HOW TO START AN IMPORT-EXPORT BUSINESS IN JAPAN | Japan's Main Import-Export Products
Hi everyone. Thanks for coming here. Do you live in Japan and want to start your own import-export business in Japan, but do not know how to get started or how to become successful? Or do you live in another country and are considering starting an export-import business with Japan? Perhaps you are interested in learning what products are eligible for import or export in relation to Japan? Or maybe you want to know the clear procedures for exporting or importing from Japan? Well, in this video I give you all the answers, resources, and show you step by step how to start an export and import business in Japan or with Japan. I also give you many business ideas for your venture. No matter what your purpose is with the import-export business, maybe you want to live a better life, make more money, or just satisfy your passion.
I always stand behind your decision and help you succeed in this business. With my years of experience in the import-export business and international business, I will provide you with the necessary knowledge, and useful practical experience to help you lay the foundation to start this exciting journey. Hello everyone, I would like to welcome you again. My name is Murat.
I am Head of Global and co-founder of Solar Solenturk and Futuresia Global Trade. Today, in the third country video, we are going to talk about Japan. And together we will learn how to build an import-export business in Japan. If you would like me to do similar videos in other countries, please write in the comments which country you would like to see.
So before you start, do not forget to subscribe to my channel and hit the bell for more high-quality content on how to start your dream business in international trade and change your life. Let us dive in. In my experience, when we do business with a new country, we should first learn something about that country and its people. So let us first get an overview of Japan. First, we look at an overview of the Japanese business environment and economy. Japan is an island nation located in East Asia.
Japanese people make up about ninety-eight point one percent of the total population of the country. Nearly thirteen point eight million residents live in central Tokyo, the country's unofficial capital. The Tokyo metropolitan area, including the capital and surrounding provinces, is the largest metropolis in the world with a population of more than thirty-five million and has the most urbanized economy in the world.
Japan's economy is a developed market economy. In two thousand twenty, the size of the economy is the third largest nominal Gross Domestic Product measure in the world after the United States and China. If purchasing power parity is used, Japan is the fourth-largest economy after the United States, China, and India. Under the Free Trade Agreement between Japan and the European Union, the country will eliminate tariffs on about ninety-four percent of goods imported from the EU starting in two thousand thirty-five, and Europe will also phase out tariff barriers over the same period. This will create huge business opportunities for entrepreneurs on both sides. Tokyo has also started trade talks with the US in two thousand nineteen.
Japan is a country with an industrialized and high-tech economy, which is reflected in its leading exports that focus on products such as automobiles, optics, machinery, healthcare, and robotics. Japan also has a competitive advantage in the export of ships, boats, and other floating structures. The main groups of Japanese exports are automobiles, machinery, robotics, electronic equipment, engineering optics, medical equipment, iron and steel of all kinds, chemicals, and plastics. Japan's largest export partners are China, the USA, Korea, Thailand, and Hong Kong. Imports include machinery and equipment, fuels, food, chemicals, textiles, and raw materials (especially minerals and energy products). Japan’s import partners are China, the USA, Australia, Saudi Arabia, United Arab Emirates, South Korea.
Let’s look at the characteristics of the Japanese. The Japanese have a very special personality. Perhaps it is due to these characteristics that the Japanese have made their country, which is poor in raw materials and has a harsh climate, into a great power. The Japanese characteristics are as follows: They have a progressive and sensitive mind that is responsive to changes in the world. They are willing to break new ground but still retain their identity. Strengthening the common, the collective, renouncing the individual ego.
The collective can compete with each other, but can also work together to achieve common goals. They do not like confrontation with others, especially personal confrontation. They pay attention to harmony.
It is important to maintain consensus, appearance, and reputation. And lastly, Save and work hard. This concludes the basic information about Japan. Let us now turn to the advantages and disadvantages of doing business in or with Japan. Okay, let's first look at the main advantages of doing business in or with Japan. Twenty years ago, Japan fell into a state of stagnation and economic recession, but in recent years, due to the reforms of the Japanese government, the economy has revived and will gain momentum soon.
Japan is an attractive investment destination because it is one of the largest consumer markets. The key indicator of this is the fact that Japan's GDP is the third-largest in the world. Japan also ranks first in the world in research and development spending per capita. This means that Japan is a good place to locate high-tech manufacturing. The infrastructure, communication systems, and transportation systems in Japan are also top-notch and very convenient for businesses to reach. There are many opportunities for the Japanese market for new trading and reselling companies.
