How to start a business to sell Japanese Used Cars

Many inquiries to the Kawasaki One-Stop Business Startup Center about starting a new business in Japan are the export and sale of used cars. Even now, many foreigners procure used cars in Japan and sell them overseas like, the Middle East, Africa, and Europe.

The total number of used passenger cars sold in Japan in 2020 was 3,342,505 units, which is a slight decrease of 99.2% from the previous year but forms a stable market of around 3.3 million units every year. The number of used cars exported in October 2021 compiled by the Japan Used Car Export Industry Cooperative was 101,216 units, a decrease of 15.3% from the same month of the previous year. By destination country, Russia ranked first for the sixth straight month. The number of vehicles in the country increased by 19.9% to 15,046 units. The second-placed United Arab Emirates continued with 10,781 units, down 21.3% year-on-year. Kenya came in third, with exports down 1.3% year-on-year. Tanzania, New Zealand, and Chile are in fourth place and below.

Now, let me briefly explain the legal procedure for conducting this business.

—————————————————–
Chapter 1 Establishing a company
—————————————————–
First, create the articles of incorporation, which should be called the blueprint of the company. Information on the company’s business, capital, founder, and directors is described. What is stated here is the basis of the company. Next, determine the location of the head office. You can set up a company in a shared office or at home, but you need a completely private office to get a business and management visa. Our experts will advise you on the detailed conditions.
When the articles of incorporation are completed, you should ask a notary public to certify the articles of incorporation and apply for registration to Legal Affairs Bureau.

——————————————————————————-
Chapter 2 Obtaining a Business / Management Visa
——————————————————————————-
A business/management visa is a status of residence that allows you to do business in Japan as a business owner or manager. There are many conditions to obtain this visa, and it is well known that the capital must be 5 million yen or more. There are various conditions for the office as well. It is necessary that the office is already prepared and the company is registered so that the business can be started immediately.

The most important document for evaluation by the Immigration Bureau is the business plan. From the business plan, they will judge whether the business that the applicant is trying to do in Japan is feasible and sustainable. Yes, we can say that the most critical point for a business/management visa is how to appeal the feasibility of the business to the Immigration Bureau by your business plan.

Especially for the used car export business, there are many applications for business and management visas targeting this field, so the Immigration Bureau already has detailed information. Therefore, in most cases, the visa will not be given for a thin veneer plan. You need to seriously consider your business plan and make it as detailed as possible.
At Kawasaki Onestop, we will support the work of experts hearing the business plan and incorporating it into the plan.

————————————————————
Chapter 3 Obtaining a business license
————————————————————
To buy a used car, you must get a secondhand dealer’s permit. Regional Police are in charge because of monitoring the sale of stolen goods. Apply to the police station that has jurisdiction over the location of the office. Both individuals and corporations can register, but in doing business, many people aim to apply at a corporation in the sense of increasing the reliability of transactions.

In order to obtain the permission of the antique dealer, it is necessary to actually set up a sales office and assign a full-time sales manager. The sales manager can also be appointed as the representative director. You can open your business at home, but you will be asked to clearly separate your private space from your office space. (This is also an important point for immigration to check when obtaining a business/management visa as mentioned before.) If everything is OK, the permit will be granted in 2 weeks to 1 month.

Regarding the purchase of products, newcomers often purchase used cars from used car auction sites in Japan. There are many auction sites like USS, i-Auc, JU, etc. in Japan. Register with each auction company and open an account. At that time, depending on the auction, if you have a track record of more than one year after obtaining a secondhand dealer’s permit or if you are a corporate member, you may be required to have a bank account in the name of the corporation, so be sure to check with individual auction company in advance.

Used cars sold from the auction site can be stored in parking space that you have secured by yourself, or you can bring them to the stockyard at the shipping port and ship them directly. There are many specialized companies called “Otsunaka” that carry out a series of export procedures.

*************************************************************************
日本の中古車の輸出販売業について

カワサキ・ワンストップ・ビジネス・スタートアップ・センターへの新しく日本で事業を起こすことの問合せが多いのは中古車の輸出販売です。現在でも多くの外国人が日本で中古車を調達、中近東やアフリカ、欧州けに販売しています。2020年の日本における中古乗用車全体の販売数の合計は、3,342,505台でこれは前年比で99.2%の微減であるが毎年330万台前後と安定した市場を形成しています。また日本中古車輸出業協同組合がまとめた2021年10月の中古車輸出台数は、前年同月比15.3%減の10万1216台でした。仕向け国別では、ロシアが6カ月連続で首位となりました。同国は、19.9%増の1万5046台。2位のアラブ首長国連邦は、同21.3%減の1万781台で続いた。3位はケニアで、輸出台数は同1.3%減だった。4位以下はタンザニア、ニュージーランド、チリと続いています。

