EVERYTHING YOU WANTED TO KNOW ABOUT BUSINESS WITH JAPAN, FIRST HAND

Features of business in Japan. Photo: pexels.com Statistics show that a large number of entrepreneurs from Russia are striving to open a business abroad. One of the most popular places for this is Japan. It is not easy to establish business relationships with local businessmen due to the oversaturation of the market, but everything is possible if you follow certain instructions.

This article will analyze instructions for starting a business in Japan, significant nuances and key features of this topic, provide valuable recommendations for implementation, and analyze possible difficulties along the way and ways to overcome them.

Negotiations and mentality

When establishing business with Japan, it is important to note that negotiations for citizens of this country play a special role in establishing a new enterprise. It's no secret that the Japanese themselves are a rather closed nation. Negotiations do not make decisions. This is just a way to get the necessary information about the company, its capabilities, potential and competitiveness in the market.

The Russian entrepreneur will not receive an answer during the negotiations itself, but if the eastern partners start asking about the details of the project, this is a good sign. This means they were really interested in establishing a business relationship with a foreigner.

Here you need to properly position yourself before the Japanese. It is necessary to carefully prepare before starting such negotiations, since many questions will have to be answered, and avoiding details of the case for the Japanese will be tantamount to refusal.

Communication between boss and subordinate

In Japanese organizations it is not customary to give orders the way we do. If you look from the outside at how the manager and his subordinate communicate with each other, you might think that these are not instructions, but only advice and recommendations. In fact, the Japanese do not need to set strict conditions and speak with all the “sternness of a boss” for them to understand what is wanted from them. Just a hint in the form of a recommendation is enough - and they will complete the task accurately and on time.

This is based not only on the fact that the Japanese are efficient and diligent. They know that they simply cannot fail to complete the task, since everyone is subordinate to the existing hierarchy, which mainly depends on length of service in a given company. Even a one year difference makes a huge difference.

Difficulties for foreigners

The very different mentality of the country makes itself felt even when opening a company. To start a successful commercial activity, you need to understand several nuances that relate to doing business by non-residents:

• The incredibly high level of quality of domestic goods and services is the main pride of all Japanese. Another feature of their mentality is strict adherence to and control over production. It will be difficult for a foreign businessman to maintain the proper level of quality alongside the Japanese offer;
• Japan has always been distinguished by its apathy towards visitors. Here it is very difficult to gain even a little trust among the local population and commercial partners. Knowledge of the language and culture of a country is not an indicator. The decisive factor will be the benefit for the state and its citizens from the partnership with the enterprise;
• To conduct business, an intermediary with Japanese citizenship is required. It is advisable to find a business partner. Finding such a person is quite difficult, but this will make the process of doing business several times easier. The best solution is to enlist both intermediaries and partners in the country;
• The Japanese are distinguished by their particular seriousness, including when it comes to commerce. The foreigner's project must meet all necessary criteria. You must understand all the intricacies of your own business and be able to familiarize your partners with the details of the project. A clearly developed business plan and its impeccable understanding increases the chances of a positive outcome in negotiations.

Shoes that breathe

In the land of the rising sun, work culture has a much greater influence than here. Thus, one of its components is the dress code, established by almost every company. And in most cases it means closed shoes. It doesn’t matter what the weather is like outside, but you won’t be able to come in sandals. Shoe manufacturers have come to the aid of suffering office workers working all day in stuffy rooms.

Thus, an innovative shoe brand, Hydro-Tech, was released. It allowed me to feel comfortable throughout the day, because my feet did not sweat in it.

It should be noted that not only Japanese companies are thinking about comfortable shoes for people who, willy-nilly, are always obliged to wear a strict uniform. So, perhaps you have come across the Italian brand Geox. But it was the Japanese who managed to release their copy at an affordable price. The Italians made their shoes much more expensive.

The company's secret was the access of air and its circulation in the boots due to small ventilation holes, which, like a spider's web, entangled the multi-layer sole. Also included was an insole with antibacterial coating and orthopedic functions.

However, such shoes were only suitable for dry weather and flat surfaces. Alas, the development process has not yet reached the level where such boots would provide protection against the ingress of gravel or sand and other small particles that would disrupt circulation. But as an option for office wear, the shoes were just perfect.

The cost of a pair of shoes varied. The average price tag was about 2300 rubles.

The Russian market is not saturated with such goods. However, breathable shoes will definitely find a certain audience. A much larger number of office workers will enjoy wearing breathable shoes of this design rather than those with perforations on the toe surface.

