Article | JETRO Guangzhou
Introduction
36Kr Chuhai has partnered with JETRO Guangzhou to launch “Thoughts on Developing Business in Japan” series articles that introduce examples of Chinese companies successfully developing business in Japan and their experience. As a non-profit organization administered by the Japanese government, JETRO provides services for Chinese companies to develop business in Japan, including market and industrial information, introduction of service providers, temporary offices, and connection with relevant channels.
For this issue, we have invited Liu Yangbo, head of Japan business at Shenzhen Farben Information Technology Co., Ltd., to share his observations and thoughts on software companies’ efforts to develop business in Japan.
Mr. Liu Yangbo, head of Japan business at Sehnzhen Farben Information Technology Co., Ltd.
Below is the interview content (which is edited without altering the original meanings). Q stands for JETRO Guangzhou, and A stands for Liu Yangbo from Farben.
Interview Text
Q: Please give a brief introduction of Farben’s primary businesses.
A: Farben was founded in 2006 and is headquartered in Shenzhen, China. As an international top information technology service provider, Farben has businesses in more than 60 cities in China and over 10 regions worldwide, including Europe, the Asia-Pacific Region, North America, South America, the Middle East, and Africa.
Farben provides software development services (ITO), products and solutions, and digital operations support services (BPO) that assist in the product and technology innovation and business transformation of more than 1,200 domestic and foreign customers in over 10 industries, including the finance, internet, and automobile industries. For example, Farben provides customers with financial IT series solutions, intelligent cockpit solutions for vehicles, and FarAI GPT series products.
Farben is committed to providing customers with advanced and efficient digital tools and platforms, mature technology products and solutions, and the corresponding IT services to promote corporate digital transformation and intelligent upgrading.
Q: Why did you choose to develop business in Japan? What are Farben Japan’s primary businesses?
A: Just as mentioned by our chairman Yan Hua, China’s digital economy is developing in depth and entering the international markets, while new technologies and the international environment are bringing new growth points. That’s why Farben is steadily advancing its global development strategy. Farben has set up business centers, branches, and agile delivery centers in countries and regions such as Japan, Germany, Singapore, and Hong Kong.
As the fourth largest economy in the world, Japan has a mature market environment and strong spending power, with increasing demand for digital transformation, technological innovation, and high-quality services. The Japanese market has dramatically high demand for efficient IT solutions, advanced technical support, and digital services, which is highly compatible with our expertise and business capabilities. Developing business in the Japanese market not only helps the company make further progress in internationalization but also provides Japanese companies with high-quality and customized solutions, hence attaining win-win results.
Farben Japan was founded in Tokyo in February 2023. As Farben’s wholly-owned subsidiary in Japan, it specializes in providing the Japanese market with excellent IT solutions and services. Its businesses cover a variety of areas, including software development, system integration, technical consulting, and IT outsourcing. Our company leverages its resource advantages in talent, technology, and service, particularly its experience in integrating advanced technologies and industry in China’s digital economic development in recent years. With our professional technical support and localized services, we help Japanese companies achieve digital transformation and business optimization.
Taking this opportunity, we would like to extend our special thanks to JETRO for offering generous support and help at the beginning of Farben Japan’s establishment.
Q: Please share with us your understanding of and insight into the IT market in Japan. According to your observations, what opportunities does Japan have for Chinese software companies?
A: The IT market in Japan is of a large scale, highly mature, and maintains growth. In particular, demand is strong in the fields of digital transformation, artificial intelligence, the Internet of Things (IoT), and cloud computing. The Japanese government has also rolled out a basket of policies to support digital and emerging technologies, fostering a business-friendly environment.
We have learned a lot from our contact with Japanese customers. In Japan’s business culture, the establishment of long-term relations and trust is highly valued, entailing a long decision-making process, high requirements for details and quality, and high operating costs, including labor and office costs.
Chinese software companies similar to Farben may pay attention to business opportunities in the following aspects:
In terms of AI and big data, Japan has increasing demand for automation and efficiency improvement, hence driving a growth in opportunities for cooperation in this aspect; in terms of cross-border e-commerce and payment technology, Chinese software companies have competitive edges in cross-border payment, supply chain management, and e-commerce platform development; in terms of cloud computing and SaaS solutions, Japan has strong demand and is getting increasingly concerned with cost effectiveness, so Chinese companies may start with the SMEs market and provide highly cost-effective SaaS services.
Q: What difficulties did you encounter in your market expansion in Japan, and how did you solve them?
A: Make preparations before taking any action. We did effective market surveys and preparations before entering the Japanese market. At the same time, we have extensive experience serving Japanese companies in China.
After establishing the subsidiary, we set up a localization team to overcome cultural differences and adapt ourselves to local regulations and compliance requirements. We hired people who speak fluent Japanese and understand Japanese business culture to help communicate with our customers and recruited senior executives in Japan to assist us in localization. We also appointed local legal advisers and experts to make sure our business processes are in compliance with Japanese laws and regulations.
The most challenging part lies in developing the market from scratch, as the process involves barriers such as different understanding of products and solutions and building trust between the two parties. Luckily, Farben paid many visits to its customers at the early stage of establishing its Japanese subsidiary, showing its great concern for building a long-term partnership. To meet the requirements of our Japanese customers, we worked with our co-workers in the Technology Development Department in the head office in Shenzhen to conduct multiple rounds of internal tests and made continuous improvements based on customer feedback. We also added an after-sales support team to make sure to promptly respond to customer demand. Through our hard work, we have won trust and recognition from our customers, established good cooperation with them, and gradually gained market shares in Japan.
Q: What expectations do you have for the Japanese market in your next step?
A: Judging by multiple factors, including the digital trend and strong demand in the Japanese market, innovation driven by the aging society, and continuous technology development, the Japanese market will maintain stable growth, with huge opportunities in digital transformation, financial, and environmental fields.
Both Farben and Farben Japan are fully confident in the prospect of the huge market in Japan and look forward to achieving win-win development with customers and partners. The Japanese market is an important part of Farben’s global development strategy, and we will keep inputting more human and material resources for market expansion.
Q: What suggestions do you have for Chinese companies that plan to enter the Japanese market?
A: Based on Farben’s experience, I suggest Chinese companies develop multi-dimensional strategies that accommodate local needs, are in compliance with local regulations, maintain relations, and involve long-term input based on market surveys. A deep understanding of the Japanese market demand is a prerequisite; improving technologies, products, and service quality is the key; and localization is the essential path. It is imperative to continuously strengthen competitiveness and gain customer trust.
As China’s service trade continues to grow and China’s manufacturing and intelligent manufacturing are taking increasing market shares overseas, there is a huge potential to develop overseas.
About JETRO
The Japan External Trade Organization (JETRO) is a government-affiliated entity established in accordance with the law for the purpose of promoting Japan’s external trade and investment. It provides information to Chinese companies and local governments and carries out activities that facilitate cooperation between Chinese and Japanese companies and support Chinese companies’ business development in Japan. JETRO also supports Japanese companies’ business development in China by providing business support, consulting services, market information, and dialogues with local governments on improving the business environment.
