As the Australian firm would like to sell the product to Japan’s consumers, they have to understand their behaviors which they are mostly prefer high luxury goods with the cheapest price and they also like to purchase domestic product. Hence, Australian needs to make a plan briefly before launching the products in Japan.
JAPAN BUSINESS CULTURE REPORT
1.Introduction
This report is about Japanese business culture that is designed to provide information to marketing manager of Australian manufacturing woodworking tools Company. As Japan’s second largest in world , doing business in Japan is relatively difficult. The report’s purpose that to know the traditional business of Japanese culture which is begins with an overview of the geography, religion, economic and culture of Japan. Moreover, this report has emphasized the strategy of doing business with Japanese that help to approach the overseas market.
2. The origin of Japan
2.1 About of Japan
Japan is located in Eastern Asia between the North Pacific Ocean and the Sea of Japan. It consists of 3,900 islands. The capital of Japan is Tokyo, the populations of Japan are more than 127 million people including Japanese 98% and the rest 2% of the total population is a small groups of Koreans, Chinese, and other nationalities. Japanese language is the mostly used to communicate within the country. Japan has 2 major religions are Buddhism and Shintoism.
2.2 Japanese Behavior and Trend
Nowadays, changing lifestyle of Japanese is to concern more on their health and try to reduce stress by live simplicity and modern lifestyle with natural friendly (user friend). Moreover, Asian consumer products become more popular because of 2 major reasons; firstly is handicrafts developed by combining art that are high value for Japanese. And another reason is using local nature materials that are easy to find in local country.
There is other aspect behavior of Japanese people is late (slow down) of getting married, enjoy the freedom alone and higher divorce rate. Mostly, residential household have just only 1-2 people per house. According to the above the Japanese usually like to send the gift to other to create a warm feeling. So, the woodworking products that made from natural materials will one choice in interesting for Japanese.
2.3 Political Economy of Japan
“Since the Second World War, Japan’s second largest in world after the United States and the largest in Asia” Rice (1995). In 2000, the largest part economy of Japan is service by 67% of Japan's GDP. Then the industry fields, Japan has expert in high technological development by 32%. The last part is agriculture by 1%. Although, Japan has a small agricultural sector but it is self-sufficient food to consumption within the country Rice (1995).
As Organization for Economic Cooperation and Development (OECD) had reported on April 2008-09, economic growth in Japan was 1.6 % and shrinking to 1.3 % in 2010.Moreover, Japanese economic, private investment and manufacturing industry had decline to 4.4, 12.1 and 83.9 respectively. International Monetary Fund (IMF) had expected that Japanese economy of and private consumption for Japan will be slowdown.
For the problem of deflation, Japan had set up the policy of interest rate at 0.1% to economic development. From the Japan’s government policy has reduced interest rate that to motivated Japanese or foreign expand more on investment, especially in industry field (Office of Industrial Economic, 2010).
3. Japanese business Culture
Nowadays, Japanese have dominated the global market because of everywhere can be see Japan product, many kinds of product whether they are basic electronics product or high technology products. However, it’s very difficult for foreign country to put on Japanese market and operate within Japan. So, the main factor that should to concern is culture. As Japanese culture influenced from European, Asian, Chinese and North American Culture, so it is unique and distinguishing from the other Maher & Macdonald (1995).
3.1 Japanese Communication Style
3.1.1 Face to Face
According to Bacarr (1994) had described that Japanese like to do business face to face not over the phone, especially if the caller never makes an effort to meet them in person and develop a relationship. The point is the Japanese rely more on human relationship than the law or legal rights and obligation. So, Japanese face is the most important because it is the image shows the action to others that Japanese business people to earn trust on face to face of potential partner and also true within company structure.
3.1.2 Nonverbal communication
“The best product, the best research, and the best network in the world may all go for naught in the Japanese market if you are not really good in communicating with your Japanese contracts in the appropriate cultural context. And this is the area in which most Western businesspeople, particularly Americans, are the most likely to fall down” Mente (1993) and Kameda (2001).This means that the communicating is very important but between the Japanese and foreigners doing business in Japan the communication is the major problem.
