Dear All,
In regard to the proposed company’s expansion efforts, here are the management considerations of entering the Japanese TMT market.
Political
Japan is a constitutional monarchy headed by an emperor. It enjoys a stable internal political environment and maintains close relationships with countries like the US. It has recently put significant efforts to strengthen the relationship with other powers such as UK, France, Australia and India, efforts that have become politically contentious and could potentially impact foreign direct investment and overall trade due to trade barriers.
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Economic
Japan is ranked as the 3 rd largest economy in the world and the 2 nd in Asia. Japanese countries are expected to pay commercial tax on the revenue they make from home and abroad. Foreign companies operational in the country are needed to pay tax on income generated from the country.
Social
It is among the most populated country in the world with a number of social challenges such as ageing and low birth rates. Also. Majority of the population favor Japanese companies to foreign ones making trading hard for foreign companies, hence the reason many foreign companies failed in Japan (Matyrko, M. (2017). However, foreign companies also thrive in the country depending on their strategies.
Technological
Japan is the epitome of technological advancements. Many countries struggle to emulate its creativity and technological innovations. The country’s technological developments has enabled it to excel tremendously in myriad sectors, offering great opportunities for both its citizens and foreign investors (Vahanyan, 2017).
Legal
Any person can work in Japan either as an employee, dispatched worker, or an independent contractor. Whether local or foreign, companies ought to register employees for health, worker’s accident compensation and mandatory insurance. Employees enjoy a number of employment rights and benefits.
Environment
One of the biggest issue in Japan is waste management hence has come under pressure to minimize waste as well as controlling environmental pollution. Furthermore, it is one of the most affected by natural disasters and calamities. Given that the activities of the company will have no overall environment impact, it is an unimportant factor
It is noteworthy that the identified factors are important save for environmental aspect, and can have significant effects on TalkBox. However the extremely important ones are the economic, social and technological factors. In light of this information, while entering this new market, I would propose partnering up as the best strategy. Even though there could be other strategies, partnering up would be the best to begin with before the company can establish itself fully in Japan.
Kind Regards,
Senior Human Resources Personnel
References
Matyrko, M. (2017). Basic Approach for Evaluation of Foreign Market's Potential and Attractiveness.
Rahman, M. PESTEL analysis of Japan.
Vahanyan, V. (2017). Doing business and competitiveness environment to evaluate countries for operations in the information and communication technologies (Doctoral dissertation).
