Interview: Business Set-Up in Japan

September 10th, 2012By Category: Starting a Business

1. Could you give a brief outline of the type of business you operate in Japan?
Platinum Training Consultants K.K. specializes in cross-cultural training. We help staff at Japanese companies to adapt to the challenges of working in an increasingly global environment. This covers aspects of leadership, communication and soft skills such as conflict management, meeting management, teleconferencing and presenting. We also work with foreign assignees to Japan to help them overcome the cultural differences associated with working here.

2. What do you see as the major difficulties for an ex-pat to operating a business in Japan?
There are a lot of cultural differences – which is the reason we set up Platinum in the first place – and these manifest themselves in various ways.
On a very practical level, bureaucracy can be rather frustrating in the sense that failure to get documents EXACTLY right can slow things down badly. Things like company set-up, articles of association, tax and even seemingly trivial issues such as changing address really can cause problems without the correct expertise. Whilst this kind of paperwork is difficult for foreigners as few of us manage to reach a sufficient level of kanji proficiency, it’s also quite tricky for Japanese people too. Working with Shinonome on this was invaluable.
After setup up, I think the most frustrating aspect can be the relative conservative nature of Japanese companies, and the reluctance to deal with new suppliers. Business relationships take longer to develop and from time to time you can feel as though you’re banging your head against a brick wall.

3. What do you find are the benefits?
The flip-side of the relationship issue is that Japanese clients tend to be very loyal. Having established your credibility and built a good relationship over time as a trusted vendor, clients will tend to favour your company for new service offerings rather than use another – possibly cheaper, or better – unknown vendor. Showing respect to this aspect of Japanese culture can reap significant dividends in the long term.

4. You incorporated a Kabushiki Kaisha (KK) as your business vehicle. How was this advantageous to you?
When we started we aimed to work with large Japanese and multinational companies. After taking advice from Shinonome we felt that the KK option, despite the increased cost and administration, lent us a certain amount of credibility. It demonstrates a level of commitment and indicates from the beginning that we’re a company, not a cottage enterprise. It also marks us out as being Japan-based, which we felt was important as the company founders are committed to being in Japan for the long-term.

5. Based on your experiences, do you have any suggestions to other ex-pats considering to start a business?
If you are sure that your business idea is a good one, then you should press forward as soon as possible. Furthermore, it pays to get proper advice on the best way to structure your business. Skimping on this may seem like a good cost saving in the short-term, but will undoubtedly lead to problems in the mid-term. Getting good professional advice allows you to spend your time focusing on what you are good at, rather than wading through forms that you don’t properly understand.

Please contact us for more details.

Author of this article

Shinonome Group

Shinonome Group provides counsel on a range of matters including business and commercial, immigration and visa, real estate, and estate planning and administration issues in Japan. Our goal is to achieve workable solutions quickly, accurately and professionally. We possess both the business knowledge and the legal expertise required to successfully handle a wide spectrum of issues.

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