Some Small American Companies Find Japan Not So Impenetrable
As US-Japan trade friction heats up, some wonder why all the fuss
FAR away from the big battles of the trade dispute between the United States and Japan, some small American companies are finding the Japanese market almost welcoming.
Japanese officials ``have really put forth great efforts to get our products into their country,'' says Janet Downey, president of Angler's Expressions Inc., a Boise, Idaho, maker of fishing-related gift items.
The exports to Japan by firms such as Ms. Downey's don't make much of a dent in the $59 billion trade deficit, but executives at some of these companies say they see a growing willingness in Japan to smooth the way for American products. Trade experts argue, however, that the experiences of such companies are exceptions to the rule that foreign firms are unfairly kept out of Japan.
The views of these entrepreneurs contrast sharply with the hostility that now characterizes the trade debate between Washington and Tokyo. The two nations broke off trade talks after President Clinton and Prime Minister Morihiro Hosokawa failed to resolve key disagreements at a meeting in Washington on Feb. 11. The US wants Japan to agree to meet specific, numerical goals in opening certain markets, but the Japanese say the US proposals amount to ``managed trade.''
Mr. Clinton is reportedly considering whether to invoke a tough US trade law, known as ``Super 301,'' that Washington has used in the past to force countries to open certain markets to foreign goods.
But all of this ``really doesn't make an awful lot of difference'' to Peggy Baird, who owns a Cambridge, Ohio, company that produces handwoven baskets, and who co-directs a consulting firm that helps companies enter Japan. The two firms together had sales of $220,000 in 1993, Ms. Baird says, and about half of the revenue came from Japan.
The key to her success in selling the baskets, which stand out in the Japanese market because they are made to evoke American heritage, is the consulting firm's Tokyo office. It provides a constant local presence for the basket enterprise, Cottage Country Baskets, as well as Japanese staff members who ``understand the customers - their language, their time zone, their culture.''
Downey, whose company makes novelty items emblazoned with angling motifs, says a Tokyo-sponsored nonprofit entity called the Japanese External Trade Organization (JETRO), which promotes access to the Japanese market, was a ``very important'' factor behind her 1993 sales to Japan - about $45,000 on total revenues of more than $700,000. (JETRO has also worked to publicize the experiences of manufacturers like Baird and Downey, sending out pamphlets to news organizations listing them and 38 other businesspeople with similarly positive stories to tell.)
Downey says she finds the US-Japan trade standoff perplexing, given the relative ease with which her products have entered the Japanese market. ``The whole situation is stupid as far as I'm concerned.''
Gary Whitwell, senior trade specialist for Asia in Idaho's department of commerce, says Downey's experience can be replicated by businesspeople who tailor their products to the Japanese market, travel to the country to meet prospective buyers, and pursue the sale with vigor.
Mr. Whitwell asserts that most American companies lack the commitment necessary to make it in Japan: ``The US no longer has any salesmen. They have only order takers.
``We don't care what [the Japanese] want,'' he adds. ``We want them to buy what we have.''
Although tales of markets opening are encouraging, says Larry Shimerine, vice president of Economic Strategy Institute, a Washington think tank, the ``overwhelming majority of companies will say the opposite.'' In almost every case of market penetration, he ventures, ``I'd bet the Japanese do not make the same product.''
But even the president of a company that has had a notoriously hard time entering a Japanese market rife with competing manufacturers now senses a growing inclination in Japan to lower barriers and trim regulations.
Dick Vink's IGT International Inc., a Las Vegas-based manufacturer of slot machines, last year sold 3,000 units in Japan, the result of a four-year struggle with regulators and competitors that was chronicled in The Wall Street Journal.
The exports are just a start - they brought in $7.5 million of IGT's parent company's 1993 sales of $500 million - but Mr. Vink is shooting for 15 percent of the Japanese market, or 45,000 machines.
Clinton's approach may be a little hasty, he suggests. ``I would like to give Japanese industry time ... because I see a sincere attitude on their side to deal with their bureaucracy.''