How to conduct business with the Japanese: case study of inward FDI in Japan

Abstract

For economic re-vitalization, the Japanese economy is required to attract more inward foreign direct investment (FDI), which brings new technologies and know-how, promotes competition, and raises employment. The Japan Team conducted in-depth interviews in five firms from ASEAN and South Asia. Questions were asked regarding years since the the Japan office was established, how they started the business in Japan, business objectives, competitiveness, public support they received, and problems they face. Since Japan was the second largest market in the world, they targeted the Japanese market to enter. Even if the firms were small, they had clear global strategies about where to invest. These companies had competitiveness to conduct business in Japan, in particular to satisfy the high level of quality. The problems they face in Japan are related to traditional Japanese business practices such as long-term relationships among Japanese industrial groups. Japanese firms had already established strong and closed business ties, and it is difficult for foreign firms to enter, even if they have better technology. To invest in Japan, JETRO and other organizations supported them under the ‘Invest Japan’ programme. Although the firms interviewed acknowledged the merit of these supports, more information on know-how regarding conducting business with Japanese firms is desired.

Keywords:

• inward FDI
• long-term contract
• obstacles of business
• global strategy
• Invest Japan

Notes

1 The descriptions on the company are based on the interview with Mr Jo Ando, Marketing Manager, Infosys Japan in January 2013. The authors appreciate his cooperation. All errors are ours. See also its homepage indicated by (a) in References below.

2 The descriptions of the company are based on the interview with Mr Tran Xuan Khoi, Chief Executive Officer, FPT Japan, in February 2013. The authors appreciate his cooperation. All errors are ours. See also its homepage indicated by (b) in References.

3 The descriptions of the company are based on the interview with Mr T. Fujita, President of ADY in February 2013. The authors appreciate his cooperation. All errors are ours. See also its related homepages indicated by (c) and (d) in References.

4 The descriptions of the company are based on the interview with Mr Chou, Vice-present, Japan Palm International and Present, Ccilu Japan in February 2013. The authors appreciate his cooperation. All errors are ours. See also their homepages indicated by (e) and (f) in References.

5 The descriptions of the company are based on the interview with Ms C. Yamauchi and Mr Koga, Communication Section, Plenus, in January 2013. The authors appreciate their cooperation. All errors are ours. See also its homepage indicated by (g) in References.