Top 6 Challenges of Entering Japan's eCommerce Market

Are you interested in expanding your eCommerce business to Japan? Japan?is the world's third-largest online eCommerce market, frequented by?48.2% of the population every week.?Therefore, it is not surprising that more international brands are looking to expand to the country of the rising sun.

However, there are challenges to breaking into this market that you can mitigate with COVUE's support.

1- Meeting Japanese regulatory requirements?

Japan has strict regulations and standards for eCommerce products,?particularly for?regulated products such as food, cosmetics, pharmaceuticals, and more. That is one of the top challenges?that foreign companies experience.

It is important to ensure that you comply with Japanese import laws and taxes. The first thing you need to?know is that you need an?Importer of Record?when importing products into Japan. Marketplaces like Amazon or Rakuten?cannot act as your?Importer of Record.?COVUE owns import licenses for more than 95% of product categories and?ensures that you comply with regulations and tax payments when importing.

Read more?on how to get into eCommerce in Japan.

2- Dealing with?complex?logistics and?distribution networks?

Japan has a highly developed logistics and distribution network that can be difficult for foreign sellers to navigate. That can cause hurdles when you want to fulfill orders, manage inventory, and handle returns.?It′s crucial to be aware that you need an Importer of Record to process and receive your?returns.

?Partnering with logistic providers to manage your shipments is one way to overcome this challenge.??If you sell on marketplaces like Amazon or Rakuten, you can leverage Amazon FBA or Rakuten Super Logistics to handle your delivery.?You may also consider COVUE's?Japan Inbound Logistics which picks up your shipments from the port, processes taxes and customs clearance, and transports them to their next destination or deliver them?door-2-door.

3- Navigating Japanese culture?

Japanese culture is a challenging part of the market to adapt to. Building relationships with customers requires a deep understanding of their customs and language. Besides that, Japan is home to?several shopping events?that are distinct to the country.?For example, you can leverage Black Friday and Christmas and the yearly summer and winter bonuses paid to Japanese employees, as Japan has a rich gift-giving culture.?By partnering with COVUE, you can?utilize?the market and cultural conditions in your favor as we can connect you with your local audience.

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3- Overcoming language barriers??

To cater to the Japanese market, it's important to note that customers prefer to shop in their native language and have high expectations of eCommerce sellers, such as quality products and excellent customer service. To meet their needs and achieve greater customer satisfaction and conversion rates, it's crucial to translate and localize your website, marketing materials, and content into Japanese.

?At COVUE, we provide comprehensive localization services that cover everything from branding and design to?content localization. We convey your message effectively in Japanese, helping to elevate your brand in the Japanese market. Moreover, our dedicated customer support team ensures that we provide the best assistance to your Japanese customers.

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4- Attracting Japanese consumers?

A lack of expertise and understanding of Japanese consumers can?hinder you from scaling in Japan.?For example, you can establish trust by offering high-quality goods, flexible delivery options, and top-notch?customer support.?A local operating partner like COVUE can support you in meeting the high expectations of Japanese customers.?Moreover, providing exceptional customer service in their language and informing customers about the brand, product details, upcoming launches, sales, and exclusive coupon codes helps to engage with your audience and impact their purchase-buying decisions.?

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5- Offering the right payment system?

?Japanese consumers have a unique?payment behavior?that can be challenging for foreign sellers when they are unaware of it.?Popular payment methods include credit cards, cash on delivery, and convenience shop payments. In particular, many customers prefer to pay in cash at convenience stores, even for online purchases, due to the widespread availability of such stores across the country. This preference for cash is especially prevalent among older and younger demographics who don′t have credit cards or bank accounts.??

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In conclusion, entering the Japanese eCommerce market has several challenges for?foreign sellers. However, with effective strategies and an understanding of the market, that COVUE provides along with?our End-2-End Japan Market Entry Services, you can overcome these challenges and succeed in one of the world's largest eCommerce markets.

Want?to enter the Japanese eCommerce market but not sure how???

Contact us?for a free consultation.