LIZ EARLE ENTERS THE JAPANESE MARKET International Management and Globalization Erina Jones Olivia Abrams Daniel King Debora Fusari Ludivine Pierre Helene Walpot
LIZ EARLE ENTERS THE JAPANESE MARKET
International Management and Globalization
Erina JonesOlivia AbramsDaniel KingDebora FusariLudivine PierreHelene Walpot
“High performance, quality and safe ingredients are our priority.”
NO ANIMAL TESTING OR INGREDIENTS
NO GENETICALLY ENGINEERED INGREDIENTS
ATTENTION TO THE ENVIRONMENT
PLANTS OIL AND EXTRACTS
RESPONSIBLE SOURCING
VITAMIN E
THE BUSINESS PLAN
Short Term:
Export products to the Japanese market
Manufacture in England
Concentrate on establishing local relationships and networks
Long Term:
Once experienced and knowledgeable about business in Japan, create a joint venture
WHY JAPAN? 1. Strong economy
2. International relations
3. Lucrative skincare market (Aging population)
EU
USA
China
Japan
Germany
France
United Kingdom
Japan $5,458,797
UK$2,250,209
World Economies Listed by IMF ranked by GDP (million US$)
Japan’s aging population is forecasted to grow in years to come
The ageing population of Japan outweighs all other nations with the highest proportion of elderly citizens, 21% over the age of 65
WHY JAPAN?
Lucrative market
COSMETICS REGULATIONS IN JAPAN
The Pharmaceutical Affairs Act:
Primary Distributors license
Label product in Japanese
List ingredients in Japanese
Make clear any health risks or possible allergic reactions
CULTURE and THEORY Vital to understand culture of foreign country
o Gain respecto Be seen as professionalo Communicate effectively
Geert Hofstedeo Cultural Dimensions
Hallo Contexto Communication
JAPANESE CULTUREHIGH UNCERTAINTY AVOIDANCEJapanese people don’t like taking risk and they prefer to build long term relationship before doing business
HIGH POWER DISTANCEHierarchy is very important and respected
MASCULINITYLarge distinction in the role expectations of men and women
COLLECTIVISMOrganization’s needs come before personal needs and loyalty is higly valued
HOFSTEDE
HIGH UNCERTAINTY AVOIDANCE
• Important to build long-term relationships
• Personal contact to arrange first meeings
• Bring a small souvenif of your own counry or company
HOFSTEDE
HIGH POWER DISTANCE
• The seating arangement is determined by status of employee
• Use proper titles when addressing people as this establishes their position
• Handshake combined with a slight nod of the head
MASCULINITY
• Role of men and wmoen are distinct• Traditional• Conservative
COLLECTIVISTIC
• Organisations needs come before individual needs
• Loyalty to the company is highly valued
Cross cultural communications Verbal style
Direct vs INDIRECTMessage delivered in an implicit manner
SUCCINT vs ElaborateSilence is a virtue
CONTEXTUAL vs PersonalNeed to focus on the speaker and long relationship
AFFECTIVE vs InstrumentalFocus on the process instead on the goal and very receiver focused language
JAPANESE CULTURE
HALL AND HALL
HALL AND HALL
INDIRECT STYLE• Implicit• Punctuality is fundamental• Hire an interpreter• Double sided business cards in both
Japanese and English
AFFECTIVE STYLE• Focused on process instead of goal• Receiver focused language
CONTEXTUAL STYLE• Strong focus on the role relationships
of parties• Heiarchical position and role
SUCCINCT STYLE• Silence is considered a virtue• Reflection taking place
“When my Japanese friend’s dad died, it was my first funeral in Japan. In Ireland, when someone dies, you say to the bereaved person “I am sorry for your troubles.” In Japanese, you say “go shuushodegozaimasu”. On the train on the way to the funeral, I practiced this phrase a million times and had it down perfect. At the funeral, I walked up to the shrine where you express your sympathies and prayed. I then express my condolensces to the widow, and said perfectly “go shuushodegozaimasu”. All was good. But my friend, another Irish man from Cork, hadn’t practiced this phrase at all. When it was time for him to show his grief, he said to the widow “Moshiwakearimasen”, which is close to saying “I am sorry for your troubles”, but when directly translated, actually means, “I am sorry for killing him.” Despite the sad occasion, the place cracked up into hysterical laughter.”
David Jones, Irish employee in Tokyo
ENTERING JAPAN
Japan External Trade Organisation‘3 Main Windows of Opportunity’
1. Innovation Hubo Japan is a leading centre for innovation
2. Business Platformo Japan plays an important role as a
“bridge nation”
3. Trend Settero Japan can be though of as a test market
before fully committing operations to Asian markets
PRODUCTS IN JAPAN
The brand name Liz Earle will be kept, and the packaging will emit image of good quality and luxury
The price will be set high to reflect good quality
Product
Urban consumers as they are more willing to buy foreign products
Target Audience
Price
• Cosmetics specialty stores.• Department stores• Online shopping
Outlets
JOINT VENTURE: OPPORTUNITIES AND RISKS
Problems will arise if… Lack of planning Lack of clear objectives Poor communication Poor integration and co-operation of
different cultures and management styles
Benefits: Grow faster Greater productivity Greater profits Access to new markets and distribution
networks Increased capacity Sharing of risks and costs Access to greater resources
RECOMMENDATIONShort Term (first year):
1. Export skincare products to Japano Through local Japanese distributors
2. Manufacture in the UKo To ensure best quality products
3. Develop close relationships with suppliers, manufacturers, distributors and customers
o To prepare for joint venture
Long Term:
1. Create a joint venture in Japan2. Manufacture in Japan
REFERENCES
(1) Luthans, F. & Doh, J. International Management: Culture, Strategy, and Behaviour (2008)
(2) Mead, R. International management: cross-cultural dimensions (2005)
(3) Schneider, S.C. & Barsoux, J.-L. Managing Across Cultures, Harlow: Prentice Hall (1997)
(4) www.lizearlle.com (Liz Earle homepage)
(5) www.venturejapan.com (Venture Japan company)
(6) www.jetro.go.jp (Japan External Trade Organization)
(7) http://www.beautyworldjapan.com/en/east/first.html (Japan Beauty and Spa Industry)