One idea I would like to point out is related to the aging Japanese population. This means that products for old and elderly people are in great demand there. Let us now consider the main disadvantages of doing business in or with Japan. On the other hand, the rapid aging of the population and low birth rates are currently the main challenges for Japan in terms of domestic factors. Currently, Japan is struggling to cover the rising cost of social security due to the increasing number of elderly people.
The cost of entry for companies is very high, as the cost of accommodation and travel is similar in Japan to the EU or America. Technically, Japan has very strict regulations, so the quality of goods exported to Japan must be guaranteed. This is a notable obstacle for companies exporting to Japan from abroad. Furthermore, when setting up a representative office in Japan, it is difficult to recruit Japanese engineers and workers, especially IT engineers, because the salaries are very high.
English is also not a common language among the Japanese, so you will need to provide translators or learn Japanese through self-study. In addition, the current tensions and trade war between the world's two largest economies, China and the US are negatively impacting major Japanese export and import companies. Additionally, deteriorating trade relations between Japan and South Korea have hampered Japan's export activities to Korea.
Now that you know the Japanese market and its peculiarities in general. Let us now consider my recommendations for new entrepreneurs in Japan. Direct import and export business requires a considerable amount of capital, and you need to invest in goods and warehouses, personnel, and inventory. If you are not financially strong enough or cannot find investors, you can start in the service sector. Or why not start as an export-import agent in Japan.
As an agent, you can work as a solopreneur with minimal investment. This is currently a very lucrative form of business that is becoming increasingly popular. As an agent, you can match Japanese suppliers with foreign buyers or vice versa. You can collect a commission for each deal you help close.
When you start a business or do an import-export business in Japan, the most important thing is to maintain your reputation. In the Japanese business world, some companies offer evaluation services that assess a company's reputation and capabilities and based on this data, partners can decide on a suitable collaboration. Therefore, especially for young companies, care must be taken to ensure that deliveries are made on time, promises are kept and payments are made in a disciplined manner. The legal environment for businesses in Japan is very clear, does not cause any difficulties, but in return requires you to live and work according to the law." The Japanese are generally afraid of change and reluctant to try new things if the old ones still serve them, so they are very loyal to their domestic products.
Therefore, choosing a good and "right" product to export to Japan is very important. New and fresh entrepreneurs who want to start an export-import business with Japan or in Japan are advised to seek the help of local consultants and agents. Let us now look at Japan's main export products. If you are interested in choosing the right product to export from Japan, this chapter will give you ideas and insights. The following categories are the major export categories and everyone should take a closer look to select a particular product for export.
Also, take a look at my video on how to choose the right products for export. You can find the link somewhere here. Automobile Japan is still the world's second-largest exporter of automobiles after Germany and is striving to improve. Japanese auto exports have declined slightly in recent years after years of growth. One reason is labor costs, which are relatively high and rising.
In addition, the yen currency is often volatile, leading to a decline in exports. Electronic components The Japanese electronics industry is the largest consumer electronics industry in the world, although the market share of these Japanese companies is declining due to competition from South Korea, Taiwan, and China. Japan has companies that manufacture televisions, camcorders, audio and video players, etc. The Japanese electronics industry has maintained its dominance in the market compared to the United States and has maintained its export strength in this sector due to the high reputation of the electronics industry. Industrial Machinery Japan is one of the most developed countries in terms of machinery. Japan's automation industry is known in the world for its high-quality machinery manufacturing brands.
Japan is a country with strengths in the field of CNC machines because this country has manpower that is well versed in the automation of industrial machines. Japanese brand machines are widely known, especially in Europe. The United States is also emerging as a major importer of Japanese industrial machinery. The increasing global demand for machinery and robots is opening up opportunities for production facilities in Japan. Thanks to the quality of machines made in Japan, buying old CNC machines is also very popular.
Old machines are usually purchased by small businesses around the world. These are companies that have a small budget to invest in production. Of course, the quality is not as guaranteed as to when buying a new CNC machine. Japanese shipping industry From the nineteen fifty’s to the beginning of the twenty-first century, Japan and South Korea were the two leading countries in the above three indicators, but since two thousand ten, China has taken the lead in the shipbuilding industry.
Japan currently has more than one thousand one hundred shipyards. Semiconductor Components The technological revolution in the field of semiconductor components in the nineteen eighty’s led to a rapid improvement in the quality and functionality of Japanese electronic products. By the mid-nineteen eighty’s, Japanese companies had become the world's leading suppliers of semiconductor components.
