Are you a small or medium sized business looking to export to Japan?
We offer a low-cost, low risk, high return solution for Japan Market Entry.
About the Author
Originally from the UK, Des arrived in Japan in 1993 and started his first business there in 1998.
Since 2007, Des has run a natural health products import business based in Osaka which includes selling on Amazon Japan, Rakuten as well as wholesale channels.
“There are so many misconceptions about selling to Japan. One of the first is that you need to break the bank in order to get started. That is not necessarily the case. Having met with many business leaders who, despite success domestically, were rather in awe of exporting, I came up with a practical solution where businesses can leverage our existing network – our first class warehousing and Customer Support Centre centrally located in Osaka and benefit from our management team’s 10 years of expertise in dealing with Japanese import customs regulations.”
Des currently resides in Australia’s Sunshine Coast where, as well as exporting Australian health products to Japan, China and Hong Kong, he is passionate about helping other businesses enter Asian markets.
“It sometimes feels like you’re walking hand in hand with someone into a darkened room and just switching on the lights for them, showing them where everything is, how it works and that it’s not all that complicated after all.”
SUKIRI Pty Ltd
I want to sell to Japan but have never exported before, don’t speak Japanese and don’t have a clue where to start.
Well, that’s why you’re here on this page reading this. It’s not rocket science and we’re here to take away the mystery.
When people learn that I’ve been doing business in Japan for almost two decades now, one of the first questions I’m asked is…
“What sells well in Japan?”
…and I always give the same answer…
“Well, what sells well here (in your home country)?
If it’s a good quality product and popular in the West, it’s more than likely to sell well in Japan.”
And people get that and instantly, already some of the mystery about Selling to Japan has been dissolved.
So OK, maybe that’s rather simplifying the answer and not giving the question its full respect. Of course, some products sell really well in Japan; health and beauty products, tech products, pet goods, to name a few but my point is that we’re not that different as a people. Take away the superficial differences in language and culture, only absorbed by growing up in a particular society, we’re all very much the same.
Back in the 90’s, when living in Japan full-time, I was always fascinated by the differences in fashion, food, gadgets, you name it, between those in Japan and the West. I’d be using a tiny state of the art fliptop cellphone only to have to rent a “brick” on a trip back to Europe. It seemed ludicrous that the West was so far behind. And then witnessing trends one year in Japan be they Pokemon, platform boots, you name it, only to see the exact same trends come in 2 or 3 years later in the UK. It worked both ways. Western imports such as supplements, cosmetics, kitchen tools, etc. would sweep through Japan but it was the time lag of several years that was always fascinating.
Now with everything online, trends and brands are global almost instantaneously. Anyone who’s travelled the globe in recent years will despair at how generic the planet is becoming.
So back to my point:
What sells well in Japan?
Japan likes and expects…
- I could repeat it again
- ORIGINALITY – things that are “new”
- QUALITY PACKAGING & PRESENTATION
- COOL FACTOR
- CUTE FACTOR – if your product or brand has a cute, cuddly factor, all the better. Japan does “cute” like no one else and why not!
- CUSTOMER SERVICE
- CUSTOMER SERVICE
- CUSTOMER SERVICE
- you get the point
Asia Market Entry: JAPAN FIRST
Your Japan Success Story
Japan is the region’s trendsetter. It is the country many other Asian countries such as Korea & China still look to for up and coming products, brands, new trends.
If your product is selling in Japan, it will immediately increase interest from buyers in other countries in the region. So if you’re considering exporting to Asia, Japan is a great place to start.
The Traditional Export Route
Find a distributor for your product and sell to them wholesale. Sure, but how? It can certainly be done but Japan is a tight wholesale market. You have the “uber” wholesalers and then a myriad of middlemen before the end user.
Find someone online? Who can I trust? Trade fairs in Japan? Sure but that’s a huge amount of effort and investment not only financially but in time and manpower and no guarantee of success. And no understanding of the business culture or language can be a huge hurdle.
Even if you do find a distributor, there’s no guarantee they’re going to invest in promoting your product and make a success of it. You may just be one of thousands of brands in their portfolio.
Typical Wholesale Margins
Take the following example; let’s say your product retails for $100 per unit.
Retailer / Wholesaler
Will expect at least 50% margin so your wholesale selling price would be at most $50.
Note most Japanese retailers will only accept consignment orders.
Will typically want 20-30% margin so your selling price to a distributor would need to be $20 or $30.
They will likely demand exclusivity tying you into a contract for several years with an unproven partner.
