It wasn’t too long ago that people were clamouring over the latest and greatest in Japanese products. Until the debut of Apple’s revolutionary iPhone and the “me – too” competitors that followed, Japanese cell phones were the pinnacle of mobile phone technology bar none. Cars manufactured by Toyota and Honda were held in the highest regard before last year’s blitz of seemingly consecutive recalls. Japan’s dominance over its two staple exports, cars and electronics, was clear as day.
Then it all came crashing down.
We all know the story that followed: lacking innovation and refusing to break the old ways of doing business, Japan Inc. continues to see its market share abroad being gradually eaten away by its much cheaper, more dynamic Asian (and sometimes American) rivals. One by one, the dominoes began to fall. Cornered by falling profits and the perennially strong yen, industry was forced to lay off workers in Japan as manufacturing processes shifted to developing countries. Some companies slashed their parts’ costs in an attempt to recoup their losses, oftentimes at the expense of quality (Toyota is a prime example). Some firms have been forced to extend product cycles so as to minimize the costs of ongoing research and development. What has resulted is an uncompetitive, overpriced and problem laden Japan Inc. abroad; one that has been suffering and continues to suffer if nothing is done to remedy the situation.
Though it is easy to quote active monetary intervention and innovative new products as solutions to Japan’s woes, rectifying the problem through either manner is easier said than done. Rounds of quantitative easing in the fall of last year, for instance, did little to stem the yen’s surge to the top. So what can Japan do to get its exports back into fighting shape?
The answer may lie in exporting products that Japan already has.
Confused? Here’s an example that I’m most familiar with: cars. Visit the Japan site of any Japanese automaker and compare it to their equivalent website in any other country. Though the automotive markets in developing countries like China and India have experienced explosive growth, Japanese automakers continue to offer vastly superior products, with line-ups triple the size of those in other countries, exclusively to those situated in Japan. The plastics found in the JDM (Japanese Domestic Market) Toyota Corolla, for instance, approach Lexus – like levels of refinement in comparison to the Rubbermaid material found in its North American brother. Nissan offers nearly thirty models to choose from in Japan, while those in China are limited to pick and choose from a measly nine. There is often a multitude of customization options open to Japanese customers unavailable to consumers anywhere else in the world. Though the Japanese domestic market remains an important market for any automaker, keeping such exceptional products and services exclusive to a market in decline makes little to no sense at all.
It isn’t only cars; after all, the same could be said for every other sector in Japan. Despite being a massive hit in Japan, Sanyo has yet to announce plans (if ever) to export its GOPAN rice-bread making machine. Cup Noodles, a dietary staple of the average college student, oftentimes taste better in their domestic iterations than their tasteless, plastic textured equivalents sold elsewhere in the world. Though the quality of their notebook computers is notably better than that of laptops offered by American hardware juggernauts Dell and HP, companies like Fujitsu and Panasonic have kept mobile computing solutions exclusively to business customers. And let’s not forget the host of offbeat Japanese items, which could potentially draw much revenue from consumers around the world.
As a country fuelled by and reliant on exports for much of its economic growth, Japan must realize that improving its game abroad is the only way its manufacturing industry will survive at home. The only way that Japan can do this is by offering the same, unique products (of superior quality) available locally to both emerging and developed markets across the globe. Whether Japanese companies decide to do so is another matter, but such is an inevitability that they will eventually have to come to accept.
Photo credit: Dmitry Valberg / Flickr
Comments
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What the Japanese really do well is toilets and bathrooms. Find plumbers out there willing to fit them, and get them exported. People will go mad.
And kimono fabrics. Send them as well.
There are plenty of poor and people starving in Japan – you haven’t been reading the news recently have you?
