1. «About Japan » Webinar Series: Plastics Products & Components Silke BROMANN Dr. Silke Bromann Japan Consulting o 1

2. Dr. Silke BROMANN 2 Research and teaching on Japanese economy & enterprises since 1998 Dr. Silke Bromann Japan Consulting founded 2011 Research, analysis & consulting on markets and economy in Japan

3. Table of Content 3 The market for plastic products & components The characteristics of Japanese supplier networks Opportunities & challenges for European companies Strategies for success

4. Products covered in this report 4 Plastics in non-primary forms, e.g. plastics sheets or films Household items & construction materials made of plastic Packaging Automotive and machine parts made of plastic

5. Plastics in non-primary forms 5 Japan is the fifth-largest producer of plastics in the world with an overall production volume of 12 million tons Total production value in Japan ca. 2,900 bn Yen (2012) Setback after Lehman shock, path towards recovery Trends: health and environmental concerns, sustainability

6. Use of plastics in Japan (2010) 6 Source: Japan Plastics Industry Federation (2013): Shuyōkoku no shijōbetsu purasuchikku shiyō wariai 2010 (Percentages by user market in the main industrial countries, 2010), Internet: http://www.jpif.gr.jp/5topics/topics.htm http://www.jpif.gr.jp/5topics/topics.htm

7. Household items & construction materials 7 Household items: Market volume 314 bn Yen Health issues, Quality labels Construction materials: Usage of plastics in construction higher than in other industrial countries Legal issues, standards, Quality labels

8. Packaging Market volume 1,600 bn Yen Trends: shrinking package sizes, convenience food, environmental and health concerns Regulations concerning food packaging, labelling & recycling 8

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10. Automotive parts Different demand trends in Japanese and overseas markets General trends: –E-Mobility –Lightweighting –Environmental issues 10

11. Japanese production of plastic parts for transport machinery, in billion yen 11 Source: Ministry of Economy, Trade and Industry (2013): Paper, printing, plastics products and rubber products statistics, Tokyo: Ministry of Economy, Trade and Industry, Internet: http://www.meti.go.jp/statistics/tyo/s eidou/result/ichiran/08_seidou.html http://www.meti.go.jp/statistics/tyo/s eidou/result/ichiran/08_seidou.html

12. Parts for machinery Electric & electronic devices: fluctuating demand, price competition Medical equipment: growth trend, regulations Other machinery: positive trend in construction site equipment 12

13. Japanese supplier networks 13 OEM manufacturers (automobile manufacturers) First-tier suppliers (components such as dashboards, seats, wiring) Second-tier suppliers (parts and subassembly of components) Lower tier suppliers (parts, parts processing, standard parts)

14. Japanese supplier networks Production keiretsu Qualitative bonds in the keiretsu relationship –Long-term relationship –Cooperation in product development –Dispatch of managers Trend of lessening bonds Less rigid structure in sectors other than automotive Trend: more independent supplier SMEs: jisha seihin (independent product development), new distribution channels (other sectors, other materials) 14

15. Opportunities for European companies Niche products, USP New materials & technologies Globalisation of supply chains 15

16. Challenges for European companies High expectations regarding quality & service keiretsu networks Differences in standards and consumers’ preferences Especially for components: harsh competition in terms of cost-effectiveness and innovation 16

17. Strategies for success Innovation, Quality & Service Nurturing of contacts Long-term commitment Cooperation with Japanese partners 17

18. Many Thanks! 18 Silke BROMANN Dr. Silke Bromann Japan Consulting www.bromann-japanconsulting.de