Fenetre Partners is a leading consulting firm for market entry into Japan and business development in Japan. We provide our clients with market research, distributor & partner search, B2B business matching, marketing & sales rep and trade support.

Trend of Japanese manufacturers’ global procurement

 In these years, we see some trends of Japanese manufacturing companies on their procurement from overseas companies. This is becoming great opportunities for overseas suppliers to enter Japanese market.

 In the past, Japanese manufacturing companies such as automotive companies, construction machine companies, etc. didn’t prefer importing overseas suppliers directly but used trading companies to have them to import.

 One of the reason for this policy was that they didn’t want to increase the number of suppliers who they directly deal with. On the other hand, its disadvantage of this was that the price of product will essentially increase because trading companies add margin on top of product price.

 However, we see some manufacturing companies now who established overseas procurement department then import directly from overseas suppliers. By doing this, they don’t need to rely on trading companies then can reduce procurement cost.

 With this background, another problem which Japanese manufacturing companies will have is that they have to contact directly overseas suppliers to ask questions about products, logistics, etc. however this is quite much work for them. And as a consequence, even if they want to deal with overseas suppliers directly, they are becoming reluctant to do it.

 So now, the opportunity for overseas suppliers are that, if they have direct contact point in Japan, Japanese manufacturing companies would proactively deal with these suppliers because they can ask immediately contact locally in Japan but can procure products from overseas. Especially, because of the trend of strong Japanese Yen, the motivation to procure from overseas is becoming higher and higher.

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