German companies choosing Japan as Asia manufacturing hub: survey
Ideas
It's taken a relatively long time for other countries and companies to see Japan as a place for a company's manufacturing and normal business operations as it has been overshadowed by China for a very long time.
China was the king of manufacturing for very long time, and understandably so, but recent developments have maybe dimmed the China light, as companies, and even countries are not loyal as they are going to go to where they can get the best investment return for their money.
Japan might not be the cheapest place in Asia but it might be the most stable place and other countries, and their proximity to China, might be a turn-off for some companies.
Japan is still a manufacturing powerhouse as manufacturing is a a key driver of the Japanese economy next to Japanese exports.
And yes, its seems German companies just don't manufacture German products but Japanese products too which is a good sign that manufacturing companies are not completely loyal as they manufacture whatever is needed to bring profits to them.
There might be many countries now, besides China, that many companies globally want to enter and yes, Japan is not the only country, but again, it might be the most stable country.
Other countries such as South Korea, Vietnam, Thailand, Indonesia, and Malaysia might be good options too so companies have a choice among Asian countries to establish their manufacturing operations.
And again, many German companies see Japan as the best place for their operations and yes, some might be considering expanding their presence in Japan instead of maybe some of the other countries listed above.
Japan is a stable place for logistics companies to carry Japanese and German products to many countries globally and they are close to the west coast of the US not to mention close to South Korea, very close to China and close the many Asian countries which would make shipping relatively cheap.
Yes, Japan and Germany don't follow the typical western US model of business relations but value long-term relationships and do take time to develop. But once developed they last for a very long time, which makes for the stability of the relationship.
The US model, for example, might want everything done quickly and quick decision making doesn't make for a solid business foundation which is very important for both Japan and Germany.
Proximity to customers is very important as being in Japan places German companies within proximity of 60 percent of the worlds population in the Asia region.
Stability of supply chains has become even more important as supply chains in Japan give the needed reassurance of operations in Japan.
And yes, unfortunately, political risk has become an important issue affecting global companies and they are looking for countries, like Japan, that have stable business and government environments.
Yes, these days economic stability is becoming more important for global companies as maybe the bright light, that was once China's, as dimmed for many global companies as they look for more economic stability these days.
And again there are many other countries, in Asia, that German companies can consider but Japan, once again, seems to be the most stable related to government and economic stability these days.
Japan is not a perfect country, as there is no perfect country, but the key qualities it has might be slightly better than some other countries in Asia.
And yes, as far as reliability goes, Japan might be the leader in reliability as other countries seem to slip a notch here or there in the reliability rankings.
Japan does have some challenges with talent acquisition and retention, but it depends on what is the definition of talent and what is the real definition of retention especially as it relates to Japan.
For example, there might not be enough qualified Japanese workers for the type of skills that German manufacturing companies need and maybe some Japanese workers don't want to work in manufacturing.
However, manufacturing today might not be labor-intensive work that was done 50 years ago, but now requires almost the technical skills of an IT worker as manufacturing jobs now are heavily involved with automation and robotics.
That's where Japanese immigration goes into play as there many workers, with IT skills to work in manufacturing in countries such as South Korea, Thailand, Vietnam, Indonesia and even China.
But the challenge is Japan immigration is still somewhat closed off to many of these skilled workers who want to work in Japan.
Yes, Japan has an English deficiency problem as the average Japanese just doesn't have the needed English skills needed for the jobs that German manufacturing companies need.
And again, maybe some Japanese high school or university graduates don't want to work in manufacturing as they might see those jobs being low level skilled and or don't pay that much compared to working at name-brand large Japanese company jobs.
This survey just points out that Japan is a very good place for a company to have a manufacturing plant in as its a very stable country to be in.
There are some challenges related to staffing and the perception that manufacturing is a labor-intensive job that many young workers might not want to do today.
But manufacturing has outgrown its days of being a labor-intensive occupation but is now actually a significant high tech industry of innovation with robotics and automation as its key components that requires highly skilled workers.
If the Japanese government can figure out how to leverage its soft-core advantages and open up immigration for the good of the Japanese economy who knows how far or much the Japanese will grow in the future.
Have a nice day!
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