それでは、この事業を行うための法的な手続きを簡単に解説します。

————————————
第一章 会社を設立する
————————————
まずは会社の設計図と言うべき定款を作成します。会社の事業内容、資本金や発起人、取締役の情報を記載します。ここに記載されたことが会社のベースになります。次に本店の場所を確定します。シェアオフィスや自宅でも会社の設立はできますが、経営・管理のビザを取得するためには、完全な個室の事務所が求められています。詳細の条件については私たち専門家がアドバイスいたします。
定款が出来上がったら株式会社の場合は、定款を公証人に認証してもらい、登記申請を行います。

—————————————————
第二章 経営・管理ビザを取得する
—————————————————
経営・管理ビザは、日本で経営者や管理者として事業を行うことができる在留資格です。このビザを取得するためには条件がいくつもあり、資本金が500万円以上必要という条件は良く知られています。加えて事務所についてもいろいろ条件があります。すぐに事業が開始できるようにすでに事務所が用意されていること、会社の登記がされていることが必要です。

中でも入国管理局が一番重視する書類は、事業計画書です。本当に申請人が日本で行おうとしている事業が実現可能であり持続可能なものなのかを、事業計画から判断します。いかに入国管理局に事業の実現性をアピールできるかが経営・管理ビザにとってもっとも重要なポイントです。

特に中古車の輸出ビジネスについては、この分野をターゲットにした経営・管理ビザの申請が多いこともあり、入管は詳しい情報を把握しています。したがって付け焼刃な計画ではビザが下りないケースがほとんどです。真剣に事業計画を検討してできるだけ詳細に作る必要があります。Kawasaki Onestopでは、専門家が事業計画をヒアリングして計画書に落とし込む作業についてサポートいたします。

——————————————————
第三章 事業のライセンスを取得する
——————————————————
中古車を買い付けるには、古物商の許可というものを取得しなければなりません。盗品が売買されるのを監視するために警察が所掌しています。事務所の所在地を管轄する警察署に申請します。個人でも法人でもどちらでも登録できますが、ビジネスを行う上では取引の信頼性を高めるという意味で法人での申請を目指す方が多いです。

古物商の許可を得るためには、実際に営業事務所を設置して常勤の営業マネージャーを配置する必要があります。営業マネージャーは代表取締役が兼務することも可能です。自宅でも開業はできますが、プライベートスペースと事務所スペースを明確に分けるように言われます。(このことは、経営・管理ビザを取得する際にも入管がチェックする重要なポイントになります)問題なければ許可は2週間から1か月で下ります。

商品の仕入れですが、新規参入した業者は、日本にある中古車のオークションサイトから中古車を購入することが多いです。日本にはUSS、アイオーク、JUなどいくつもがあります。それぞれのオークション会社に登録して口座を開設します。その時に会社によっては、古物商許可を得てから1年以上の実績や法人会員の場合は、法人名義の銀行口座が条件として課せられる場合があるので、事前によくチェックしておきましょう。オークションサイトから落札した中古車は、自前で確保したパーキンススペースに留め置くか、そのまま出荷港のストック―ヤードに持ち込み、船積みします。輸出の一連の手続きを乙仲と呼ばれる専門業者が数多くあります。

Procedures Required to Purchase and Export Used Cars in Japan

We receive many inquiries about starting business to sell Japanese used cars overseas.

Since many Japanese people treat their cars as carefully as possible (for example, the bumpers of Japanese cars are often scratch-free), it seems that the price of used cars does not drop much when they are sold overseas.

To purchase and sell used cars in Japan, you must obtain a “secondhand dealer’s permit” from a regional police office. The condition is that there must be at least one sales office and one sales manager in Japan.

If you hire a Japanese person or a foreigner who is already resident in Japan, you can register that person as a sales manager.

If you are planning to come to Japan yourself and get ready to start a business, you will first have to obtain a visa (Business Manager visa).

You can start your business by:

  1. Register your company
  2. Obtain a business manager visa
  3. Acquire “secondhand dealer’s permit”
  4. Become a member of a car auction

Most of the foreign businesses use the car auction platform to purchase used car in Japan.

Kawasaki Onestop Business Startup Center can provide one-stop support for all of these steps.

For a brief information of starting a business in Japan, please see the YouTube video.



Another challenge for foreigners to start a business in Japan | Opening A Business Bank Account

For foreigners who want to start a business in Japan, there are many things that they have to do, such as finding an office, registering a company, and applying for a visa.
However, there are many specialists in Japan who can speak English, and we provide consultation and actual support. We at Onestop Kawasaki are a unique group of such specialists.