Leading the industry are three manufacturers of telecommunications equipment, three electronics manufacturers, and four manufacturers of consumer electronics. Steels and metals Japan exported about two-point sixty-seven million tons of steel in two thousand eighteen, down fourteen point seven percent from the same month last year. Compared to August two thousand eighteen, this amount decreased by twelve-point eight percent. This is also the first time since April two thousand eighteen that the country's monthly steel export volume fell below three million tons. So let us take a look at Japan's main imported products.
This chapter is for those who want to start importing products to Japan, or for those who are looking overseas for the right product to export to Japan. I will list the major product categories here. Japan has a diversified industry and a high standard of living. Therefore, the demand for imported products is also broad with various kinds of goods. Seafood Japan is the second-largest importer of seafood in the world after the United States, the leading importer in Asia, and also the country with the highest per capita consumption in the world. The Japanese celebrate hundreds of festivals and almost every festival has one or more seafood dishes.
The Japanese market is very important for the manufacturers of shrimp products with added benefits on Southeast Asia. In two thousand eighteen, Japan imported one hundred thirty-nine thousand tons of shrimp from ASEAN countries worth one point forty-six billion US dollars, accounting for sixty-seven percent of the volume. Those who export seafood to Japan must follow the technical hurdles set by the Japanese government to control the goods imported into this country.
Compared to other countries, the technical hurdles imposed by Japan are much stricter due to the consumption characteristics of the Japanese market. Rice The domestic prices of rice in Japan are increasing, causing consumers to switch to the cheaper imported rice. Rice imports are strictly controlled in Japan.
However, with more supermarkets and restaurants offering cheap imported rice, foreign rice producers are expecting to turn to Japan to expand their rice market. Plastics The annual import demand for plastic products in Japan is about eight billion US dollars, making Japan a potential market for plastics exporters. Shortly, products that traditionally used materials made of glass, wood, and paper, such as bottles, jars, cabinets, etc., will be replaced by products made of plastics.
Therefore, to sustainably develop the plastics industry and export business, companies need to adopt a strategy of investing in modern technologies, product research, and exploring potential markets. Tea During two thousand ten to two thousand fourteen, Japan spent about one hundred to two hundred million on the import of tea. In two thousand fourteen, Japan ranked ninth in the world with one hundred eighty-nine point sixty-two million US dollars, down two-point eighty-five percent from the same period in two thousand thirteen. China, Sri Lanka, and India are the top three export markets for tea to Japan, accounting for eighty-five point five percent of the country's total tea import sales. Ceramics Japan has a special fondness for glazes, tri-colored ceramics, table flower pots, ceramics for tea drinks.
The Japanese market prefers thin, lightweight ceramics in compact sizes. Thin ceramics are always the first choice of importers. According to the Japanese Industrial Standards Act, "products with Ceramic Ware Safety Mark" are tested for the lead content of their products when exported to Japan. Wood The demand for wood pellets in Japan arises mainly from the reduction of dependence on traditional fossil fuels as an energy source.
Japan is expected to build forty-three high-efficiency power plants in the next ten to twelve years. The large expansion of power plant capacity is a boom for biomass wood pellet manufacturers. As the stringent emissions requirements for these new thermal power plants will almost certainly increase demand for wood pellets.
Japan requires that all imported wood pellets be certified in Forest Management, So these are the main export and import products of Japan. Now I would like to introduce business ideas with high potential for small export-import businesses. You may be wondering with small and medium capital, are there any small export-import business ideas regarding populous Japan that can be implemented and still make big profits? Of course! To there are and in the following list I give you many ideas to consider for your future business. Japanese Cosmetics Business Besides Korea, Japan is also a producer of cosmetics trusted by all Asian countries. Excellent products imported from Japan such as lotions and essential oils are very popular in China, Vietnam, Thailand, and Laos.
If you import Japanese cosmetics, you do not need to prepare big capital when doing business online or offline with high-quality cosmetic lines, from high-end brands to affordable brands from Japan. With a great attraction to Asian customers and a good marketing strategy, you can make a profit that is many times the amount you spend. Japanese clothing business If you understand the fashion trends of the target customers you want to reach with your brand, and have the know-how to match the flow of domestic Japanese goods, you can increase your profits significantly. Japanese fashion is famous for its elegance and high quality.
E-commerce Starting an e-commerce business is considered a safe option because if it fails, it does not cause huge investment losses and e-commerce works like other traditional business forms. There are many ways to start an online retail business. Start with products that fill an essential need, with innovative products. With today's consumer habits, consumers look at products online before deciding to visit and make a purchase.