“The beginning and the end of almost everything the language is result of misunderstanding and problems” said by Mente (1993). Also Moran, Harris & Moran (2007) quoted that Japanese language is complex, subtle and predictable. By the time, only a small percent of foreign business people can speak Japanese language while Japanese business people generally speak just fair English. It means that language (silent language) is the one culture that can use to communication among the parties to be more understand. Therefore, sometimes in communication nonverbal is more important than verbal. This nonverbal communication is based on facial expression, body movement to communicate with body language.
3.2 Japanese Negotiation Style
3.2.1 Group decision making
Cateora et al. (2009) said that the different in business negotiation is the cause of different in culture of different countries. The goal of negotiation of Japanese, Chinese, and other cultural groups in Asia are consider in create relationship between the two way negotiations; one is the opposite party to the transaction and another one is people who relevant in organization rather than making decision by a single person McAlinn (1996).
In every countries the basic element of business negotiations are related to product such as price and terms, services associated with the product and friendship between sellers and customers. But the most important when negotiating is complicated and increase risk of misunderstanding. So, there will be take long time to answer.
3.2.2 Emphasis on the Relationship
As, Japanese relationship are group oriented instead of individualistic. According to McAlinn (1996) had suggest that in the negotiation, the Japanese emphasized on build up long good human relationship when doing business by establish relations based on sincerity and trustworthiness. The result of on the training job in the Japanese company has been focus on build relationship and learned to work with the boss in order to make the team success.
For example, Matsushita was the first corporation to have company song and to institute the organization experience for the employees. The company had provided 2 kinds of training; the first one is basic skill for the jobs and another one is fundamental of company’s value. As the training made the employees can be work well within the team and also success in the global marketplace. Therefore it concluded that it is very important for employees in Japanese companies are required to create good relationship to society.
3.2 Japanese Timing
Bacarr J (1994) has indicated that the majorities of Japanese business people are punctual and need time to make proper connection and take time to get agreement from group decision. Japanese essentiality are puncture when doing business with Japanese should be arrive at least five minutes early before work starting time.
4. Marketing in Japan
As an Australian firm want to sell product woodworking tools to consumers in Japan, firstly the marketer have realised that the local value in the Japanese market. From Lee (2008) describe that Japan market; mostly Japanese consumers prefer “high-end luxury goods”. Moreover, they prefer to purchase domestic more than foreign product Milner (1996). So, it can be concluded that to response quickly change in Japan market Japanese concerned on the high-quality standard product which is cheaper price and they prefer to use the product that produce from domestic companies.
5. Consequence of Japanese Partner
Not only Australian enterprises are begin to make investment in Japanese market but also Japanese companies are increasing looking for partnership opportunities overseas that on the top list was Australia. That is a good opportunity to expand product of woodworking tools where Australia product coming to Japan market while Japan is a country that prefers to use wood in architecture and built-in furniture. So, it can be shows that the influence on wood business very important for Japan. Moreover, Japan is going to expand their market as well especially industrial market.
As the same need in market expansion between Japan and Australia so they can be partnership in business. Japan companies can expand their business in industrial market as Australia can penetrate Japan market by Japanese partner that’ll make Australia enterprises can do business much easier in Japan.
6. Conclusion
This paper has concluded overview of Japan business and people culture that’s so important in doing business with Japan enterprises and penetrating Japan market. If Australia enterprises want to penetrate Japan market, it’s easier if they have Japan partners because Japanese people prefer domestic product to foreign product. In communication with Japan partners need to concern in human relationship, face to face communication and group decision making (collectivism) is the culture of Japan. In contrast, for Australian the authority to make by individual the ending decision is leadership. They are the main factors that Australia enterprises should concern because misunderstands in communication and culture can affect to the result of business dealing.
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