Characteristics of the Japanese Market and How to Penetrate into the J Market
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1 Characteristics of the Japanese Market and How to Penetrate into the J Market November 2010 JETRO HANOI Senior Advisor Hitoshi SAKAI 1
2 Vietnamese Items in Japan 2
3 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) 3
4 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 63 China (88.8), Vietnam (4.5), Indonesia (2.9) (of rubber or plastics) Glutamic acid 55 Vietnam (38.3), Brazil (28.0), Indonesia (20.6) Men's or boys' trousers, overalls, breeches (of cotton) Toilet linen, Kitchen linen (of cotton) 53 China (73.0), Vietnam (7.6), Italy (6.5) 53 China (84.9), Vietnam (10.0), Indonesia (1.5) 4
5 Import Share of Specific Vietnamese Items in Japan (2008) (3) Import Items Co-axial cable and other co-axial conductors Men's or boys' trousers (of synthetic fibers) Import Amount (USD Million) Import Ranking (within Top Three) & Import Share (%) 48 China (76.5), USA (7.2), Vietnam (3.4) 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) 5
6 Retail Structure in Japan 6
7 Geographical Shape Retail Market Shape by Area in Japan 7
8 Distribution Channels in Japan for Imported Products(1) 1 Overseas Manufactures Japanese Subsidiary of Import Overseas Agents Companies Internet Dealing Wholesalers Retailers Japanese Manufacture Offshore Facilities 4 3 Japanese Manufacture Headquarters 3 Consumers 8
9 Consumers are king and queen. Suppliers are servant. 9
10 Flow Chart from Planning to Procurement of Products in Japan Supply (Producers) Side Viewpoint X Product Planning from the viewpoint of consumers O Demand (Consumers) Side Viewpoint Product Designing Production in the right places in the World Cost-Price Performance Low cost Global Procurement of Products 10
11 Internet Dealing Ratio in Japan 16.0% 14.0% 12.0% 12.6% 13.3% 13.5% 13.7% 10.0% 8.0% 6.0% B2B B2C 4.0% 2.0% 0.0% 1.3% 1.5% 1.8% 2.1% Background of Increasing the Ratio : (1) Decreasing Risks of Internet Dealing, (2) Close Relation with TV Shopping, 11
12 IT changes Domestic Distribution System in Japan Retailers Wholesalers Manufactures IT Synchronized Linkage I T (Synchronized Response) 12
13 Effect of Internet Dealing No-selling items (Dead Stock) could be changed into slowselling items. Fast-Selling Steady-Selling Internet dealing has not any products in stock. Internet dealing has a huge number of customers. Turning Down Turning UP Elapse of Time Dead Stock No-Selling 13
14 Effect of Internet Dealing Internet dealing expands sales categories. Hobby use Fast-Selling Steady-Selling Internet dealing expands categories of goods for not only practical use, but also hobby use. Turning Down Turning UP Elapse of Time Dead Stock No-Selling Practical use 14
15 Current Characteristics of Japanese Markets 15
16 Serious Aspect *Honest, *Responsibility, *5S(Seiri, Seiton,~) Multiplex Culture of Japan Technology Accumulation *Nobel prizes, *High technologies Multiplex Life Style Accumulation of Technology & Service Pleasure Aspect *Geisha-Girls, *Kabuki-Cho Amusement Area Service Accumulation *Akiba Electronics Street, *Maid Cafes
17 Pleasure Aspect and Service Accumulation of Japanese Culture introduced in the US Mt. Fuji Geisha-Girls Kabuki-Cho Amusement Area About 4000 Restaurants and others Akiba Electronics Street About 1000 Electric Shops and Others 17
18 Example of Items with New Ideas Nubrella USD 60~100/unit 18
19 Example of Items with New Ideas Bilk=Beer+Milk USD 4 /bottle (330ml) 19
20 Example of Items with New Ideas Soap made from mother s milk (Gifts for relatives) USD 100 /10 bricks 20
21 Example of Items with New Ideas Carton-packed milk made from mother s milk Untrue item (Not Existing) 21
22 Example of Items with New Ideas Ice cream with horse meet USD 5 /cup (120ml) Ice cream with eel meet USD 4 /cup (80ml) 22
23 Example of Items with New Ideas Pillow of Mens head on Ladies lap (Hobby use) USD 80 /cushion 23
24 Example of Items with New Ideas New Designed Shoes (Hobby use) USD 220 /pair 24
25 Example of Items with New Ideas New Designed Shoes (Practical Use) USD 150 / pair 25
26 Example of Items with New Ideas Socks in combination with shoes (Practical Use) USD 4 / pair 26
27 Example of Items with New Ideas MD (Multi-Dimension) Mask Dust Filter Mask USD 15 /sheet USD 12 /sheet 27
28 Example of Items with New Ideas Earphone with a Japanese sword 28
29 Some Japan systems as Galapagos Syndrome 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 29
30 Some Japan systems as Galapagos Syndrome 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. WCDMA 10.3% CDMA 19.9% GSM 69.2% 30
31 Some Japan systems as Galapagos Syndrome Japan system have been developed aiming at high technologies. However expensive construction technologies in Japan prevent to use them in foreign countries. Japanese skyscraper system can not export to foreign countries due to expensive structure with earth quake-proof. 31
32 Retail Food Sector in Japan 32
33 Japanese Characteristics for Food Consumption (1) Current Trend in Japan The income gaps are increasing recently in Japan, resulting in the popularity of low-price foods. Japanese preference First foods and convenient foods have been prevailing over slow foods and gorgeous foods. Several Tablet Foods Can of Chinese noodles in soup Can of Indian noodles in soup Can of sour noodles in soup Can of stewed foods 33
34 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
35 Retail Garment Sector in Japan 35
36 Summer Garments Changes in style by Cool Biz and Warm Biz Comparison between Tradition and Trend Cool Biz Conventionally Casually Styling Uniform-like High degree of freedom Jacket Essential Not essential Tops Mostly Jackets Mostly Shirts With variations Bottoms Suits Trousers Several pairs of different styles Others Tie is essential Tie is not essential. Type of shoes, belts and bags are fixed. Type of shoes, belts and bags of varied types 36
37 Winter Garments Changes in style by Cool Biz and Warm Biz Comparison between Tradition and Trend Warm Biz Conventionally Casully Styling Uniform-like High degree of freedom Jackets Suit Jacket Jacket Tops Business Shirt All types of shirt With variations Supplementary Items No Yes With 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 37
38 Changes in style by Cool Biz and Warm Biz Conventionally 38
39 Changes in style by Cool Biz and Warm Biz Cool Biz 39
40 Changes in style by Cool Biz and Warm Biz Warm Biz 40
41 Changes in style by Cool Biz and Warm Biz New Fashion mixed with Tradition and Trend 41
42 Fashion Trend 2010: Casual & Elegant (Knitted Wear) 42
43 New Arrival from UNIQLO Total Sales Revenue in 2010 : 100 billion USD Concept of products : Unique technology + Low Price Ultra Light Down with High-Tech processing 200 g Warm & Light 300g USD 70 USD 90 43
44 Thank you very much for your attention. 44
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