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“Characteristics of the Japanese Market and
How to Penetrate into the J Market
November 2010
JETRO HANOI
Senior Advisor
Hitoshi SAKAI
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Vietnamese Items in Japan
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Import Share of Specific Vietnamese Items in Japan (2008) (1)
Import Items Import Amount(USD Million)
Import Ranking (within Top Three) & Import Share (%)
Wiring sets 709 China (42.1), Vietnam (21.7), Philippines (11.3)
Frozen shrimps & prawns
369 Vietnam (21.1), Indonesia (20.1),India (11.2)
Hard coal 369 China(48.3), Vietnam (33.3), Australia (10.2)
Other wooden furniture
147 China (47.3), Vietnam (12.6), Indonesia ( 9.3)
Printed circuits 119 China (53.0), Taiwan (19.4), Vietnam (8.4)
Shrimps & prawns (prepared/ preserved)
104 Thailand (50.5), Vietnam (19.8), China (16.4)
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Import Share of Specific Vietnamese Items in Japan (2008) (2)
Import Items Import Amount(USD Million)
Import Ranking (within Top Three) & Import Share (%)
Other garments, women's/ girls' (of other textile materials)
99 Vietnam (64.0), China (34.6), Italy (0.3)
Other footwear with outer soles & uppers (of rubber or plastics)
63 China (88.8), Vietnam (4.5), Indonesia (2.9)
Glutamic acid 55 Vietnam (38.3), Brazil (28.0), Indonesia (20.6)
Men's or boys' trousers, overalls, breeches (of cotton)
53 China (73.0), Vietnam (7.6), Italy (6.5)
Toilet linen, Kitchen linen (of cotton)
53 China (84.9), Vietnam (10.0), Indonesia (1.5)
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Import Share of Specific Vietnamese Items in Japan (2008) (3)
Import Items Import Amount(USD Million)
Import Ranking (within Top Three) & Import Share (%)
Co-axial cable and other co-axial conductors
48 China (76.5), USA (7.2), Vietnam (3.4)
Men's or boys' trousers (of synthetic fibers)
45 China (83.8), Vietnam (9.7), Myanmar (3.6)
Other articles of glass 44 China (43.0), Vietnam (23.5),
USA (10.9)Squid (frozen fillets) 43 Thailand (33.9), China (26.1),
Vietnam (18.1)
Women's or girl‘s trousers (of cotton)
38 China(87.2), Vietnam (3.3), Italy (2.1)
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Retail Structure in Japan
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Retail Market Shape by Area in Japan
Geographical Shape
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Overseas Manufactures Japanese Manufacture
Offshore Facilities
JapaneseSubsidiary of
Overseas Companies
ImportAgents
Japanese
Manufacture
Headquarters
Wholesalers→Retailers
Consumers
Distribution Channels in Japan for Imported Products(1)
12 4 3
1 23
Internet Dealing
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Consumers are king and queen.Suppliers are servant.
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Flow Chart from Planning to Procurement of Products in Japan
Product Planning from the viewpoint of
consumers
Product Designing
Cost-Price Performance
Global Procurement of
Products
Low cost
Production in the right places in
the World
Supply
(Producers) Side
Viewpoint
Demand (Consumers)
Side Viewpoint
X O
Internet Dealing Ratio in Japan
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12.6%13.3% 13.5% 13.7%
1.3% 1.5% 1.8% 2.1%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
2006 2007 2008 2009
B2B
B2C
Background of Increasing the Ratio : (1) Decreasing Risks of Internet Dealing, (2) Close Relation with TV Shopping,
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IT changes Domestic Distribution System in Japan
IT(Synchronized R
esponse)
Manufactures
Wholesalers
Retailers
IT
Synchronized Linkage
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No-selling items (Dead Stock) could be changed into slow-selling items.
• Internet dealing has not any products in stock. • Internet dealing has a huge number of customers.
Fast-Selling
Dead StockNo-Selling
Steady-Selling
Elapse of Time
Turning UPTurning Down
Effect of Internet Dealing
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Effect of Internet Dealing
• Internet dealing expands categories of goods for not only practical use, but also hobby use.
Fast-Selling Steady-Selling
Practical use
Hobby use
Dead StockNo-Selling
Turning DownTurning UP
Elapse of Time
Internet dealing expands sales categories.
