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Friday, June 15, 2012
Facilitating firms' move overseas big business
By JUN HONGO
Coping with the strong yen has become a key challenge for many Japanese companies especially in the past year, even as the government has sought to provide various support for those looking overseas to take advantage of the currency's clout.
But many companies remain cautious about diving into the overseas market despite the opportunity, and that's where Rieko Yamada, general manager of MarketOne Japan, saw a business opportunity.
"Many Japanese companies are willing to take a shot at spreading their business overseas, but aren't sure where they should start the process," Yamada said in an interview this week. "They also aren't aware of business regulations in some countries or don't know how to evaluate their chances of success there."
She added: "That's where we come in. We set the stage for Japanese businesses to take the leap by providing sales pipelines and offering them consultations."
MarketOne Japan, a branch of MarketOne Intl., based in Boston, has seen its business grow by 20 percent annually since opening an office in Tokyo in October 2006, according to the company. While the Tokyo office only has 25 employees, their clients include big names such as NEC Corp., Fujitsu Ltd. and Toppan Printing Co.
Over the past year, with Europe's sovereign debt crisis causing the yen to soar against the dollar and euro, many more have asked for MarketOne's help.
The secret to their success lies in providing a combination of direct access to key businesspeople in the target country, assessing the business environment of a particular region and providing suggestions for business prospects.
With branches in five countries, including Japan, MarketOne Intl. can offer programs that target particular countries or are regional or even global in scope.
"For example, whenever a company considers expanding their business overseas for the first time, they adopt a scattershot approach and rely on their current employees who were originally in charge of domestic marketing to do the research," Yamada said. "But the reality is that they don't have any experience or the resources and find it hard getting through to the key people."
Cutting the cost and time of exploring potential markets by outsourcing the initial business stage has proved to be a hit not only with medium-size and small companies without resources, but even with major companies as well.
"We decided we shouldn't be doing all of the local work ourselves," an NEC employee said during a seminar held by MarketOne in Tokyo last month. Together, NEC and Yamada's office approached Japanese companies in Southeast Asia to promote their IT infrastructure.
"Through our collaboration, we reached a new level of efficiency," the NEC employee said.
Yamada's office is a combination teleservices provider and digital marketing agency that also works as a one-stop business consultant. The company can even help domestic firms from making critical investment mistakes, Yamada said.
To cite one case, a domestic air conditioner maker wanting to do business in Europe, without any local resources, asked MarketOne for a consultation, requesting an evaluation of its intention to open a branch in England.
"Even if they knew who to call in England regarding their business chances, they would have likely been ignored since the company is virtually unknown there," Yamada said.
MarketOne took over the initial research and contacted possible business targets in England within weeks. The assessment revealed that the demand for air conditioning is low in the country, and the maker decided instead to build its European headquarters in Germany.
"That was a case in which we made it possible for the company to save both time and money through our resources," Yamada said.
A successful business model in Japan doesn't always translate into the same level of success overseas, Yamada warned.
After graduating from Rikkyo University in 2000, Yamada earned a master's degree in public relations from Boston University. She joined MarketOne in 2003 and was later tasked to open the Tokyo branch.
"Initially, there were only three staff members in Tokyo and we only had two clients," she said. But the business caught on quickly in the following years with global IT companies seeking their advice.
Yamada has also been asked to take part in running MarketOne's offices in Singapore and Australia in the last two years.
"The integration of the Tokyo office with other parts of the world allows us to provide services in a variety of languages and in a variety of regions," Yamada said. "In fact, we are hoping to provide more of our services to overseas companies seeking business opportunities in Japan as well, and not only the domestic companies," she added.
Amid the ongoing euro crisis, the yen is expected to remain at its current level or maybe even strengthen against foreign currencies.
The Japanese government may even carry out further emergency measures against yen appreciation by funding Japanese companies seeking overseas M&As.
"About 90 percent of our clients are from the IT industry. Our next goal is to reach out and support companies in other fields, such as engineering or logistics, and help them open their business overseas," she said. "I think the ball has only begun to roll, not only for us but for the Japanese companies as well."