Import-Export Agent or Agency in Japan Do you live in Japan or are you very familiar with the country? Then you have a great opportunity to start your own business as an export-import agent. You can help foreigners find local customers and earn a good commission income in the process. Or you can help Japanese exporters find overseas customers and earn commission in the process. As an export-import agent, anything is possible. So let us take a step-by-step look at how you can start an export business to Japan. Once you have selected and validated the product you want to export to Japan, the following step-by-step action plan will give you a framework for actually starting to export to Japan.
Goods exported to Japan are subject to a strict legal system for reasons of protecting national security interests, economic interests, or ensuring food safety and hygiene. If you want to enter the Japanese market, you must thoroughly understand and strictly comply with Japanese import laws and regulations. Before you start exporting to Japan, you should always make sure that your product complies with Japanese regulations and requirements. You can follow these steps to start exporting to Japan. Step One: Create the export business plan Developing an export plan is a prerequisite for a good export strategy and is very important. It helps you seize opportunities and minimize risks.
It also helps you organize and set up a logical plan of action. The content of the plan can vary, but it should include only the relevant and important issues of your business. Step Two: Selection of goods for export to Japan.
To know whether a product is suitable for export to Japan, you need to know the needs of Japanese people in terms of products and consumption, understand the specifications of type, size, price, season and taste, and the consumption habits of each region. In general, most Japanese consumers like high-quality and affordable goods with attractive designs. English is not widely spoken in Japan, so translate the name of the item into Japanese if possible. Goods requiring import permits must comply with customs procedures, regulations, and laws.
Step Three: Search for traders, importers, customers, and partners To export goods, you will need to find a partner as you explore the Japanese market. There are two types of partners you will need: Traders or customers. When choosing distributors, you should be guided by the following characteristics: Reputation in the market, length of time in business, financial capacity, technical equipment, distribution networks.
If you want to sell only to retail customers, you also need to understand who your customers are. What is the value of your product or service to its customers? Step Four: Sign the contracts To enter into a sales contract, exporters and traders must go through the process of negotiating and signing contracts. However, many export companies have reported that their purchasing partners have not strictly adhered to the signed contracts for payment. Many companies are confused when it comes to resolving trade disputes in import-export activities, as I described in past steps. There, are many causes of contract disputes, including subjective and objective reasons.
Many contract clauses are not clearly defined and are not carefully reviewed by companies before signing. In addition, there is limited awareness of contract law. Therefore, to avoid risks, you should find ways to find out whether your business partner is trustworthy or not. One way to look for a business partner is to seek help from the Japanese Chamber of Commerce. Step Five: Apply for a license to export goods.
Some countries strictly enforce export licenses. So you need to know your country's regulations to determine whether or not you need an export license, and to determine if your item meets the criteria and conditions for export. You cannot ship your goods without an export license.
Step Six: Prepare the goods for export After you receive the advance payment from the customer, you should start preparing the goods that meet the quantities and requirements specified in the contract. After booking the container, take the packing containers and check the goods twice before sealing them. At this step, please make sure to carefully check if the container has any cracks or damages as it will affect the safety of the cargo.
Step Seven: Pack the export goods and mark the codes of the goods carefully. You can work with the technical team and factory workers to seal the goods in the warehouse. Pay special attention to the pallets and choose the right type, the right size, the number of layers of cartons you pack according to the importer's regulations, mark the symbols and print them on each package.
Most LCL goods need to be marked with shipping labels. Packing at the port is much more complicated with the paperwork and you need to have it checked by the inspection staff. Step Eight: Check the quality of the cargo Before delivery, you are required to check the goods for quality, weight, packaging, etc. This is an important task as it ensures customer benefits, avoids untimely negative consequences, establishes the responsibilities of production stages, and creates sources of goods that ensure the prestige of exporters and manufacturers in trade relations. Inspection of export goods is carried out immediately after the goods are ready for export packing at the inspection facility. At the border inspection post, the goods are inspected directly by the customer or by a competent body, if both parties agree.
Step Nine: Purchase cargo insurance. The transportation of export goods often involves risks. Therefore, purchasing export cargo insurance is the best way to ensure the safety of export goods during transportation. You can contact some insurance companies to get insurance for your shipment. Usually, the price of insurance depends on the value of your goods.
Step Ten: Customs procedures and documentation To export goods to Japan, you must declare information to the General Department of Customs and apply for an import permit after you have completed a goods inspection. The cost of the inspection is approximately five thousand Japanese Yen. After the inspection, an import permit is issued to the importer. The cost of each copy is about four hundred Japanese Yen. If registered online, the cost is about three hundred Japanese Yen, currently, ninety percent of import procedures in Japan are done by computer. Step Eleven: Delivery on board.
