AboutEric Hofer Expertise Over 27 years experience, with 17 in international FMCG in back office operations and in field sales and data collection, including design, development and deployment of Handhelds, Marketing Equipment (Service, Tracking and Return on Investment), reporting and Vending management. Have participated on the launch of operations in new markets, and re-engineered the back office in several countries.
Experience Designed and led the development and deployment internal ERP system for Pepsi used in On-Premise/Vending in 13 markets.
Designed 2 handheld systems, the latest is now deployed in 4 markets internationally.
Re-engineered the back office functions (settlements, despatch, invoicing, credit control, etc) for over 20 snack, confectionary and beverage operators.
Developing software: Progress, VB, Access, C, Sybase, SA
Organizations Innovative-Selling Solutions
Publications BudapestSun
Education/Credentials State University of New York - BA Economics
NYU - Courant - Graduate work - Computing
Past/Present clients PepsiAmericas
PepsiCola International
PepsiCola Company
British Steel
British Telecom
Britvic (Pepsi's bottler in the UK)
AT&T
BellSouth
Mars Overseas Bottling
Pepsi France
Matutano (Frito-Lay Spain)
Frito-Lay
Pepsi Foods International
Chase Manhattan Bank
Kidder Peabody
National Power
SmithKline Beecham
Mars Overseas Bottling (Pepsi Azerbaijan)
A&P Bottling (Pepsi Serbia & Montenegro)
Iberia Bottlers (Pepsi Georgia)
I live in Tokyo Japan, but used to be a resident of Oregon. I'd like to start a small, maybe website based, import business specifically for importing Oregon beer to Japan. I already have a local business in Japan, so I can use that license to get my import business off the ground. Could you help me with some of the questions below?
1) How can I get a connection with the breweries to ship to me directly? Only one of them currently has international sales. Most Oregon beer is sold only on the west coast. I checked their FAQs on their websites and it said they don't ship directly to other states because of federal laws. I assume this is because this is for customer shipping, not B2B.
2) Do you know how I could ship into Japan? Do I have to pay high customs for importing?
3) What kind of "red tape" is typical of trying to import alcohol from the US to Japan?
Thanks! Mike
Answer Mike,
These aren't on my list of expertise, while I cannot give you too much in the way of specific red-tape in Japan, I can offer my 2 cents of experience. Couple with you already being in Japan, this might help you to more easily locate local resources to help you.
To answer your key questions, a strategy would be to search for "shipping agents" or "import agents" or "customs clearance" from the Japanese side (rather than US exporters). Aside from finding somebody who can "do" the work, you'll also get additional connections, learn how the process "does" work. etc. Aside from searching say "Google" for these terms in Japanese, also consider business social websites such as www.linkedin.com. Sadly, I tried www.alibaba.com which is generally great but they didn't have any entries for Japan/US shipping agents.
The issue you're seeing with the brewers in Oregon, I suspect, is because they are "small", limited with capital and interstate sales would open them up to further scrutiny and fees. Hence a reason not to pursue such (at the moment). I agree with your conclusion that they are specifically avoiding B2C vs B2B. I seriously doubt an Oregon brewer would turn away 3 containers a quarter in sales - and might even cover some of your other capital outlays, or at the very least discount.
In looking at this, I saw that beer exports to Japan had tailed off markedly between 2000 and 2005 - but mainly as US players established local brewers. This is easily explained as not being from a drop in demand, but rather that exporting finished goods inter-continentally is VERY expensive while brewing under license, and within the tariff zone, is much cheaper. For you, with a micro/local brew, this probably is not an issue. The stats show that there was a market and price insensistivity earlier. Though you'll now be at a premium vs local "foreign" brews which in turn could restrict your market-size.
I know of a few people doing international import of beer. The big issues I've heard are:-
- capital tied up during trans-shipment and customs clearance
- lack of a returns (stale, damaged) capability
- local environment rules (deposits and handling of empties)
- marketing to the indigenous population
- insurance against loss of cargo (or product going stale before delivery).
One group specifically markets to overseas Ukrainians, capitalizing on their nostalgia. They have suffered several instances where their beer was held hostage at the docks leaving them only weeks before they coded out (went stale).
Japan, apparently has strict sanitary laws. They'll probably expect assurances that the local brews from Oregon are assayed. Such will probably be an ongoing thorn in your side. You'll need to determine how such is done, and get a mechanism in place to keep the authorities satisfied.
Another aspect to check is how beer is warehoused. Is it bonded so that the tax only applies when it leaves the warehouse? In some countries, additional "sin" taxes require special handling for the delivery of alcohol. Like with the Shipping Agent, you could leverage a particular distributor with such experience, paying a premium until you understand the process and have the capital to become more independent.
Labelling and preservatives requirements are another issue. In your discussion with an Oregon micro brewer, given the size of your shipment, they might be willing to meet Japanese requirements (on the labels); printing up translated documents complete with your "local importer" details.
Local shelf life requirements might differ from those of the US; in Europe the rules are harsher than the US (heck, I've noticed that in the US some items don't even say what their shelf life is). Further, these might have to be printed in the Japanese format, with characters that an Oregon brewer might not have the capacity to write (or at least check).
Shipping and customs clearance eats up "shelf life" time; and the shipping itself could be perilous - temperature and/or exposure to light can affect product quality and even safety.
Pilferage may not been an issue. You'd be best to "model" this (say 3%); and don't count on impregnable containers. I recall hearing a story from a client about importing Baileys to a country in central asia related to me how they were losing 5 cases a container, so they upgraded security on the containers. When the first, newly upgraded container came thru, the logistics director smugly headed down to the customs clearance, opened the container to find it contained just 5 cases; all tied up with xMas ribbons.
Naming and trademarks could become an issue. If you bring in something and have success, someone less scrupulous will likely grab the name, website, etc., holding you to ransom; and causing you issues with your source.
You'll have to think of marketing at some point. You might want to leverage what works in Oregon; but beware customs, values, etc. might not translate readily - in which case your margin will have to further support such.
If you get to the point where you're looking for a distributor and want to work through your back office processes, building market, incentive-izing your sales team, reporting etc. then consider www.salessuite.net - they've got leaseable, exceptionally affordable products, services and also offer consultancy expertise in how to do such. This will leapfrog you through what is usually a 2 year fog of mistakes.
Once you figure out "how" to do this, you'll be set up to not just do an Oregon brewer, but effectively any US state supplier of alcohol. There are some strong micro-brew brands well known outside their local market (making a name for themselves with tourists and/or the nostalgic secondees overseas). You could also post on Alibaba and be the first to offer access to the Japanese market for beer. As I see it, your idea has more legs to it than just "Oregon Beer or Bust!" (to quote our pioneering fore-fathers).
Let me know how you get on,
Good Luck,
Eric
FYI, from the US side I came across some links that might help too - though I didn't check them
