Category: European companies in Japan

Biggest foreign companies in Japan

It all depends on what you mean by big, of course. And, it turns out, what you mean by foreign.

Our favourite way of measuring size and growth at Rudlin Consulting has been by numbers of employees, because ranking by capital or turnover risks comparing apples to oranges. Taking a look at the rankings compiled by Toyo Keizai, the top 10 foreign companies in Japan in terms of numbers of employees are:

  1. Accenture (25,000 employees)
  2. Gibraltar Life Insurance (12,003 – US parent company Prudential)
  3. Mitsubishi Fuso Truck and Bus (10,633 – German parent company Daimler Truck)
  4. Metlife (8,569 US parent company)
  5. Prudential Life Insurance (6,169 US parent company)
  6. AIG (6,064 US parent company)
  7. Proterial (5,759 was Hitachi Metals, now owned by Bain)
  8. Sharp (5,603, now owned by Taiwan’s Foxconn/Hon Hai)
  9. Starbucks (5,505 US parent company)
  10. Bosch (5,254 German parent company)

It’s interesting to note that the majority of these companies are services sector, particularly insurance companies. Three out of the four manufacturing companies were originally Japanese but have been acquired by foreign companies. Some of the life insurance companies have also built up presence in Japan through acquisition, but are also divesting. Bosch also acquired a few Japan owned businesses but also divested its stake in Denso.

Toyo Keizai has not designated a nationality or parent company for Accenture, presumably because of being a federation of local partnerships. Similarly, EY and Deloitte should be in the top 10 as both employ over 10,000 but because of the partnership structure are not included in Toyo Keizai Rankings.

The rankings by capital (not market capitalization) are dominated by financial services sector companies:

  1. Nippon Paint (now majority owned by Singapore based Wuthelam Holdings)
  2. Metlife
  3. IBM Japan
  4. BNP Paribas Securities
  5. Citigroup Securities
  6. Axa Life
  7. Goldman Sachs Securities
  8. Bank of America Securities
  9. Gibraltar Life
  10. JP Morgan Securities

The rankings by turnover are:

  1. Sharp
  2. Nippon Paint
  3. Microsoft Japan
  4. Chugai (owned by Roche)
  5. Proterial
  6. IBM Japan
  7. Mitsubishi Fuso Truck
  8. NOK (owned by German company Freudenberg)
  9. Accenture
  10. Mercedes Benz

60% of these companies were originally Japanese.

Looking at all three rankings, it’s not surprising to see that these companies are long established in Japan.  Looking at the newcomers, and the sectors of the future, there is a clear trend of IT, systems and software companies entering the Japanese market,  primarily from the USA, but also France, Germany, Luxembourg, South Korea, Taiwan, Vietnam, and the UK. We’ve certainly seen a marked increase in enquiries for our services at Japan Intercultural Consulting from non-Japanese companies in this sector over the past couple of years. Japanese companies are embarking on digital transformation and further globalization, and the organisational change that this entails throws up plenty of cross cultural challenges both for the suppliers of digital technology and their clients.

Japan Intercultural Consulting holds regular online seminars covering topics such as cross cultural communications, business trips to Japan and what Japanese customers want. 

For more content like this, subscribe to the free Rudlin Consulting Newsletter. 最新の在欧日系企業の状況については無料の月刊Rudlin Consulting ニューズレターにご登録ください。

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Who are the Biggest Foreign Companies in Japan in 2020?

Toyo Keizai has not, as far as we are aware, issued another ranking of the biggest foreign companies in Japan since the one we blogged about in 2018. So for an update, we are relying on the analysis of a Japanese blogger working for a publisher in Tokyo, going by the name of Naganasu (long aubergine, ahem), who has done the number crunching from the Toyo Keizai directory for 2020.

Naganasu has not included minority foreign owned companies such as Nissan, who were top of the rankings last time. This means Accenture (headquartered in Ireland) has shot to the top, with a 70% increase in employee numbers from 7,600 in 2018 to 13,000 in 2020. Gibraltar Life Insurance,  a Japan only brand, formerly known as Kyoei, acquired by US company Prudential Holdings in 2001 is still at #2 with 12,731 employees. Naganasu has also not included Sharp, 65% owned by Taiwanese Hon Hai, which was at #3 before.

The largest European-owned Japanese company is Bosch, at #6 with 5,333 employees.  VSN (a staffing company acquired by Swiss company Adecco in 2012) has risen to #10 from #31 with 4, 271 employees, a third larger than in 2018. IKEA has also grown in Japan, from 2,700 employees to 3,200, up from #36 to #16.

As in 2018, there is a lack of British owned companies in the top 50.  The only one included by Naganasu is AstraZeneca at #19 with 3,000 employees. What happened to GSK, which was at #28 with 3,300 employees in 2018 is not clear. Perhaps they have shrunk to below 2,000 employees, so were not in the top 50. Alternatively, as we’ve often noticed with Toyo Keizai, if you don’t respond to their questionnaires, you don’t get included.

Other European companies in the 2020 top 50 are Adecco, L’Oreal, Bayer, Nestle, Philips, Valeo (French automotive supplier), Triumph (Swiss underwear company) and Autoliv (Swedish automotive company).

For more content like this, subscribe to the free Rudlin Consulting Newsletter. 最新の在欧日系企業の状況については無料の月刊Rudlin Consulting ニューズレターにご登録ください。

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Hybrid food cultures and the EU Japan Economic Partnership Agreement

The EU-Japan Economic Partnership Agreement (EPA) has been characterised in Europe as “cars for cheese”.  As a cheese loving North European, I did indeed miss being able to buy reasonably priced good quality cheese when I was living in Japan.  It was a kind of comfort food for me – either hunks of cheese on bread, or sometimes I would have what I called my “spaghetti Bolognese” moment, where I would crave the umami of a tomato and beef sauce smothered with parmesan cheese.