SELL direct to the Japanese public via Amazon Japan
Why Amazon Japan?
Here are just a few reasons why we recommend Amazon Japan for initial market entry for overseas SMEs to Japan;
- Account setup is very easy and can be done in English
- The admin panel / support pages can all be viewed in English
- Low cost monthly fees (4900yen/mth)
- Amazon pays you sales revenues every two weeks direct to your overseas account
- Selling direct to the end user maximises your profit
- Consumers love to buy direct, no middlemen
- You maintain 100% control over your brand messaging
Amazon Japan has an order fulfilment service called AMAZON FBA (Fulfilment By Amazon).
Amazon FBA offers;
- Same day, next day delivery
- Scheduled delivery in 2 hour bands
- Cash on Delivery Payment Option
- Customized gift wrapping for Japanese seasonal events
Anyone who is serious about succeeding in the Japan market should be looking to offer their Customers this level of fulfilment.
IMPORTER OF RECORD
In order to import goods into Japan, you need an Importer of Record which has to be a registered Japanese corporation.
We act as your Importer of Record. Our corporation in Japan has been importing from around the world since 2007.
As the importer, under Japanese law we are liable for your products. Note your brand will be covered by our liability insurance at no extra charge to yourself.
Setting up your store on Amazon Japan
You provide us with your product and brand information, images, etc. via email.
Our native Japanese staff translate and build your product pages on Amazon Japan, optimizing text for search engines.
Your online store is up and ready to sell to 127 million Japanese shoppers.
Stocking your shop: Ship to Japan
You prepare, pack and dispatch your goods to Japan – with the correct paperwork we provide.
We deal with Customs taking care of all necessary paperwork and receive your goods at our warehouse in Osaka, central Japan.
Quality control is then carried out. Japanese product information labels are added to every product in line with Japanese law. Then the shipment is prepared for Amazon FBA*
We ship your goods direct to Amazon’s FBA Warehouse ready for sale. Your shop is now fully stocked and ready for business.
*AMAZON has notoriously strict guidelines for receiving product including correct labelling, barcoding, the way products are packaged, separated by batch numbers, expiry dates, etc. Anything not right will result in product being returned. Our warehouse staff ensure product is FBA ready.
Orders come in to your site. Amazon send payments direct to your designated bank in your home country every two weeks. This is excellent cash flow for SMEs.
We take care of all store management and Customer Support for you, offering both telephone and email support. At any given time, six of our highly trained girls based in Osaka are at the end of a free dial (toll free) number.
Sounds great: How much does this cost?
AT A GLANCE
Set Up Cost: AUD$1202 (USD930, GBP715, EUR795)
for a fully functional Amazon Japan store with 1 SKU, stocked with 100 units*
Lead-time: 3-6 weeks
Ongoing Monthly Costs: AUD$99 (USD75, GBP60, EUR65) + 10% of gross sales / per month
Fully managed Amazon Japan storefront with Telephone and Online Customer Support plus Product Liability Insurance.
*Any amount of starting stock is acceptable but we recommend at least 100pcs per SKU.
Step 1: PRE LAUNCH
Initial Setup Fee
YOU: Provide a full understanding of your brand and products.
Cosmetics / Food & Drink Products / Supplements / Kitchenware / Pet Food: $1500 one-off setup fee
All other products: $499 one-off setup fee
Translation of all paperwork and submission for Customs clearance. Process paperwork on your behalf to gain import permits for each SKU*. For certain items (e.g. food & beverages), a full ingredient list and manufacturing process will be needed.
YOU: Provide any information and clarification requested by Customs and/or Japan Government in a timely manner.
TIMEFRAME: 2-4 weeks
COST: $75 per SKU
*SKU = Stock Keeping Unit. SKU is a unique numerical identifying number that refers to a specific stock item in a retailer’s inventory or product catalog. So if you were selling a watch that came in black, brown and silver, that would be one product but a total of 3 SKU.
Lab Safety Testing
If applicable (some foods, supplements, all cosmetics)
Creation & translation of product labels in line with Japanese legal standards. Submission to Japan Government for approval.
YOU: Provide product information.
TIMEFRAME: 1-3 weeks
COST: $99 per label (SKU) – discounted for similar product labels
Step 2: LAUNCH
Amazon Japan Account Setup
We can set up an account on your behalf but recommend you do it yourself.
YOU: Set up a Professional Seller’s account on amazon.co.jp
Create Admin User for SUKIRI
TIMEFRAME: 5 minutes
Amazon Japan Enhanced Brand (A+) Content
Translate and create your Brand Story, a general template for use on all your product pages, highlighting the attributes of your brand and products.