Features of doing business in Japan

Like every country, Japan has its own nuances when opening and running a new business. Let's look at the main features that distinguish the country from others:

1. Transparency of legislation and infrastructure;
2. Japan has an unusually low crime rate, including the number of corrupt officials;
3. Antimonopoly legislation prevents large enterprises from ousting small businesses from the market, providing them with favorable conditions for development;
4. There are incentives that are available for starting a new business venture. They allow you to get discounts on the purchase of necessary equipment at the start;
5. It is possible to open a business in Japan without capital. But one of the conditions is to notify the economic bureau and collect the necessary capital within 5 years.
6. The main risk factor is the illegal activities of the entrepreneur and non-compliance with the country’s legal system.

4d amusement park

In 2011, the Live Park entertainment center opened in Korea in a new 4D format, which consists of interactive attractions, holograms, 3D avatars mixed with live actors, original installations and unsurpassed visual effects. The park's area of ​​10 thousand m² is divided into 7 entertainment zones, in which technological equipment and attractions are located. Capacity – 3 thousand people. The park developer, D'strict, is planning to open interactive parks in other countries; they are always happy to have potential partners.

Business etiquette in Japan

Due to many years of isolation, the mentality of the country is very different from the European one. This also applies to business etiquette. When opening a business in Japan, it is important for a Russian businessman to carefully familiarize himself with the rules and traditions of Japanese business relations, such as:

1. Punctuality. You should arrive on time for all business meetings and negotiations. This is the key to a successful reputation, since no excuses or justifications will correct a damaged image in the eyes of the Japanese.
2. Hierarchy. You need to give due respect to your superior partners. The person with the highest status among those present deserves the most honor. Compliance with this rule involves not only appropriate treatment and greeting, but also facial expressions and gestures.
3. Greetings. In Japan, it is not customary to shake hands when meeting. The same is not done in negotiations with opponents and partners. To make the right impression and show respect, you need to bow.
4. Business cards. Everything here is very complicated and incomprehensible to foreigners. Business cards in Japan are issued only with the right hand or with both hands at once. Accepted with both hands. Otherwise, failure to follow these rules will show your disrespect in the eyes of the Japanese. Don't pass business cards across the table.
5. Don't rush to conclusions. During negotiations, remain calm and do not resort to harsh statements and conclusions. Many things that are strange to us during negotiations are perceived by the Japanese in a completely different way. Don't jump to conclusions and humbly wait for an appropriate reaction from them.
6. Expectation. The Japanese can seriously irritate a Russian businessman with their slowness in making any business decisions. You need to be patient and wait for an answer. If you insist on making an immediate decision, the Japanese will perceive this as arrogance and disrespect.

Collectivist values

The Japanese place the interests of the group above the interests of one individual. If in countries where individualism rules (for example, in the United States of America), people tend to draw attention to their personal achievements and skills, then in Japan they are much more focused on the achievements of the team. The Japanese will never say: “I achieved this,” they will say: “My team, my team achieved this.” Therefore, when entering Japanese society, you should not brag too much about your personal awards or successes - this will be somewhat strange for the Japanese.

In companies, all important decisions are made based on the opinions of all group members. Before holding a formal meeting, each team member must express his point of view. Then there is a rather lengthy process called “namawashi” - this is preparation for the final decision-making, and it consists in forming a single opinion, taking into account the points of view of all participants in the meeting. Directly at the meeting itself, no one expresses any ideas or objections, since the decision, as a rule, has already been made. It is announced, and then there is a discussion of further actions taking into account the decision made.

If we are talking about any kind of rivalry between several companies (competition, tender, etc.), then for the Japanese the most important thing is not even victory, but that they act and make decisions together.

How to open a new business in Japan

One of the best countries in the world in terms of living standards, Japan, attracts foreigners, including businessmen. The country's closed policy will not allow you to easily enter the country, much less obtain a visa.

Obtaining a business visa

To obtain a visa, you need to collect a package of documents that need to be submitted to the Japanese consulate in your country, namely:

• Foreign passport (valid for six months after return);
• Copies of all pages of the internal passport;
• Completed forms (check which forms will be required at the visa department);
• Two color photographs (the face should be clearly visible in them);
• Certificate of income from the previous place of work indicating the position and salary;
• An invitation from a resident of Japan, which specifies the terms and purposes of the visit to the country.

Choosing a form of enterprise and registering it

To register an enterprise, you need to submit a registration certificate (certified by a seal) to the registration authorities at your place of residence. You can handle all the paperwork yourself, but it is better to hire a qualified specialist who is familiar with the legal nuances of establishing a company.

Business in Japan provides for three organizational and legal forms of running a company:

• Limited Liability Company;
• Joint-Stock Company;
• Opening a subsidiary branch;

The minimum starting capital of an enterprise should be 3 million yen - about 2 million rubles. The subsidiary does not require capital investment at all.

