The decision to expand abroad is one of the most important strategic events in the growth and development of a business. It is critical to take a balanced view of the benefits and risks of entering into a foreign market. There are numerous factors a firm should learn about doing business in another country; some of them include the demographics, infrastructure, the people and their culture, and foreign direct investment. Although this is just the tip of the iceberg, the following is the comparison of Japan and the United States of America.
Japan consists of four main islands and a number of smaller ones which combined cover 142,000 square miles. Approximately 73% of Japan's land area is mountainous, with heights rising to over 10,000 feet. Japan currently has a population of 127 million. Although with one of the world's lowest birth rates, this is expected to fall to 121 million by 2025 with more rapid falls predicted in the following decades.
Japan also has the world's longest life expectancy for both men and women. When combined with the low birth rate, this produces a rapidly ageing population - an estimated 29% of the Japanese population will be over age 65 by 2025.
Japan has a fully developed infrastructure of roads, highways, railroads, airports, harbors, warehouses and telecommunications network for distribution of all types of goods and services. However, major problems remain with Japan's infrastructure that hinders the distribution of imports. Japan's port practices remain nontransparent and inefficient by global standards. Furthermore, import processing remains relatively slow in part due to over-centralization in the major cities, high land prices and regulations which restricts large stores. Japan's retail stores are small on average, lacking adequate shelf space. As a result, they require frequent stocking by wholesalers using...