Today, let’s talk about another barrier you face when you set up a company, get a visa, get the business license you need, to start your business.

That is, “I can’t open a bank account in the name of a corporation.”
Japanese banks can easily open an account for individual account even if they are foreigners if they have a status of residence, but the hurdle is greatly raised when it comes to “corporate name”.
The reason is that in the case of a corporation, the transaction amount is also large, so “credibility” is judged more strictly. This is the same when a Japanese person starts a business individually.

On the other hand, Japan is said by the United Nations to be a country with loose restrictions on money laundering. The Financial Services Agency and other Japanese government agencies are closely monitoring the opening of bank accounts in the name of foreigners, which can be a hotbed for money laundering. Japanese used car export business is said to be the target. It seems that there have been malicious cases in the past. If you are planning a business to buy used cars in Japan and sell them overseas, you should be careful.

There are many documents required for this, and it takes time and effort to prepare financial plans and proof of assets currently owned by tax accountants and certified public accountants.
And the most confusing thing is that the criteria for opening an account have not been clarified openly.

In my experience, when I asked the bank why it was refused to open a new corporate account for a Pakistani entrepreneur, there was no further explanation saying, “I made a comprehensive decision.”
Eventually, the president gave up and decided to start the trading in his personal bank account. About a year later, the opening of a corporate account was finally approved due to the success of the individual transaction record and the appeal of the person’s enthusiastic attitude.

Talking about another case, when a foreigner started a business with the support from JETRO (Japan External Trade Organization), the person could easily open a corporate account with a support letter from JETRO. However, in order to receive JETRO support, it seems that the foreign headquarters must be of a certain size or the investment amount must be of a certain size.

When formulating a business plan, you may have to assume that there are such facts.

The walls to start a business in Japan

The 2020 Tokyo Olympics is coming soon, and there are increasing inquiries from foreigners who want to start a businesses in Japan, such as expanding sales channels for products in Japan, or importing Japanese products, etc. Both the central and local governments of Japan have begun policies such as special economic zones to support such trend. However, Japan is an island nation, and for 400 years from beginning of 17th century, Japan closed its country by restricting exchanges with foreign countries. As a result, there are many differences in the business environment. For many foreigners, it could be considered as a “wall”.
I would like to introduce such differences in Japanese business culture.

Wall 1 Government

The Japanese government has been active in accepting foreigners, but officials on the ground have not yet reached that level. Many are basically conservative, as inherited from the Meiji era. To start a business in Japan, you have to obtain permission or registration from various government offices. In order to start a business, such as the Legal Affairs Bureau of company registration, the Working visa to Immigration Service, and the used car business, you must submit a lot of documents to the police station to acquire secondhand dealer license and a tax office to import and sell liquor. Permission to start a business will not hurt you for being a foreigner, but explanations may be rough or inadequate some time.

Wall 2 Language

Unfortunately, you must submit your paper or electronically to get those permits. However, most of the documents are in Japanese. The only part that is accepted in English may be the visa application. Even the guidelines for obtaining permission are all in Japanese except for some visa-related items. Without support for those who can speak Japanese, there will be a lot of struggle to get permission. In order to obtain a business license, it is often necessary to determine the person in charge and take a seminar hosted by the government office, but most of the such seminars are limited to Japanese only. In the case of foreigners who cannot speak Japanese, there is no choice but to appoint or accompany someone who can speak Japanese.

Wall 3 Banking

In recent years, it has become increasingly difficult for foreign-invested companies to open corporate accounts in some industries, as Japanese financial authorities have put forward a policy to strengthen anti-money laundering measures.
Also, financing for foreigners is not very active, and financing for people other than those with permanent resident status or a Japanese spouse is not easy at present.

Wall 4 Business habits

The decision-making process of Japanese companies is very different from that of Western, Asian and other companies. It is often said that decision-making is slow, many business meetings, but no progress at all, have to exchange business cards with many people, but do not know who has the authority to decide. . . and so on.
A story about a Japanese company and a company in Zhejiang Province, China, said that the managers level agreed to launch a joint venture, and after that, the Japanese company delegates visited China many times, including the top management from Japan. In each case, the Chinese side responded in anticipation of when to give the go-ahead, but the Japanese side could not decide and ended up being neglected. Thus, negotiations with the Japanese also require patience.
They can all be described as one common character, a culture where responsibility is shared by as many people as possible. However, the Japanese have the habit of once they decide, they always do it.

To overcome these barriers, Onestop Kawasaki can support foreign entrepreneurs by using expertise of each member.