Tokyo city

Tokyo is the capital of Japan and also a metropolis, home to approximately 13 million people. If we consider Tokyo and its suburbs together, then in terms of its economic scale this formation is the largest in the world and surpasses even New York and its surroundings.

Most Japanese and foreign firms in Japan have established their head offices in Tokyo. In addition, this city ranks fifth in the world in terms of financial sector development.

In addition to the system for issuing startup visas, the Tokyo authorities have prepared various programs to support foreign companies, in particular there is an Entrepreneurship Support Center, which takes care of some of the formalities and helps to correctly draw up the necessary documents, as well as an accelerator for foreign startups.

As for the accelerator, many large Japanese companies with head offices in Tokyo have already acted as partners of the program, so it can be used as a place for networking and finding business partners. Currently there are 3 separate programs for the areas of Fintech, Newtech and Blockchain.

Small Business Development in Japan

The country's economy is focused on small businesses in Japan. This is explained by the rather small number of state-owned enterprises, which is why it is small commercial entities that have a special impact on the economic well-being of the country and its competitiveness.

Any legal entity, including a foreigner, has the right to establish its own company in the country. There is no need to obtain a special permit or work visa. Sometimes you don’t even need to be present in Japan.

Purchasing an existing business

Buying an existing business in Japan is actually not that difficult, but there are a few nuances that are worth thinking about. Firstly, selling a company to a foreigner for a Japanese on a psychological level is equal to a mortal sin. But if he has already decided to do this, do not rush to fill out the documents, it is better to take an interest and find out what is wrong with the company and why it is being sold.

Sales announcements for companies are published in Japanese local periodicals. But a more appropriate solution would be to contact a brokerage company.

If you decide to purchase, remember that the current owner must provide documents indicating that the company has no debts or problems with the law. Otherwise, you may encounter unforeseen situations in the future.

Once you have ensured that your documents are in order and are still planning a purchase, it is recommended that you contact a local lawyer who knows the country’s legislation well. It is quite difficult for a Russian person to figure out on his own what is what in Japanese laws, and sometimes it is simply impossible.

Profitable business ideas in Japan

The most popular among foreigners is the opening of restaurants and cafes. In addition, some business ideas from Japan can confuse a Russian businessman with their unusual nature. This type of business is in great demand both among tourists and the local population. Let's look at the main ideas for business in Japan:

1. Capsule hotels. This is almost a national treasure of the Japanese. Such hostels are in great demand among the local population. The business does not require large investments and is quite simple to organize. Such hotels can be located near an office district, a city center or a complex with slot machines.
2. Public catering. Cafes that sell delicious goods will be of interest not only to the Japanese, but also to visiting tourists. Potato hot dogs or roll chips sell well from the shelves. You can also open a restaurant with unusual ideas or serving dishes. Casual restaurants, themed cafes, and unique bars have become very popular lately.
3. Gas stations and parking lots. There are many cars in Japan, but little territory. Ceiling-mounted gas stations are very common. Often there are automated parking lots with several tiers, which allows you to save more space. Such a business will not only be profitable, but also very popular among the Japanese themselves.
4. Modern technologies. One of the most technologically developed countries is interested in the development of this area. If your company develops the latest technologies (for example, robotics) or uses them in production, this can bring good income.

Divorce Japanese style

We often come across statistics on marriages and subsequent divorces in reports and news reports. But only in Japan, they decided to turn the problem of the increased number of couples wanting to end their legal relationships into a profitable business.

As we know, in the USA, a personal psychologist is called upon to solve the internal problems of spouses; in Russia, his place is taken by friends and relatives who will listen to the person’s complaints and support him with kind words. But in Japan, the people themselves are not verbose, unlike Western countries. And everyone wants to share their experiences. This is the idea of ​​one Japanese businessman named Hiroki Terai, a former merchant and now a businessman.

He organized an opportunity for divorcing couples to pour out all their worries on paper in the form of a newspaper article, or appeal. Moreover, a newspaper published with such materials is delivered to pre-agreed recipients. What those getting divorced get is a chance to express their emotions in writing and avoid long-term regrets and questions from the outside. Indeed, in such an article you can not only report the fact of divorce, but describe all the ins and outs, the reasons and processes that led to this event.

A newspaper can be a very profitable business. So for the founder of this business, the client pays about $140 per page, plus another 60 if it has photos. Thus, a circulation of five dozen copies can already bring almost 10,000.

In Russia, the idea is, in principle, feasible. And this is connected not so much with a reluctance to listen to endless consolations, but with our person’s general love for “gossip.” Most likely, when organizing a startup, you will have to supplement it, recalculate possible price tags and select a specific audience, but with the right approach, profit will not be long in coming.

How to buy and sell a business in Japan

Buying or selling an existing business in Japan will not be particularly difficult. But there are certain factors and nuances. At the level of mentality, selling a company to a foreign citizen is not typical for the Japanese.

