Business Succession of SMBs in Japan (3)


Business Succession Crisis and Opportunity

Aging of small and medium sized

business (SMB) owners provides a great opportunity for M&A. The largest age cohort of SMB owners is 69 , and approximately 50% of them do not have their successors. Without viable business succession plan, many SMBs will be out of business in 10-year's time. Given the fact that business transfer to family members have declined, acceleration of business succession through M&A is one of the key national agenda of Japan.

Attractiveness of the Japanese market

Entering Japanese market from scratch has become difficult as the market is maturing. Japan, however, is still an attractive market with the 3rd largest economy in the world and relatively stable political environment. Among other things, the Japanese economy largely depends on many SMBs with excellent core competence in technology, marketing and operational excellence.

Changing M&A landscape

SMB owners used to avoid M&A as a means of business succession. In recent years, however, their mindset has gradually changed due to the lack of viable successors in their family members. The number of M&As in Japan has increased dramatically, and this trend will continue at least in the foreseeable future.

Great opportunity to enter the Japanese market

The increased intensity of business succession issue as well as the increase in the number of M&As provide a great opportunity for both Japanese and foreign companies as the key strategic options for business growth. Especially, for the foreign companies who do not have a vaible foodfold in Japan, M&A is the most effective and efficient way to enter the market.

Tommy Global Consulting provides business consulting services to the specific needs of foreign companies newly establishing or expanding their operations in Japan. Our consulting services cover a wide range of client needs including (1) investment strategy and business planning, (2) establishment of operations in Japan, (3) M&A, and (4) operational support and PMI

For more information about investment in Japan, please contact:

nagayama@tommyglobalconsulting.com

#MA #InvestmentinJapan #BusinessSuccession

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