But because I also lived in Japan as a child, traditional Japanese foods are comfort food for me too.  Now I am living in the UK – I sometimes make miso soup (particularly the red miso I remember from when I was a child in Sendai), or okonomiyaki, or curry rice or tonkatsu to cheer myself up.

The EPA now has to be approved by various local European parliaments, and one of the ways of persuading them to accept the agreement is to point out that it will ensure the geographical designation of over 200 European food and drink products are protected in the Japanese market, such as Polish vodka or Parma ham.

If this argument is sufficiently persuasive to local parliaments, the agreement is expected to be ratified in 2018 and implemented in 2019. 

Europeans get very passionate about the authenticity of local food – particularly the Italians.  There is even a Twitter account called “Italians mad at food” (@Italiancomments) which retweets comments from Italians outraged – mostly at Americans – for putting mushrooms or garlic in carbonara sauce or pineapple on pizza. 

Italians would not be impressed with my spaghetti Bolognese either – there is no such dish as spaghetti Bolognese in Italy.  There is ragu alla Bolognese, which means simply a meat sauce – and is meant to be eaten with tagliatelle, not spaghetti.

The British have a long history of adopting foods from other cultures – our favourite national dish is Chicken Tikka Masala – which is a curry which does not exist in India – and the second or third generation British Chinese who run our takeaway food shops have become resigned to putting sweet and sour sauce on fries.

The British have become far more sophisticated about foreign food these days.  Multicultural street food has become fashionable across Europe – most major cities have markets full of “yatai” – one in my town has a Chilean stall and a falafel (Middle Eastern food) stall which is actually run by a couple of Koreans.

Japanese people are somewhat dismayed to see fast food chains selling “sushi” in the UK which have little resemblance to the authentic Japanese version but of course curry rice, tempura and tonkatsu are actually hybrid Japanese/European/Indian foods themselves.

So the EPA seems likely to herald another chapter of hybridization.  Japan and Europe will trade in each other’s authentic, local foods, and create new hybrids that will be the comfort foods for the next generation.  It’s a business opportunity both for traditional farmers and adventurous cooks. 

For more content like this, subscribe to the free Rudlin Consulting Newsletter. 最新の在欧日系企業の状況については無料の月刊Rudlin Consulting ニューズレターにご登録ください。

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How a UK online cycling shop wiggled its way to success

Great Britain led the way in winning cycling gold medals at the London Olympics, adding fuel to an enthusiasm for cycling in the UK which started a few years’ ago. Thanks to concerns about health, the environment and the horrors of commuting, more and more people have been taking up cycling, either as a hobby or a way of getting to work.

In Japan too, particularly after the 2011 earthquake highlighted how reliable this low tech transport can be, cycling has become more popular. Wiggle, a UK based online cycling accessories retailer, has been highly successful thanks to sales both to Japanese and British customers, but listening to a recent presentation by one of Wiggle’s managers made me realise it wasn’t just luck that enabled them to ride these waves of popularity.

In pursuing Japanese customers, Wiggle emphasises that it has Japanese speaking customer service representatives, fast delivery worldwide, and low prices – in that order. Each of these features has been key to cracking the Japanese market.

Apparently when Wiggle first realised that it had a significant number of Japanese customers, it simply used Google Translate to translate existing English text into Japanese on its website. Then when various Japanese customers started contacting them, including offering corrections to the Japanese, it realised it needed to start hiring Japanese speakers. Wiggle now has five native Japanese speakers on its staff, who not only make sure the website text is correct, but respond to Japanese customers by phone and email, and ensure the marketing campaigns reflect Japanese cultural preferences.

Having correct Japanese on websites is increasingly important, because although Japanese consumers are becoming far braver about ordering from overseas websites and paying using mechanisms such as PayPal, many have become victim to fraud, and there have since been warnings that one sign of fraudulent websites is poorly written Japanese.

The fast delivery is of course vital in competing against domestic suppliers and Wiggle were very keen to advise other companies aspiring to sell their products overseas that it is hugely important to get the domestic logistics right before attempting to deliver products overseas. By the time Wiggle started selling to Japan in any volume, they had a highly sophisticated warehousing system set up, located conveniently near international airports. Low prices are to some extent out of Wiggle’s control, as they have benefitted from the strong Yen, but it seems to me, that having got the Japanese speaking customer service and the delivery right, they should have a loyal enough following to see them through any unfavourable exchange rate movements.

One other key to retaining the loyalty of their Japanese customer base will be retaining the loyalty of their Japanese customer service representatives. All too often I have heard of British companies hiring Japanese speakers to deal with “difficult” Japanese customers and clients, and then not giving the Japanese representative the support and empowerment needed to deal with those demanding Japanese customers. Telling Japanese customers that they will just have to put up with delays or quality problems “because that’s normal in the UK” will not go down well, however politely and in perfect Japanese this message is delivered.

This article by Pernille Rudlin originally appeared in the Nikkei Weekly.  This and other articles are available as an e-book “Omoiyari: 6 Steps to Getting it Right with Japanese Customers”

For more content like this, subscribe to the free Rudlin Consulting Newsletter. 最新の在欧日系企業の状況については無料の月刊Rudlin Consulting ニューズレターにご登録ください。

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