database

7. Business Structure

Representative Office

Brach Office

Subsidiary Office

Limited Liability Partnership ( LLP )

Type of Business Structure in Japan

The main business structures by which foreign companies generally establish a

business presence in JAPAN are :

8. Factors Should be focused

Hence to be successful in doing business in Japan, we should take

strong notice to the following 6 stages:

1. Connect Customer Needs Tightly to Your Home Office Staff

2. Great Visibility Essential for Great Support

3. Take a Proactive Role in Sales and Marketing

4. Be a Superb Listener

5. Get the Pricing Right

6. Provide Excellent Training to Japanese Staff

9. Conclusion

Japan is an enormous market, one of the world largest in term of economic scale.

Japan’s industries are globally competitive and as can be seen in the automotive sector.

Japan is the one country among East Asian which has market grows rapidly, because the economic integration between countries in region continue to strengthen.

Government Policies can make the foreign investors strongly confident to indulge in Japan market.

10. References

Internet and Publications:1. http://www.htm.co.jp/Bsixsteps.htm

2. http://data.worldbank.org/data-catalog/GDP-ranking-table

3. http://www.indexmundi.com/japan/population.html

4. United Nations World Population Prospects, 2006 revision. UN. Table A 17

5. UN Statistics Division. 1 April 2010

6. World Factbook: Japan". CIA.

7. "World Population Prospects". UN Department of Economic and Social Affairs. Archived from the original

on 21 March 2007

8. http://www.globaltrade.net/f/business/Japan/Business-Environment.html

9. IMF - World Economic Outlook Database

10. http://www.investopedia.com/terms/b/business.asp

11. http://www.investopedia.com/articles/03/112503.asp

12. http://www.managementstudyguide.com/what-is-market.htm

13. http://www.worldbusinessculture.com/Business-Facts-and-Figures-on-Japan.html