Inovation has declined drastically in Japan – cannot compete with a small country like Korea these days. You, like many in Japan are living in the past I’mm sorry to say.
bobbert all Japanese that have lived in other countrys think they have a firm grasp on world economics/politics/culture/issues etc but they never do. Just because you have lived in california for three months paid for by mommy and daddy doesnt mean you have insight, in fact your post shows you dont. Japan’s economy has been built on exporting/manufacturing medium quality goods – Toyota, hitachi etc. South Korea, China and other emerging nations are now taking over Japan in producing these goods at a lower cost and better quality. They have accelerating technological advances and Japan aren’t hungry enough anymore just look at todays apathetic youth. Japan is going down big time.
Are these “well-educated Japanese” offering up any BETTER ideas than author?
I agree, this is pretty much a non-article. The author, who admits he has 0 economic training, leaves out the most important factor, cost. A lot of the products he suggests selling abroad are both esoteric and much more costly than a lot of the competing products currently offered in those regions. While they sell well in Japan, it’s obvious the Japanese have different tastes and needs than places like the US and Europe.
This guy is just yet another foreigner who thinks that somehow(by virtue of being white? I don’t know) that he is smarter than well educated Japanese who have lived both in Japan and abroad….. It’s too bad Japan cannot export people like him, if they could everyone could be driving around in solid gold rocket cars. But alas, he’s quite worthless so nobody would want to buy!
Japan is sinking down and none of Japanese approach will be able to save this ship guys,
it is time to say Sayanora to Japan,
no need to try to save these selfish ( wagamama ) people,
it is not our business
“Superior quality”? I don’t think so. I think Swiss watches, Ferrari cars and Saville Row suits when I think of “superior quality.” Japan is capable of good quality, but certainly not superior quality. What’s more, Japan is not all that innovative. There is no Silicon Valley in Japan. Cell phones, the Internet, personal computers, laptops, netbooks, tablets, etc., etc. were all invented in the West. The Koreans can do everything the Japanese can but cheaper. Japan is doomed.
I think the truth probably lies somewhere in between -there are certainly some great products available in Japan that aren’t easily accessed elsewhere, but whether they could turn a good profit overseas is another, and much riskier, question
I think the relatively high cost of manufacturing in Japan, in addition to the much higher cost of shipping and transport, would certainly make for pretty tight and highly risky margins for selling products overseas – particularly when they can be quickly copied elsewhere.
Hey Kenturo I enjoyed reading your post – I guess I am also an idiot gaijin and i don’t agree with everything you say but you are right to point out that the individual wealth of Japanese people is still very high, especially compared to emerging countries like China. I think the article is a bit patronizing and other simplistic.
So while I may be an ‘idiot gaijin’ I am at least smart enough to know that you don’t need, or want, me to tell you how to run things! 🙂
LOL. Have you taken a look at Japan’s debt recently? Good luck buying yourself out of that.
Ays12 you should get job in your own country you cheap redneck fuckface. You jealous that you have to come to superior country Japan for work and woman you loser retrard.
kenturo,fuck your self
So many points left out, really… I think you’re overestimating the popularity of some products, because what is popular and works in Japan sometimes can be a huge failure somewhere else…
I just can’t imagine GOPAN being that popular in Europe, for instance, with so many good bakeries everywhere, and looking at the box-like of the majority of Japanese cars in Japan, do they even look appealing anywhere else?
So many points left out, really… I think you’re overestimating the popularity of some products, because what is popular and works in Japan sometimes can be a huge failure somewhere else…
I just can’t imagine GOPAN being that popular in Europe, for instance, with so many good bakeries everywhere, and looking at the box-like of the majority of Japanese cars in Japan, do they even look appealing anywhere else?
I agree dildo – these stuppid gaijin don’t understand Japan economy. We are still number 3 and very very powerful. we could buy other countries we have so much money. Nobody starving in my area. We are still rich nation and hone of innovation. Rest of country watch while you idiot gaijin suffer!!!
From you writing, I am pretty sure that you have very little knowledge of business and economics. Interesting idea but you have left out (conveniently) some important points.
From you writing, I am pretty sure that you have very little knowledge of business and economics. Interesting idea but you have left out (conveniently) some important points.