Tackling the ECommerce market in Japan is the best way to grow your business in the country of the rising sun successfully.
How are you planning to set foot in the Japanese market? Let´s take a look at how to get into eCommerce in Japan.
Quick Overview Of The Fast Growing Ecommerce Landscape In Japan.
As of today, Japan is the world´s 4th largest e-commerce market and it´s estimated that the eCommerce space in Japan will expand by 6% yearly until 2025 according to EcommerceDB. More than 74% of the Japanese population is already buying products on e-commerce marketplaces and this number is continuing to grow. In other words, the Japanese e-commerce market leaves plenty of opportunities for you as a seller to scale up your business by expanding to Japan.
Top 5 Best Ecommerce Sites In Japan 2022
As the global leader in eCommerce, Amazon has expanded into several countries, including Japan. As a foreign seller starting to sell in Japan, Amazon FBA is an excellent option for you because Amazon and Rakuten share a third of the Japanese eCommerce market volume.
With Rakuten’s E-commerce platform, you can sell directly to consumers in many categories such as electronics, clothing, accessories, cosmetics, and more. Consequently, Rakuten is one of the first choice of foreign sellers when expanding their business to Japan.
3. Yahoo! Shopping/ Yahoo! Auction
Apart from its counterpart Yahoo! Auction in Japan, Yahoo! Shopping Japan is another popular eCommerce website. Similar to Rakuten, it offers a wide range of products to its customers.
Mercari is another popular marketplace that seems like an advanced online flea market. This platform allows those in need of a product to get in touch with those who wish to sell their unwanted items. Through Yamato Transport and Japan Post agreements, users can anonymously send products from local convenience stores through Mercari.
Zozo Town is Japan’s most popular fashion-specific e-commerce site. Their customers can choose from a wide range of mainstream and niche products from domestic as well as international companies.
How To Get Started In Japan Ecommerce 2022
Selling on eCommerce platforms in Japan can be challenging for you as a foreign seller who takes first steps into unknown waters. Before you dive into the expansion of your business actively, there are four questions to consider when you wish to accelerate your business in Japan successfully.
1. Do your expansion intentions align with your current business situation?
When expanding your business to a foreign country like Japan, great chances await you. However, the risk is often higher. If you are already an established seller in your own country or several others, then you are aware of the potential opportunities and issues as well as the financial aspects that will occur. In this case, you are better prepared to start selling in Japan. Therefore it´s not recommended to expand to Japan when you are still an inexperienced seller.
2. What are the legal and tax regulations of Japan when importing?
Knowing and following the rules prevents problems from coming up when you enter the Japanese market. Before selling your products, you need to import them to Japan. Some preparations must be made in advance and there is one mandatory that helps you to get your goods into the country. You need an IOR (Importer of Record) who is liable for submitting the legally required paperwork and the payments of import taxes and duties in Japan. With the right IOR by your side, you can simplify the import process.
Learn more about IOR (Importer of Record)
3. What is the best shipping option for you when your products land in Japan?
An eCommerce marketplace is a great place to start if you are just about to expand to Japan. The platforms with the largest market share are Amazon Japan and Rakuten. They are frequented by millions of Japanese customers every day. Among the top Japanese marketplaces, Rakuten Ichiba offers support in English to foreign sellers. Moreover, Amazon Japan offers Fulfillment By Amazon (FBA) in Japan, meaning that Amazon handles your inbound logistics in Japan. As an ecommerce seller, you might find it easiest to ship and sell through one of the biggest marketplaces if you do not want to deal with distributors and third-party logistics.
Learn more about selling on Amazon and Rakuten.
4. What market research do you have to conduct?
Expect the unexpected – that is the best way to describe the nature of the Japanese market and its customers. Their mindset and preferences are quite different from what you are used to. Unless you want to stumble and fail by exploring the market without further research, you better do an extensive analysis of the Do´s and Dont´s when selling to Japanese people. An overall localization of your products, your web shop, your brand and more has to be a part of your expansion strategy in order to scale your business in Japan.
The 6 Biggest Challenges Of Doing Ecommerce Business In Japan Today.
- Rising finished product costs.
- Creating steady supply chains for the market demands.
- Developing and executing an overall digital strategy for Japan.
- Understanding the Japanese market and its consumers.
- Localization of the content tailored to Japanese preferences.
- Providing customer support with proficient Japanese-speaking staff.
Establishing a successful eCommerce business in Japan is determined by the strategy you put in place from the start. Choosing which product is best to sell on which platform in Japan is only one milestone on the path of decisions you have to pass. Without further market research, your chances to set ground in the Japanese eCommerce market are low. However, if you take advantage of the existing options and select the ones that suit you well, you can expand your eCommerce business smart, easily, and fast.
How COVUE Can Help You
We at COVUE understand the challenges you face when you are about to expand to the promising eCommerce market in Japan. That´s why we offer our End-2-End Japan Market Entry Services to serve your needs, answer all your questions and act as your extended operational arm in Japan.