Creating value in Japan

19 October 2016

Did you see the Japanese Prime Minister appear as Super Mario at the end of the Rio Olympics signalling that Tokyo is hosting the 2020 Olympics? 

For Prime Minister Abe to appear dressed as Super Mario was a surprise for most of Japan as well, but the publicity stunt shows a willingness to do something new and something that engages international audiences.

The lines of the song go “I think I’m turning Japanese”…well, it is the Japanese that are now looking to become even more familiar with the world outside of Japan and what it can offer Japan.

Some of this is through necessity with challenges around food self-sufficiency including farming techniques, lack of arable land, seasonal products etc.

Some of this is through opportunities like hosting the Rugby World Cup and the Tokyo Olympics, which will attract a lot of foreign visitors and is driving change in the education sectors with the Government funding the promotion of English language study domestically and internationally.

Even the aging population creates potential to target consumers as they become even more discerning about health and nutrition – asking where products are from and what ingredients they contain.

I have been in Japan for two months and have met the Emperor of Japan Akihito, the Bill Gates of Japan (Masayoshi Son from Softbank), presidents and senior officials from many influential Japanese corporates, ministers from New Zealand and Japan, and the heads of most of New Zealand’s large corporates with operations in Japan.

I have seen New Zealand tuna at the fish markets at 4:30am and been able to spend time in the cool Cookie Time store in the hip Harajuku area of Japan. Japan’s population may be declining but the city of Tokyo, with nearly 30 percent of the total population feels very alive and open for business.

Japan is a country of 128 million people with a lot of varied interests and as informed consumers they have a willingness to pay well for products they believe will be good for them, good for the environment, brands they can associate with and products that provide comfort for the mind and body.

A lot of New Zealand companies are doing well in Japan and getting real value from this market. The volumes may be higher in other markets but the stability, margin and profits, relative ease of business and general business attitude makes Japan a market worth considering. It does mean making a long-term commitment but as many companies have found, if you can make it work in Japan and meet the customer expectations here, most other markets will be much easier to succeed in.

It is exciting to see the range of New Zealand companies successfully doing business here – wool from New Zealand farms directly sourced for a suit company with over 400 outlets, parts for use in nuclear magnetic resonance spectroscopy and heavy ion radio therapy, medical devices that are almost a monopoly in their category, wine served in first class on Japanese airlines, ingredients used in Michelin starred restaurants, pies in convenience stores, water-jet propulsion units in coast guard vessels, furniture in schools, ICT solution such as search engine optimisation and content aggregation and feed for racing horses.

Is Japan a target market for you or your company? Should it be? Areas that will provide further opportunities for growth are renewable energies, investment, agricultural reforms and moving up the value chain in F&B. Combined with the leveraging of the Rugby World Cup in 2019 and the Olympics in 2020, the next four years in Japan will be great timing to further develop relationships and opportunities or at least test the waters.

Japan is a significant source of economic value to New Zealand and many exporters enjoy good margins & profits. Japan is looking to become even more familiar with the world outside of Japan. And don’t forget to consider the positive resonance of aligning with the New Zealand Story for Japan.

Craig Pettigrew is New Zealand’s Trade Commissioner in Japan.

Hear Craig speak at the Japan New Zealand Business Council Conference in Wellington 23-25 November. For more information head to: www.jnzbc.com