Advice from an importer of agri food products in Japan

A specialist in the import of French agri food products in Japan answers our questions

On June 21, 2023, we had the pleasure of interviewing Mr. François Xavier COLAS, Managing Director of the Japanese branch of Classic Fine Foods, known as French F&B Japan, a company importing high end agri food products, present in Japan for 40 years.

80% of the products imported by Classic Fine Foods Japan are European, of which 70% are French. The company imports and distributes high quality ingredients dedicated to cooking and pastry, as well as dry grocery products. Its clients are luxury hotels, fine dining restaurants, reception venues, airline caterers, as well as wholesalers supplying pastry shops.

Discover the advice of an expert on developing on the Japanese market and certain practices of importers.

His analysis of distribution channels in Japan :

In Japan, agri food products can be distributed through several types of stores, each playing a different role and corresponding to a different strategy:

• Department stores make it possible to enhance the image of the brand and the product and to sell at higher prices, however the volumes purchased are limited. Department stores only pay for what they have sold and return the rest to the importer. Indeed, using an importer is essential to work with department stores, as responsibilities are borne by the importer. In particular, the importer is responsible for providing a salesperson.
• High end supermarkets such as Seijo Ishii, Kaldi, Kinokuniya, Meidi ya, Meidi ya, Nissin, National Azabu are importer distributors. They import directly and allow larger volumes to be sold and better margins compared to department stores. They pay for everything they purchase and take the risk of stocking the goods. Within this channel, products are renewed every three years to meet customers’ expectations for novelty.
• Finally, large supermarkets and convenience stores (Japanese convenience shops open 24/7) are the ones that purchase the largest volumes from foreign exporters. They are managed by Japanese trading houses such as Mitsui Bussan, Mitsubishi, which act as importers and distributors. These contracts are very significant and more difficult to obtain.

These three channels are organized like a pyramid, from top to bottom, from department stores to supermarkets and convenience stores.

Sales volumes will be lower at the department store level but the product will gain visibility, while supermarkets and convenience stores can allow large volumes to be sold but do not build the brand image of the product.

It is possible to change distribution channels in order to evolve one’s strategy, however this can only be done from top to bottom.

For example, the brand La Mère Poulard gained its reputation in department stores and was later able to develop its sales through other distribution channels.

How do importers work ?

A local importer will be your key and indispensable partner to develop on the Japanese market. Importers of agri food products handle product registration with customs, shipment to Japan, and the storage of your goods in their dedicated warehouses before distributing them.

Japanese importers favor exclusive contracts. If this is essential for your Japanese partner, try to associate them with performance related objectives (turnover communication, points of sale, development strategy, marketing tools, etc.) which will help foster a transparent relationship.

For example, Classic Fine Foods sends commercial reports every three months detailing the evolution of its overall turnover and the revenue generated by different products, product by product performance, as well as distribution locations.

His advice on best practices to adopt :

To export to Japan, product quality alone is not sufficient; it is also necessary to be flexible regarding packaging, conditioning, and the quantities per package (stricter weight constraints and different eating habits in Japan).

It is advisable to come to Japan to understand the market, to test the potential of one’s product in order to determine whether it is sufficiently adapted, and to identify what interests local consumers the most. When you are a small company, one of the best ways to enter the Japanese market is to participate in trade shows in order to present your products to potential partners and consumers.

On the other hand, Japanese companies do not favor direct calls from foreign companies. Being introduced through a local intermediary is a good way to establish initial contact. There are various consulting organizations. CCI France Japan, thanks to its 100 years of presence in the country, has acquired a certain reputation that allows it to open doors for French companies.

To support the work of an importing partner, it is beneficial to have a local representative who masters the language and Japanese business culture. This person can support the importer in its commercial strategy in order to find new clients. It is important to note that Japanese people do not primarily have a sales driven mindset; they above all have a strong sense of service. Relationships with existing distributors and logistics are very well managed, but promotion and sales may require external support. According to Mr. Colas: “delegation without control is abandonment”.

To conclude, once distributed in Japan, it is essential to keep in mind that product quality must remain flawless; otherwise, it could mean the end of exports to Japan.

Regulations to keep in mind :

In the agri food sector, the most sensitive products to export are fresh products. Large scale retailers only accept products when more than 50% of their use by date remains. It is therefore necessary to take this rule into account, as well as shipping time (46 days by sea from Europe, for example) and customs clearance (2 weeks).

Mascarpone, for example, is difficult to import due to its 150 day shelf life.

New trends among its clients :

Within the activity of Classic Fine Foods, pastry ingredients are currently booming. Sugars, in particular “technical” sugars, and butter are increasingly in demand by Japanese clients.

French know how is highlighted both by pastry manufacturers wishing to differentiate themselves and by consumers who are concerned about product quality.

Conclusion

To sum up, Mr. François Xavier Colas has today allowed us to share with you some important aspects of the agri food sector in Japan.

It is a market that offers many opportunities for French companies, provided they adapt their positioning and meet local requirements.

Because each company and each product has its own specificities, our “Business Services” team supports you in order to help identify the best strategy and find the local partner that suits you.

Do not hesitate to contact us to receive advice. You can rely on our network and our knowledge of the market to define the steps to follow to develop in Japan.

We remain at your disposal : business@ccifj.or.jp