If you managed to convince the owner, then when purchasing you need to make sure that all the necessary documents are available. It is important to ask why exactly the company is being sold, since this is a rather unusual decision for the local population.

Pros and cons of the deal:

• One of the highest gross domestic product in the world market and a stable economy;
• Wide opportunities for qualified specialists;
• High level of ensuring public order and legality by government agencies;
• Possibility of choosing favorable climatic conditions for running an enterprise. The climate in Japan varies depending on the area.

Hotels for the deceased

Let's move on from renting a room for young girls to a more exotic idea. In general, everything related to business based on services for relatives who have left us is gradually penetrating all markets. And now we are not talking about simple funeral services. In the wide range of offers you can even find coffins for pets. Therefore, one should no longer be surprised at such an idea as a hotel for the dead. But let's figure out how such a business could even appear.

The idea came from Japan. The fact is that on the islands the issue of overpopulation is more pressing than ever. The high mortality rate of the elderly population is also approaching. And, sad as it may be, crematoria do not always cope with the load. And citizens have to decide where to keep the body of the deceased until his funeral.

This is where the relevance of such hotels comes in. These establishments are open 24 hours a day. The rooms are provided as usual, with a minimum of necessities. No decorations. Unless flower pots are allowed. Everything is simple and discreet.

Again, for Russia, despite the high mortality rate and unstable demographic component, such “numbers for the deceased” are unlikely to become necessary. Moreover, it is necessary to take into account the differences in religions of our citizens. According to the traditions of some of them, the body of the deceased is buried on the same day.

Taxation

The taxation system in the country is distinguished by its loyalty to non-residents. The fixed tax amount for a foreign citizen is equal to that paid by local entrepreneurs.

There are two tax options:

1. Zero tax. Only on the condition that the enterprise does not conduct trade operations in the country and does not import it into Japan;
2. Other commercial activities that require tax on the company's income:

• corporate income tax;
• local profit income;
• tax on annual capital and income.

Capsule hotel, hostel

In Japan, hotels have begun to appear that are oversized sleeping cells that are placed on top of each other.
They are located near train stations, airports, and entertainment centers. Such a room looks like a capsule measuring 2x1x1.25 m. In the allotted space you can lie down, watch TV, and read. As a rule, guests are asked not to smoke or eat in the room. The “rooms” are located one above the other in several tiers. Privacy can be ensured by using a curtain in front of the door. Clients' belongings are stored in cells located near the capsule. Toilets are also separate and shared.

The guests of such hostels and hotels are tired office workers who do not want to spend a lot of time driving home, business travelers or drunk people who are afraid to get behind the wheel and drive home.

Offshores

Offshore legislation provides for the following types of companies to establish a business in Japan:

• Corporation;
• Business partnership;
• Limited Liability Partnership;
• Limited Liability Company.

To register an offshore company you will need the following documents:

• Foundation agreement with notarization;
• Company Charter;
• Authorized capital documents;
• Intellectual property;
• Real estate capital value.

Japanese legislation has created very favorable conditions for offshore business. Among them, low VAT (5% of added value) stands out, as well as the confidentiality of all banking and financial transactions.

Negotiation

Business negotiations in Japan take place in the form of friendly conversation. The Japanese will be friendly and polite, and will often nod approvingly in response to your proposals, but this does not mean at all that they have already agreed to a deal with you. This is just a manifestation of Japanese politeness.

When communicating in business, the Japanese are not prone to categorical and harsh refusals. It is almost impossible to hear even just the word “no” from a Japanese person. If the Japanese is not satisfied with any of the terms of the transaction or does not want to carry out it for other reasons, then he will say something vague like “we will give an answer a little later” or “this matter requires some thought.” But if the Japanese are satisfied with everything, then he will express his consent immediately. Also, the Japanese extremely rarely use the prefix “not-” in words and phrases. During a business conversation, try to utter negative words as little as possible.

When negotiating, it is worth considering the differences between the cultures of Japan and your country. Despite all the friendliness of the Japanese, try to avoid jokes during a conversation. The Japanese may misunderstand them and you will find yourself in an awkward position. The same applies to linguistic expressions that are inherent in a particular culture. Your figurative phrases “a piece of cake”, “you’re killing me”, “pounding water”, etc. will be very inappropriate, as the Japanese will take it literally.

Returning to the topic of collectivism in Japan, express respect not so much for the personality of your interlocutor, but for the company he represents. It will be much more valuable to him.

The Japanese are always true to their word. If your interlocutor agreed to the deal verbally, you don’t need to immediately push him a bunch of papers to sign. If the Japanese made a deal orally, then rest assured that he will do it in writing, but only when he himself is ready for it.