“Characteristics of the Japanese Market and How to ... · Japanese Characteristics for Food...

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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

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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.