What Are Japan’s Trends and Opportunities for Foreign Businesses in 2023?
With the fresh start of a new year, exciting trends and opportunities await your business in Japan.
Trends like these pop up when searching online:
Japanese society is getting older and older. Fewer and fewer children are being born. eCommerce continues to grow, and Japan continues to rely greatly on imports.
These tendencies carry business possibilities for you.
Then let’s dive into the latest trends for your venture.
What Are Japan’s Business Trends in 2023?
1- Society and industry
Low birth rates, a rapidly aging population, and labor shortages cause a need for new resources and solutions. Industries such as pharmaceuticals and medical devices, robotics and advanced manufacturing solutions, travel and financial services must develop to keep up with the upcoming challenges.
2- Import
As the 5th largest importer in the world, Japan continues to rely on imports from foreign countries. In particular, it depends on the import of natural supplies such as energy resources, sustainable energy solutions, and food in 2023.
3- The Japanese consumer
Japan has a well-educated and high-spending consumer base. They emphasize sustainable, high-quality, popular, cutting-edge items and services from Japan and other countries. Foreign brands that offer products meeting their expectations can profit from this trend.
4- Sustainability in business
According to asian investor, large Japanese companies might focus more on ESG and human rights due diligence. As a result, businesses consider restructuring their supply chains with local solutions instead of global ones. Since global supply chain prices escalated in 2022, local solutions can also be a cost-effective alternative. As a foreign merchant, it´s also important to keep an eye on how these changes will affect your competitors and their consumers.
5- Economy
Since real wages are stagnant and prices are rising, Japan may see a negative impact on local consumer spending in 2023. A weaker yen and higher energy prices are the leading causes of inflation. The Japanese government creates incentives to keep inflation as low as possible.
6- eCommerce
Despite economic challenges, the eCommerce landscape has blossomed in Japan, providing many opportunities for foreign companies to test the market. There is a shift in the audience as more older customers participate in online shopping. That creates a gateway to introduce products that are especially targeting them. Besides that, Amazon Japan has become the most frequented eCommerce platform and will continue to grow in 2023.
Read more about the top 10 best-selling product categories in Japan.
What Business Opportunities will be in Japan in 2023?
As demand across several industries grows, here are the most promising potential categories for your brand to enter the Japanese market.
1- Renewable energy technology
Renewable energy sources like solar, wind, and water, electric vehicles, green building technology, and more are increasing in demand. Until 2050, Japan has set the goal to support the development of these technologies while stepping away from fossil energy resources. This industry calls for innovative products and solutions, according to The National Bureau of Asian Research.
2- Artificial intelligence and automation
Since society is aging rapidly and the birthrate is low, Japan might face a workforce shortage in the future. Therefore, AI and automation are ways to keep productivity and efficiency up. It will also open doors to new business ventures like AI that will perform simple coding tasks instead of human being.
3- Agriculture and food production
The nation’s agriculture cannot meet domestic demands because of Japan’s past reliance on food imports. That’s why the country depends on imports of food and beverages and is expected to rely even more on imports in the next few years. As a foreign merchant, you can take advantage of the possibility of selling needed foods and beverages.
Read more about how to import food and beverages into Japan.
4- Sustainable packaging
Japanese customers have got more conscious about the sustainability of companies. Mass media, brands, and influencers created awareness of environmental issues within the past few years. Consumers are often well-informed about the brands and perform in-depth research before purchasing. According to study of Fabric, eco-friendly packaging can be a crucial element in transforming into a brand that is conceived as sustainable.
5- Healthcare products and equipment
Healthcare products and equipment are highly in demand in Japan with its rapidly aging population. These include pharmaceuticals, medical devices such as pacemakers or implants, and health supplements. As a foreign business, this could be a lucrative market to enter if market research is done properly. Many domestic brands already dominate the space.
Conclusion
Overall, these trends and opportunities indicate that Japan might experience a rise in demand across several industries next year. Foreseeing that can put you one step ahead of your competition as a foreign company seeking access to Japan. By examining the market conditions, you can find business opportunities in Japan for 2023.
How can COVUE help you?
If you wish to enter the Japanese market, we will help you to navigate through the unique business landscape. COVUE’s End-2-End Japan, Market Entry Solution, provides you with everything you need to expand to Japan now.