YOU: Provide detailed company, brand and product information including any available media.
TIMEFRAME: 1-2 weeks
OPTIONAL but recommended
Product Page Creation
Translation of individual product pages and optimise for SEO/Keywords. Addition of product images.
YOU: Provide product information + product images
TIMEFRAME: 1-3 weeks
COST: $399 per product page – discounted for similar products
Shipment of Product
Prepare paperwork to accompany shipment, clear products through Customs and receive at our warehouse.
YOU: Ship product from your warehouse direct to our warehouse in Osaka, Japan.
TIMEFRAME: 1-2 weeks
COST: $0.50 per item
Labelling & FBA Preparation
Label your product with Japanese labelling & Amazon FBA label/barcode. Transfer to Amazon’s warehouse ready for selling.
TIMEFRAME: 3-5 working days
COST: $0.30 per label – includes printing & application of label to product.
Step 3: Ongoing
Customer Support & Store Management
COST: $99/month + 10% of gross monthly sales.
Amazon Japan deposits income directly into your bank account every 2 weeks. We invoice you every 4 weeks.
Includes all of the following;
Look after your Amazon Customers & full store management.
Reply to emails regarding orders, product questions, deal with any issues, returns, refunds, etc.
Telephone support Monday to Friday 9am-5pm JST (Japan Standard Time).
Staff will be trained to answer questions regarding your products. Any unknowns will be referred back to you to assist in answering.
Continual updates on potential selling opportunities in Japan; festivals, national holidays, etc.
Oversee product recalls.
All products covered by our liability insurance.
RECORD KEEPING: In line with Japanese law, we keep a record of all batch numbers, expiry dates, quantities, ingredients, manufacturing processes (if needed) in the event of spot inspections by the authorities.
STOCK MANAGEMENT: Replenishment of stock. Full assistance, as and when needed.
NOTE: Any changes to the ingredients or manufacturing process of a product, a new IMPORT APPLICATION will be needed. Also, bear in mind any changes to Japan import laws may warrant a new application.
Creation of Japanese Page on your local website
Sell on Rakuten Japan under our existing Rakuten shop
Wholesale Partner Approach
Order fulfilment for wholesale partners
Sampling (online and offline events)
Affiliate Marketing Campaign
Mama Blogger Networking
Competition / Free Gift Promotions
Groupon Japan Campaign
Event Sponsorship Opportunities
Online / Newspaper / Magazine / TV Advertising
Social Media Campaigns
Trade Fair / Event Exhibit
The following would give you a fully functional, live Amazon Japan shop stocked with and selling:
Number of SKU: 1
Initial Stock Quantity: 100pcs – recommended minimum starting quantity per SKU
|One-Time Setup Fee||1||$499||$499|
|Japanese Product Information Label Creation||1||$99||$99|
|Individual Product Pages||1||$399||$399|
|Stock Clearance through Customs + Quality Control||100||$0.50||$50|
|Label Application: Japanese Product Info Label||100||$0.30||$30|
|Ship from SUKIRI’s Japan warehouse to AMAZON Japan’s warehouse||1||$50||$50|
|Amazon Enhanced Brand (A+) Content ($699)|
|Label Application: Amazon FBA Label ($0.30 per label)|
REPLENISHMENT OF STOCK Quotation
So you’re up and running, orders are coming in. It’s time to restock.
|Stock Clearance through Customs + Quality Control||300||$0.50||$150|
|Label Application: Product Information Label||300||$0.30||$90|
|Shipping from SUKIRI warehouse to AMAZON warehouse (estimate)||1||$50||$50|
That’s a cost of $0.96 per item to replenish 300pcs.
Product to Japan (P2J) Fees
Cost of shipping my product to Japan
This obviously varies depending on the quantity sent and whether by sea or air. Here is one scenario:
|Product to Japan Fees (P2J)||$0.20||based on 1 pallet of 5000 units costing $500 door to door|
|Japan Consumption Tax (8%)||$0.30||based on shipping invoice (wholesale) price of $20 per unit|
|Import Tax||$0||Thanks to JAEPA and other free trade agreements, this will either be greatly reduced or zero.|
So how much profit can I make?
