Japan - Commercial Guide
Distribution & Sales Channels

Discusses the distribution network within the country from how products enter to final destination, including reliability and condition of distribution mechanisms, major distribution centers, ports, etc.

Last published date: 2019-10-13
Distribution channels in Japan have undergone substantial consolidation over the past two decades. Channels vary significantly between consumer goods and industrial products.  
Due to limited space and dense urban populations, small retail stores are predominant points of consumer sales. Consequently, retailers often stock only limited stock, and wholesalers are required to deliver small amounts of a product more frequently.  

The Japanese cultural preference for doing business with face-to-face contact, and loyalty or sense of obligation in relationships, maintains this system. The costs of this less efficient distribution system are passed on to the consumer in the final price of the product. The growth of suburban “big box” retailers and eCommerce are challenging this model. 

Japan’s existing distribution and sales system still bear the traces of the keiretsu system. These larger  integrated business groups center around banks and trading companies, and were culturally ingrained in Japanese commercial dealings. Although the keiretsu system has weakened substantially, these corporations have business offerings along all facets of a particular industry, from production to distribution. Their advantages due to economies of scale, existing relationships, and consumer loyalty make them either very convenient and effective for those they serve or an elephantine competitor for smaller firms. The distribution channels these companies control can be a limiting factor for new exporters to Japan.  
Japan’s main logistics and distribution point centers are in the countries’ major ports in Tokyo, Yokohama, Kobe, Osaka, and Fukuoka.    
For detailed information on distribution channels for specific products and sectors, please contact the U.S. Embassy Commercial Section.