JAPAN your way in ASIAN business

JAPAN
your way in
ASIAN
business
gateway
SCMaglev (Superconducting Maglev)
will travel at 500 km/h to link Tokyo and Osaka in 67 minutes. Services to Nagoya are
planned to commence by 2027, and to Osaka by 2045. The train can reach a maximum
speed of 581 km/h (world speed record for rail vehicles).
© Central Japan Railway Company. All rights reserved.
JAPAN—
YOUR
INNOVATIVE
BUSINESS
PARTNER
In Asia,
Japan is
1. the best country to create
innovation.
2. a country with the best
business and living environments
in terms of safety, medical
services, etc.
3. a country with “soft power”,
which sets trends for fasHions and
entertainment content in Asia.
Source: JETRO (www.jetro.go.jp/en/invest/)
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The ma rket
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eq uivalent to of Ja pa n is enorm ou s, an
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Photos: Finnair & Japan Airlines
JAPAN for
FINNISH COMPANIES
observations and recommendations by Finpro Tokyo
DIFFERENCES
1. Hunters / Farmers
Finnish companies are usually “hunters” in mindset and try to actively hunt new customers
and new markets to survive, often resulting in an image of an unsystematic and short-term
business style for their Japanese counterparts. On the other hand, the Japanese market is
based on a “farmers” mentality and Japanese companies try to harvest from existing business
areas and serve their current customers as well as possible, which may give the image of an
unmotivated or incapable company for Finns.
2. Flat / Layers
In Finland, companies have flat organisation structures and a very practical and informal
business style, allowing them to be dynamic and straightforward in their business
negotiations. This is not the case in Japan, where companies have many layers in the decisionmaking process and thus business planning and negotiations are managed by well-organised
processes and traditions, which is often considered a time-consuming burden for Finns.
MUTUAL BENEFITS
Finnish SMEs can be more attractive partners for Japanese companies if their business
proposal includes co-operation in other countries as well. Japan is often a reference market
for other Asian markets; success in Japan and partnership with Japanese companies usually
creates a positive image in other Asian markets. Such branding is a symbol of the reliability of
business and product quality.
From Japanese companies’ perspective, Finns usually operate globally and have vast
experience with doing business in foreign markets. Finnish companies have not always
recognised the value of their wide sales channel network and good language skills, which can
be valuable assets in co-operation with Japanese companies. Finnish companies can offer
easier and less risky access e.g. to EU and Russian markets.
RECOMMENDATIONS
Study carefully the value chain in Japan
i.e. “who is playing the game” in their business, which customers segments are the most
important ones and how to reach these segments in complicated market structures. It is
highly important to understand the segmented market structure in Japan, caused by its large
scale, maturity and business traditions.
Verify your target market and competitive advantage in advance
This can make it easier for Japanese companies to understand the benefits of co-operation
and make decisions much faster.
Provide written materials
Due to some language difficulties, it is important for Finnish companies to prepare good
written information to allow Japanese companies to study material internally for better
understanding and to accelerate the planning process.
Prepare for speedy business
Aside from the initial step-by-step processes, slow actions by Japanese companies are usually
limited to the planning phase only. After the product launch and especially when riding a
wave of popularity, the speed of business can be very fast. This can cause difficulties for
Finnish SMEs with limited resources if this is not prepared and planned for well in advance.
Understand the importance of “after-services”
For Japanese, technology must always come with good service to be a good concept.
Thus after-sales issues usually play an important role in Japan to evaluate the product and
partnership. This is understandable for the farmer mentality, but the hunters might get
frustrated to answer detailed service questions even before a single unit has been sold.
The rise of the Japanese economy, after two decades of stagnation
and deflation, has been noticed all over the world. The recent
economic growth of Japan has been one of the strongest globally.
Numerous economic indicators have turned upwards after the
introduction of the Three-Arrow Economic Policy – what has come
to be known as “Abenomics”.
I will not go into details over the figures. I would merely say that the
most important aspect of the impact of Abenomics is the changed
mindset of the Japanese people. They are no longer asking whether
an economically-vibrant Japan might at long last be making a
comeback, now they increasingly believe it IS coming back. This
spring’s wage negotiations, for example, prove that the domestic
optimism is well-founded, as wages are increasing more than earlier.
An integral part of Abenomics is a recognition of the importance of
global economic integration. The Japanese government’s Growth
Strategy has set a target of doubling the amount of foreign direct
investment in Japan by the year 2020. This will be achieved by
creating a more business-friendly environment through regulatory
reform. For instance, the corporate tax rate in Japan has been
lowered as of April 2014.
Another crucial element is the establishment of Strategic Special
Zones in various parts of Japan. The first six of these have already
been selected. Addressing the concerns raised by overseas
companies, the employment guidelines for these zones will be
simplified, for instance.