Let’s put all the costs together and calculate the net profit per item. In the following example, your product’s retail price is $100;
|Retail Price for one unit||$100||the price you decide to sell one unit for on Amazon Japan|
|P2J Fees||$1.80||Shipping cost (estimated above)|
|SUKIRI Picking, Labelling & Customs Clearance||$1.10||$0.50 for customs clearance, $0.30 for product label & $0.30 for FBA label|
|SUKIRI 10%||$10||Fee for Customer Support and full management of your Amazon store|
|Amazon Japan 10%||$10||Amazon Japan’s fee. Amazon also charges you a flat ¥4980/mth.|
|Amazon Picking Fee||$1.18||This decreases for very small products|
|Amazon Shipping Fee||$2.69||This decreases for very small products|
|TOTAL NET PROFIT||$73||All yours!|
NOTE: Amazon fees quoted above are accurate as of March 2017 but liable to change.Request a free consultation
Our Management Team
Customer Support Manager
Mr. Kawano, Manager – Osaka, Japan
Our Customer Support Centre
Ms. Kobayashi, Manager – Osaka, Japan
My business is located outside Australia. Can I still sign up?
Absolutely. Where you are geographically is not important. About half our Clients are outside of Australia. We can chat via phone or Skype. Everything else is via email.
What kind of products can I export?
Anything, as long as it is not a prohibited or illegal item. Having said this, at initial consultation, if we believe your product is not suitable for the Japan marketplace, we will advise you so.
Doesn’t Rakuten have the largest online market share in Japan?
Yes, it does but it is losing ground fast to Amazon. Rakuten is expensive and incredibly involved. There are many hidden costs and they only pay out to sellers every two months which for a small business can put a huge strain on cash flow. Average set up costs start around 2 million yen with high ongoing monthly costs.
Having said this, we do have a low cost solution for selling via our existing Rakuten Store. Please contact us for a quotation.
Can you fulfil wholesale orders for us from your Osaka warehouse?
Yes. We are able to clear product through Customs for you and then ship as and when to your wholesale Customers.
How long will it take from when I sign up to my store going live?
Within 4-6 weeks for most products as long as you provide all requested info promptly. Allow 6-8 weeks for cosmetics and some foods.
My products are very expensive and some are one-offs. Can I fulfill from my home country?
Yes. For very high end products or one-offs, such as pieces of art, high end jewellery, etc. we recommend shipping direct from your own warehouse using a reliable international courier such as UPS. We also have an optional plan of fulfilling domestically via our Osaka Warehouse where product is kept in a designated safe. Please contact us for more details.
Can I fulfil orders from my home country, i.e. ship internationally to Japan?
Yes you can but if you’re serious about succeeding in the Japan marketplace, you need to provide a level of Customer Service that the Japanese Consumer is used to. It is commonplace to order a product and receive it next or even same day.
You will probably lose many sales if a Customer has to wait a week or two for it to arrive and many will not be willing to pay high shipping costs.
Also, international shipping can be unreliable. Products can arrive damaged, late or even get lost. The Customer may refuse it if they do not wish to pay import duties and it will be returned to you. You are exponentially increasing the chances of negative reviews being left on your store.
The only exception to this is very high end products or one-offs, such as pieces of art, high end jewellery, etc. where we recommend shipping direct from your own warehouse using a reliable international courier such as UPS. We also have an optional plan of fulfilling domestically via our Osaka Warehouse where product is kept in a designated safe. Please contact us for more details.
Should I ship my products via Sea or Air?
When starting up, Air is recommended as product arrives within a few days and it is easy to manage stock levels. If you suddenly had a spike in sales and found you ran out of a product on a Monday, you could have your store replenished by Friday the same week.
Long-term, once sales are up, you should be looking to ship pallet or container loads via sea freight.
Fees & Payment
Does Amazon Japan send payments to my bank in Yen or in my local currency?
Payments are sent in your local currency not in Yen.
How long do payments from Amazon Japan take to arrive?
To an Australian account from Japan, usually next day. Pretty much most banks should process within 2 or 3 working days.
What currency is your quotation pricing in?
All pricing is shown in Australian Dollars (AUD$).
We are also able to quote in USD, CAD, GBP and EUR by request.
What should my retail price be for Japan?
Obviously, this is your decision but our rule of thumb is around 10 or 15% more than your domestic retail price is fair and takes into consideration shipping costs and tax.
We advise on the pricing of similar products in the marketplace to ensure you have a competitive edge.
Bear in mind that nowadays, a Japanese Customer can search online for your product and would not be happy if they found it selling for much less in another territory.
Should I price myself to be competitive or go for premium?
Cheaper doesn’t mean better. If you have a quality product (and this is key), you can certainly charge a premium for it. As long as you have a “brand story” that backs up a higher cost, then you can charge more.