Turning Japanese: European SMEs' eastern 'Gateway' to new markets

With Japan being Europe’s third largest trade partner, and with the Japanese authorities prioritising energy efficiency in the aftermath of the Fukushima disaster there are really interesting business opportunities for European SMEs in Japan. Business Planet reporter Serge Rombi visited Tokyo to find out more, in this edition of Euronews’ flagship enterprise programme,

Low-energy lighting systems and smart electric sockets are among the high-profile products on display at one of Japan’s main office supplies trade shows.

They are made by a Dutch company, an SME that has broken into the Japanese market after going on three trade missions as part of the EU's Gateway Programme.

Reinder Sanders, Director of Business Development at Plugwise is a Gateway enthusiast: “The EU Gateway Programme supported us in market studies, in exhibitions, and in translating by example business cards and brochures. It was a big help for us.”

Thanks to the trade missions and the suitability of their products to the Japanese market, the Dutch company now has a committed Japanese partner.

Yuji Otsuka, president and CEO of partner firm Otsuka Corporation says there is a ready market in Japan for such technology: “It’s a useful product which we needed, which didn’t exist in Japan. It was a nice opportunity for us.”

Getting into the Japanese market allowed Plugwise to create eight new jobs and a new revenue stream, as Reinder Sanders explains: “We started at around 10,000 euros turnover each month, increasing to 25,000 and 60,000 and increasing now to 100,000 euros, and even more in the coming year.”

Since 2009 there have been around 30 trade missions to Japan within the framework of the EU Gateway Programme, in which almost 1,000 European SMEs (small and medium sized enterprises) have taken part.

The programme offers a platform to help SMEs break into Japanese markets in sectors like new technologies and design.

Participants receive financial aid, and information adapted to their needs and targets in their particular markets. Over a week they visit other businesses and meet potential partners.

They also learn the best practices of doing business in Japan, which can make a big difference according to Hisataro Nonaka, a business expert with the EU Gateway Programme: “First know the people, before knowing the product and the company. And then, gradually, capture what they want.”

Japan is not only one of the world’s biggest markets, it is also one of the most competitive. To best succeed, Hisataro Nonaka says, you have to be innovative and find a specific market: “It’s a fiercely competitive market here. Many players already exist because of the market size. So it’s not easy to come in and just start selling a product.”

So what are the keys to success here? Plugwise’s Reinder Sanders told euronews: “Our keys to success in doing business in Japan is: be patient, build a strong relation with your business partner, be fully open about your way of working and your processes, especially quality control.”