After you have completed clearance of the shipment, your next task is to add billing information for the shipping companies to the bill of lading. Shipping containers on board is the shipping company's responsibility. This step ends with the need to obtain a bill of lading, which may be the original (3 copies). Step Twelve: Payment modalities Payment is an important and final step in all export transactions.
The choice of international payment arrangements directly affects the interests of exporters and importers. When preparing import and export transactions, the buyer and seller must agree on and select an appropriate international payment method. Therefore, in import and export transactions, you need to know the international payment methods to apply them appropriately in the work process. So that makes it clear how you can start exporting to Japan. Now let us look at how to start an import from Japan, step by step. The steps and instructions mentioned in this chapter will help you start an import business and especially importing goods from Japan.
I assume you have already clarified what product you want to import from Japan. Japanese goods have long been known for their good reputation, quality, and impressive design. At present, consumers in the world are increasingly interested in the quality of goods, so Japanese goods are always preferred.
Currently, there are many ways to get Japanese goods in your hands. These ways have their advantages and disadvantages, depending on the needs that you should take into account to choose the appropriate import method. Step One: Apply for the import license If you want to import goods yourself or even a shipment from abroad, you must first apply for a business license to import the item. If you do not have a license, you can contact goods import service providers, customs services, and customs agents in your country to sign a contract to import the goods from abroad. Step Two: Find reputable companies to order goods from To ensure safety and low risk, you can work with bigger, reputable, and long-standing companies, then you will have fewer risks and other problems during the import process.
Choosing the right product to import is no less important than choosing the right supplier. You can make a list of products that are in demand in your country and research online to compare the prices and contents of each product. Step Three: Sign up for special checks Depending on the country, importing may require special testing of imported products. Most focus on industries such as cultural, health, animal and plant quarantine, food safety testing, motor vehicle registration, etc. Therefore, to avoid the hassle of importing goods that are not allowed to be marketed in your country, before you decide to sign a sales contract, ask the partner to send the product samples and register with the registration office for testing.
Step Four: Sign the import order Once you have identified the goods to be imported and selected the correct supplier, the next step is to submit a purchase order, usually via email or other online forms. Step Five: Sign a contract, schedule the time for transporting the imported goods to your country When the seller confirms the orders, both sides can sign the contract. To ensure the safety of the imported goods and prevent any problems that may cause trouble in the future. Step Six - Packing of goods, delivery at seaport or airport You will need to track the process of packing and delivery of the goods at the port, such as the time of packing, the cost, and the duration of transportation from the factory to the port. This tracking can be done through websites or direct contact by phone, email, and other forms. In any case, ask the supplier to provide photos and videos of the packing process.
Step Seven: International freight transport by sea or air Your shipment is sent by air or sea. Step Eight: Payment of the imported goods The payment deadline is based on the purchase contract signed between the two parties. For international payment, you must prepare the payment according to the information in the contract. Step Nine: Customs procedure for imported goods When clearing customs, you first proceed to the customs declaration after the shipping company has sent a notice of arrival.
In the customs declaration, you need to fill in the information. All kinds of codes like port codes, type codes, customs codes, and many other details. You need to prepare carefully and fill in the information.
If you are filling the customs declaration for the first time, it is best to take advice from experienced people to avoid wrong or missing information and time-consuming and unwanted system errors. Step Ten: Receiving the delivery orders After you open the customs declaration, customs will check to see if your goods are listed on the contract, invoice, packing list, as well as bill of lading. If this is the case, customs will release the goods and you can transport them to your warehouse. Depending on the item, be prepared to pay import duties, Value Added Tax, and other taxes after a certain period. In some cases, there are additional environmental and excise taxes depending on the laws of the country.
Once the import process is complete, you can start selling the goods and make a profit. Well, that concludes my video for today. We have talked about how you can start an import-export business in Japan.
The procedure for importing goods from Japan seems to be quite complicated for newbies. So do not hesitate to learn from experienced people. Gradually, you will become a master of importing.
Congratulations! You have officially learned how to start an import-export business in Japan. Start booming now and make the world your business! Now I would love to hear your thoughts. I want to make sure you understand this and can prove it to me. I want you to do a couple of things for me. One, give me a thumbs up. And number two, comment below.
And if you want to learn more about international trade, you can watch videos on my YouTube channel here. Do not forget to subscribe to my channel and hit the bell for more quality content about starting or growing your import-export business. So go out and do some business, be confident and realize that you can export and import at the same time. I have some good stuff here that you can check out to learn more about international trade and business. Keep going. Stay safe and stay healthy. Goodbye