More and more foreign companies in Europe see Japan as a regional
hub of innovation and R & D. It is also a “trend-setter”, a huge market
of fashion-conscious consumers, where European enterprises can
test-market their products or services before entering other Asian
markets. For you, in terms of Asia Business, Japan can be a gateway,
a basecamp, a launching-pad, a partner – you name it.
The shared challenge of Japan and Finland alike is the ageing of the
nation’s population. At the same time, it offers a great potential for
business cooperation in health care and social services. The Finland
Wellbeing Center in the city of Sendai is an outstanding example of
how sophisticated technology and know-how in both countries can
help to answer these demographic challenges.
Another promising sector of cooperation is the information and
communications technology (ICT) branch. There are existing and
potential business opportunities for the use of ICT, not only in
the above-mentioned medical and nursing care field, but also in
such areas as the railway network and in maritime navigation. The
collaboration in the energy sector, for instance in renewable energy
resources, could also be promoted further. It could be a genuine
win-win situation.
As you know, JAL has chosen Helsinki-Vantaa Airport as one of its
two hubs in the European market, alongside London’s Heathrow.
Recently, establishing the new joint business partnership with
Finnair now guarantees that Tokyo, Nagoya, Osaka and other major
economic zones in Japan become ever closer to businesses in
Finland and in other parts of Europe.
And it is not just about business. We would like to double the
number of international students studying in Japan, from 60 000
to 120 000 by the year 2020, and we aim to attract 30 million
annual tourists by 2030, a three-fold rise from the present level.
The Olympic Games in Tokyo in 2020 will certainly raise travelers’
interest much sooner than this. Helsinki is becoming more and more
a gateway to Japan in terms of tourism as well as business.
The recovery of the Japanese economy offers a multitude of new
opportunities, and the time to seize them is now!
Now is
the time
to do
business
in Japan
Japan as
a Gateway to
Business in Asia
Ambassador
KENJI SHINODA
EK
“
Finnish and
Japanese firms
can find great
co-operation
possibilities
not only in the
Japanese and
Finnish markets,
but globally as
well.
Trade relations between Finland and Japan are going through
a dynamic phase. Japan is world renowned for its industrial,
technological and economic strengths and is an important trading
partner for Finland – our third largest trading partner outside
Europe.
Finnish business sees enormous possibilities for enhancing our
trade and economic co-operation in numerous fields. Already some
40 Finnish companies are established in Japan and a few hundred
Finnish companies are operating through a business agency.
More and more Finnish companies are looking for new business
opportunities and co-operation possibilities with Japanese trading
partners.
Many Finnish companies are global leaders in their respective
fields. Cleantech is Finland’s main business priority and is a focus of
long term investments in R&D. The forest and chemical industries,
information and communication technologies, engineering
technology, infrastructure development and construction and cargo
handling are some examples of our high expertise.
Finnish culture has also found many fans in Japan, especially music,
architecture and design - The Moomins, Marimekko and Iittala are
already well-known Finnish brands.
Daily direct flights from Helsinki to Tokyo, Osaka and Nagoya have
created good conditions for the development of Finnish-Japanese
trade relations and tourism. Japan is at the heart of the Finnair’s
Asian strategy. Finnair is already one of the biggest European
airlines in Japan.
Well-functioning maritime and sea-rail connection through Russia
facilitates business between Finland and Japan. In the forthcoming
years Finnish-Japanese business will also benefit from wider use of
the Northeast Passage in maritime transportation.
Finland is known as a prominent gateway to Russia. By truck, train
or air Finland is a secure and fast way to deliver goods anywhere
in Russia, especially to the St. Petersburg and Moscow regions.
Helsinki is a major hub for travelling to and from Russia by air and
train.
Finnish companies see great potential in doing business in cooperation with Japanese companies in the Arctic region. This
concerns not only trade and investment, but also services. Both
Finnish and Japanese companies are already experienced in
developing products and services suitable for the Arctic conditions.
The level of expertise can be further developed by combining
Finnish and Japanese skills and know-how.
Ilpo Kokkila
Chairman
Confederation of Finnish
Industries (EK)
Finnish business supports enhancing the economic relations
between Japan and Finland at all levels. Therefore Finnish business
is looking forward to an ambitious EU-Japan trade agreement that
will give a boost to our trade relations by removing existing trade
barriers.
We look forward to enhancing our trade relations by building longterm trade and investment ties with your business community. It
is worth keeping in mind that Finnish and Japanese firms can find
great co-operation possibilities not only in the Japanese and Finnish
markets, but globally as well.