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Current Characteristics of Japanese Markets
*Honest, *Responsibility,*5S(Seiri, Seiton,~)
*Nobel prizes,*High technologies
Multiplex Culture of Japan
*Geisha-Girls,*Kabuki-Cho Amusement
Area
MultiplexLife Style
Pleasure Aspect
Serious Aspect
Accumulation of
Technology& Service
*Akiba Electronics Street, *Maid Cafes
TechnologyAccumulation
Service Accumulation
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Geisha-Girls
Pleasure Aspect and Service Accumulation of Japanese Culture introduced in the US
Mt. Fuji
Kabuki-Cho Amusement AreaAbout 4000 Restaurants and others
Akiba Electronics Street About 1000 Electric Shops and
Others
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Example of Items with New Ideas
Nubrella
USD 60~100/unit
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Example of Items with New Ideas
Bilk=Beer+Milk
USD 4 /bottle (330ml)
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Example of Items with New Ideas
Soap made from mother’s milk (Gifts for relatives)
USD 100 /10 bricks
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Example of Items with New Ideas
Untrue item (Not Existing)
Carton-packed milk made from mother’s milk
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Example of Items with New Ideas
Ice cream with horse meet
Ice cream with eel meet
USD 4 /cup (80ml)
USD 5 /cup (120ml)
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Example of Items with New Ideas
USD 80 /cushion
Pillow of Mens’ head on Ladies’ lap (Hobby use)
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Example of Items with New Ideas
USD 220 /pair
New Designed Shoes (Hobby use)
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Example of Items with New Ideas
New Designed Shoes (Practical Use)
USD 150 / pair
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Example of Items with New Ideas
Socks in combination with shoes (Practical Use)
USD 4 / pair
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Example of Items with New Ideas
USD 15 /sheet
MD (Multi-Dimension) Mask Dust Filter Mask
USD 12 /sheet
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Example of Items with New Ideas
Earphone with a Japanese sword
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• The Galapagos islands have unique spices evolved originally from other areas.
• If unique spices take away from the Galapagos, they have no capability to adapt to a new environment.
An Iguana A giant tortoise
Some Japan systems as Galapagos Syndrome
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• Unique evolution can be seen in Japanese mobile phone systems, which are different from foreign systems. Therefore, Japanese mobile phone system can not be used in foreign countries.
GSM
69.2%
CDMA
19.9%
WCDMA
10.3%
Some Japan systems as Galapagos Syndrome
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• Japan system have been developed aiming at high technologies. However expensive construction technologies in Japan prevent to use them in foreign countries.
Some Japan systems as Galapagos Syndrome
Japanese skyscraper system can not export to foreign countries due to expensive structure with earth quake-proof.
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Retail Food Sector in Japan
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Japanese Characteristics for Food Consumption (1)
Current Trend in Japan Japanese preferenceThe income gaps are increasing recently in Japan, resulting in the popularity of low-price foods.
First foods and convenient foods have been prevailing over slow foods and gorgeous foods.
Can of stewed foods
Can of Chinese noodles in soup
Can of Indian noodles in soup
Can of sour noodlesin soup
Several Tablet Foods
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Japanese Characteristics for Food Consumption (2)
A rising awareness for imported food (Safety First)
An import case of ‘poisoned (agricultural chemical)’ Chinese dumpling in Japan taken place in 2008
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Retail Garment Sector in Japan
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Changes in style by Cool Biz and Warm Biz
Cool Biz Conventionally Casually Styling Uniform-like High degree of freedom
Summer Garments
Jacket Essential Not essentialTops Mostly Jackets Mostly Shirts
With variationsBottoms Suits Trousers Several pairs of
different stylesOthers Tie is essential Tie is not essential.
Type of shoes, belts and bags are fixed.
Type of shoes, belts and bags of varied
types
Comparison between Tradition and Trend
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Changes in style by Cool Biz and Warm Biz
Warm Biz Conventionally CasullyStyling Uniform-like High degree of freedom
WinterGarments
Jackets Suit Jacket JacketTops Business Shirt All types of shirt
With variationsSupple-mentary
Items
No YesWith variations
Bottoms Suit Trousers Several pairs of different types
Coat Essential as a thermal coat
Not
Others Tie is essential. Tie is not essential.Type of shoes, belts and
bags are fixed.Shoes, belts and bags of
varied types
Comparison between Tradition and Trend
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Changes in style by Cool Biz and Warm Biz
Conventionally
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Changes in style by Cool Biz and Warm Biz
Cool Biz
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Changes in style by Cool Biz and Warm Biz
Warm Biz
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Changes in style by Cool Biz and Warm Biz
New Fashion mixed with Tradition and Trend
Fashion Trend 2010: Casual & Elegant (Knitted Wear)
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New Arrival from UNIQLO• Total Sales Revenue in 2010 : 100 billion USD • Concept of products : Unique technology + Low Price
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Ultra Light Down with High-Tech processing 200 g Warm & Light 300g
USD 70 USD 90
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Thank you very much for your attention.
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