Knowledge

Marek Lehocky
Marek Lehocky
CEO and Founder of Kreston Proworks

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Marek Lehocky is the CEO and Founder of Kreston Proworks, a business consulting firm in Japan. Born in Slovakia, Marek has studied and worked in Slovakia, the United States, and Japan, gaining extensive experience in management consulting and large-scale project management. He has been involved in start-ups, mergers and acquisitions, and privatisation projects, including major ones in Eastern Europe. Marek is dedicated to enhancing business support services for companies in Japan, Hawaii, the US, and Asia, leveraging his expertise to help businesses succeed in diverse markets.

Japanese SMEs and business culture

July 31, 2024

Japan’s results in the interpreneur report set them aside from most countries. Understanding the culture is key to doing business there effectively. We explore some of the more surprising results of the report with Marek Lehocky, CEO and Representative Director of Kreston Proworks, Japan, and use his experience of doing business in the country to understand the results.

Global expansion

Only 59% of Japanese SMEs expect an increase in overseas expansion within the next year, a figure significantly lower than the global average of 86%. Preferred expansion regions include neighboring markets in South Asia (38%) and North Asia (30%), with North America (28%) and Western Europe (18%) also on the radar.

Lehocky explains that “Compared to regional peers, Japan is showing greater caution towards global expansion and growth patterns, likely tied to domestic labour and economic pressures.”

Challenges in Global Mobility

The path to international success can be fraught with challenges. Japanese SMEs cite finding local partners (30%), understanding complex compliance requirements (30%), and adapting logistics (29%) as their biggest hurdles. These obstacles highlight the critical need for local expertise.

Lehocky stresses the importance of collaboration with local partners, stating, ” For those entering into the Japanese market, this report highlights the importance of working with a local in-bound specialised partner who can bridge the regulatory, cultural and commercial forces to ensure a productive entry into a dynamic market.”

A different viewpoint

The survey reveals interesting divergences between Japanese entrepreneurs and their global peers:

  • Cybersecurity: 38% of Japanese respondents see cyber threats as a significant risk.
  • ESG Priorities: Only 19% prioritise ESG, compared to a global average of 37%.
  • Access to Capital: Japanese SMEs are less likely to use private investment (21% vs. 47% globally) or venture capital (23% vs. 43% globally).
  • Global Tax Confidence: A mere 9% feel extremely confident about understanding international tax rules.
  • AI Preparedness: 21% do not feel prepared to harness AI within the next two years.

Despite these cautious perspectives, Lehocky identifies clear opportunities: “For those that have expanded internationally or are looking to enter Japan, the benefits are evident. Japan offers strong market growth opportunities and several competitive advantages for businesses operating in the region.”

If you would like to speak to an expert in Japan, please get in touch.