Dear reader
Russia and Japan are among the most interesting markets
for Finnish companies looking for new international business
opportunities. In terms of expertise, technology and reputation,
many Finnish companies are well placed to successfully enter one
or both of these two very different markets. Could your company be
one of them?
Russia’s economy is characterised by its strong modernisation drive
and infrastructure development, and underpinned by the growing
appetite of its 140 million consumers for quality services and goods.
In Saint Petersburg, the most popular dairy products, comfortable
log houses and modern apartment houses are already produced by
Finnish companies. Finnish retailers are expanding food store chains
and operating department stores. But Russia also offers unexplored
potential beyond Saint Petersburg and Moscow which is yet to be
discovered by many Finnish enterprises.
Japan is one of the world’s leading consumer-driven economies and
has an impressive record as a hi-tech powerhouse. The ongoing
energy sector reform presents great opportunities for co-operation
between Japanese and Finnish companies, especially in biomass
and wind energy both in Japan and Northern Europe. Cooperation possibilities also exist in the development of innovative
ICT solutions, for example in medical and care, smart navigation
for the automotive and transportation industry, and smart house
technologies. Finnish companies can also benefit by partnering with
Japanese companies to enter South Asian markets. It is worth noting
that Japanese companies and tourists are increasingly interested
in Finland. Last year, Japanese companies SoftBank and Gung Ho
invested USD 1.5 billion in a 51% stake of the Finnish game developer
Supercell.
FINPRO
“
The creation
of mutual
prosperity
through dynamic
business
links is also
an important
shared value
between
Finland, Russia
and Japan ...
Finpro and Team Finland have a clear mission: to support the
international growth and success of Finnish companies. The
internationalisation of Finnish companies has contributed greatly to
the development of the Finnish economy, and will continue to play
a crucial role in the future of our society. The international success
stories you create today are the building blocks of a flourishing
Finland tomorrow. The creation of mutual prosperity through
dynamic business links is also an important shared value between
Finland, Russia and Japan.
The expertise at Finpro and Team Finland is focused on serving
your company’s needs throughout the different phases of the
internationalisation process, from identifying opportunities and
planning your market entry to establishing an international presence
and improving your market position. We will help you to find new
customers and arrange suitable funding, enabling you to be in the
right markets at the right time with a competitive concept and
offering.
Finpro and Team Finland also support active co-operation between
Finnish companies operating in Russia and Japan. For example,
there are Export Partner Groups that help Finnish companies
launch their export operations and build new sales and marketing
channels, providing a cost-effective way to enter new markets. We
are happy to share our experiences in this area and also discuss the
possibilities of working with Russian and Japanese companies as
business partners.
Taking advantage of the diverse potential business opportunities
offered by Russia and Japan is worth careful consideration by every
Finnish company interested in international growth. I am convinced
that the combination of your company’s products, services and
expertise with our networks and knowledge of both countries can
be a winning formula to achieve that growth. Let’s talk more about
Russia and Japan — I look forward to hearing from you!
Markus Suomi
CEO
Finpro
JETRO at your service!
JETRO, or the Japan External Trade Organization, is a governmentrelated organization that works to promote mutual trade and
investment between Japan and the rest of the world.
• Comprehensive support for foreign companies through JETRO’s
“Invest Japan Hotline”
• Giving consultation on administrative procedures required for FDI
into Japan
• Arranging meetings with regulatory agencies if needed
• Relaying requests for regulatory reforms to the Japanese
government
JETRO Helsinki Branch
Mannerheimintie 12 B 5th floor,00100 Helsinki, Finland
Tel +358-9-2516-6399 Fax +358-9-2516-6100
[email protected]
JETRO Invest Japan Hotline (Japan)
Tel +81-3-3582-4684
www.jetro.go.jp/en/invest/hotline/
FJCC
Finnish Japanese Chamber of Commerce (FJCC) is a non-profit
business association for Finnish companies doing business in Japan
and Japanese companies doing business in Finland. We have been
in existence for more than 30 years and serve our members’ needs
with passion and commitment. Our sister organisation in Tokyo is the
Finnish Chamber of Commerce in Japan.
Our mission is to promote trade and business understanding between
Finland and Japan. We engage both business decision-makers and
interested private individuals in networking and social and cultural
events, with the purpose of creating an environment where personal
contacts can be established and strengthened.
Finnish-Japanese Chamber of Commerce
c/o Finland Chamber of Commerce P.O. Box 1000, 00101 HELSINKI
Tel. +358-9-4242-6228 Fax. +358-9-650-303
kauppayhdistys.fi/finnish-japanese/
EMBASSY OF JAPAN
Unioninkatu 20-22, 00130 Helsinki, Finland
Tel +358-9-686-0200 Fax +358-9-633-012
[email protected]
www.fi.emb-japan.go.jp