Tips for starting a business in Japan

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People often think that being a business owner means you can choose your own hours and keep 100% of the profits all to yourself. Which is true if you don’t mind “choosing” to work 70 hours a week, and 100% of no profit might not afford you the luxury lifestyle you might wish for as an entrepreneur.

Before I go any further, I just want to put your mind at rest and let you know this isn’t a “woe is me” article about the struggles of owning an independent company; no one forced me to do this and I can technically quit whenever I like, I was careful not to take out a business loan and I rent my space, so it wouldn’t be a financial disaster if I were to walk away. I just want to lead you through what running a business is like in Japan, and some of the pitfalls you might come across.

For those of you that don’t know, probably both of my readers, writing is not my main form of employment, it is a hobby that I love and just so happens to trickle a steady stream of cash into my savings. My fulltime job…nay, my life, is teaching preschool kids. The school started in 2014 and it is slowly forging out a foothold here in the very competitive market of Nagoya city. It is still scraping by, and (as is true of most small businesses) is probably only a few bad months away from ruin, but I have settled into a rhythm now and life is almost back to normal. So whilst I wouldn’t scream from the rooftops that everyone should follow their dreams and open up shop, I would go as far to say that if you have found something you love, and you have crunched the numbers, there is a chance you can make it, with a healthy dollop of luck and some sage advise from a guy who has stumbled in the darkness for three years without any major incidents.

Do it for the love

This sounds like a real cliché, but it is by far the most important aspect of running a business, do something that you love to do, not something that you think will make you money. No matter how good your idea is, chances are you won’t be making a livable wage for a good few years, so do something you wouldn’t mind doing for free, or have a strong incentive besides cash. For me it’s having my daughter at the school, I get to spend all day with her, which is a privilege that I would gladly pay for.

Think of your own idea, don’t just follow trends

A few short years ago pancake houses seemed to rain down on Nagoya and there was a frenzy to enjoy these floury treats, now there are countless pancake houses struggling to get by. The same happened in the UK with a cupcake resurgence. These ideas can grab attention, but not necessarily retain it, so if a market is flooded, how likely are you to carve out a long-term business model?

Listen to people

I’d also share your pitch with friends and family, people who will give you brutally honest advise. You may be too close to the project to think about it critically, so don’t be offended if someone thinks it is a bad idea, ask them why they think so. It’s much easier to alter tactics before the doors open, so listen to criticism and advise, take it on board and adjust accordingly.

If something is free…use it!

The International Centre in Nagoya is a true wonder and was invaluable in setting up our school. My wife and I were told what kind of bank accounts and insurance I would need, types of contract for staff and patrons, and took us through step by step how to register the business. They even had a lawyer working on Saturday mornings who gave us free legal advise. Draw up a list of what you need doing and then do some research into how much of that can be achieved without spending a single yen, it might mean more leg work for you but will not only save you money, but give you a better understanding of how your business works.

If you need to pay for something, don’t be a cheapskate

Whilst the best things in life are free, unfortunately some essentials need to be shown the money. For me that was hiring an accountant, who is available to give advise for inputting data on a monthly basis (staff wages, expenses, sales etc.), but also does the thankless task of my tax returns, and those of my staff. Whilst some might have the patience and knowhow to do this themselves, I am terrified of the idea of making a mess of it, inadvertently dodging taxes and being thrown in a jail cell with nothing but an itchy futon and stale rice balls to keep me company!

Be wary of marketing companies!

If you happen to get a landline for your business (a good idea I would say), you may be taken aback when it won’t stop ringing! Unfortunately you aren’t being inundated with new business, but badgered by people hoping to squeeze a little cash out of you. The more common offenders I have experienced are photo-copying rental services, vending machines and advertising firms. I don’t want to speak to an entire industry (especially one I supply content for professionally), but I have had very little luck with printed ads, and don’t plan to use them again any time soon. Instagram and Facebook have gotten me a little attention, as have posting flyers around the neighborhood, but the most successful method is word-of-mouth. When I first started this used to drive me crazy, how can you build a base of loyal customers who recommend your business, when you have no customers?! Diligence, patience and flexibility have served me pretty well, put signs in the window, offer free trials, and don’t be too pushy. We let our preschoolers try out the school for three days before they put pen to paper, it helps the kids get used to us, builds trust with the parents and lets them know we aren’t in this to make a quick buck, but build a lasting relationship. We have had people come in the summer for some free lessons then disappear into the ether, but there is no point holding a grudge against these people, either our style didn’t suit them and they chose not to join, or they were just enjoying a freebie with no intention of joining, and those kind of people you could probably do without anyways.

Have fun

I started with a cliché so I might as well end with one; you will no doubt be stressed, and contemplate throwing in the towel on a fairly regular basis (especially at the beginning), but if you actually enjoy what you do, you’re much more likely to see things through and make a success of your company. Remind yourself of why you started this venture and concentrate on what aspects of it make you happy; it’s obviously extremely unhealthy to ignore what makes you stressed or depressed, but it is possible to address and overcome these issues without dwelling on them. Try and stay as positive as possible, celebrate your successes and dissect your failures to find out what might have caused them. Also, find the time to unwind after work, your business can consume you if you let it!