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Why foreign businesses are choosing Yokohama over Tokyo when expanding into Japan

by | Mar 10, 2020

Yokohama City, as a historically international city and the second largest in the country, is one of the most popular locations for global companies seeking to expand their business and enter the Japanese market. The city offers many unique incentives and benefits for foreign companies, and the established base of globally international companies in Yokohama give new companies ample opportunity to create new partnerships and meet new clients. For these reasons, global companies from all over the world are continuing to choose Yokohama even over Tokyo when expanding their business into Japan.

Yokohama hosts a number of incubation and startup offices with specialized support for global companies setting up their offices in Yokohama. One facility that offers office space is the German Industry Park (GIP). Despite the name, the facility offers leased space to foreign companies from all over the globe for research and development activities, which includes office space and warehouse/production space. As a result, GIP hosts a large assortment of foreign companies (including many that are, obviously, based in Germany), and is an important part of Yokohama’s international R&D community.

In terms of more general incubators, the Yokohama World Business Support Center (WBC) provides space as well as business services and free consulting to foreign companies, making it an excellent staging ground for foreign companies to establish a foothold in Japan before opening up their full office in Yokohama. In addition, Yokohama is home to the largest WeWork facility in all of Japan, with a unique in-house support center for life-science SMEs and startups. Located within Minato Mirai, the most modern of Yokohama’s premier business districts, the WeWork Oceangate Minatomirai coworking space offers lots of beautiful space for representatives from both entrepreneurs and large corporations.

Many industries are flourishing within Yokohama City, including Information Technology (IT) and Internet of Things (IoT), Life Science, Advanced Manufacturing, Automotive/Mobility, and while the city has seen an influx of global companies from all across the industrial map, the largest concentration continues to be represented by those main industries. For example, we reported that last year 7 global automotive companies (5 foreign and 2 Japanese) opened offices in Yokohama. Besides from these, three other examples of companies that expanded into Yokohama last year are the Italian car parts manufacturer Agrati, the German precision tool software developer CIMSOURCE, and the French electronic onboard systems development group ACTIA.

Agrati opened its Japanese subsidiary Agrati Japan LLC in Yokohama on October 18, 2019. Before opening its Japanese subsidiary, the Italian-based Agrati Group, established in 1929, operated in Europe, the USA, and China, producing around 40 million automobile parts per day. Now, by adding the Japanese market to that list, Agrati has access to entirely new customers. Agrati Japan will be working in the manufacture and sales of automotive parts (bolts, nuts, advanced products, etc.) while providing technical and consulting services for products in Japanese to local clients. Agrati Japan will be currently working out of WeWork’s Minato Mirai Oceangate location in Yokohama. Yokohama City has a high concentration of global automakers and other auto-related companies, and by opening a Japanese subsidiary in Yokohama, Agrati is now aiming to increase market share with Japanese automakers and component manufacturers.

CIMSOURCE Japan Co., Ltd. was established by Germany-based CIMSOURCE on September 20, 2019, near Yokohama’s Kannai district. CIMSOURCE provides multiple services, including the development and provision of a software platform that connects manufacturers and users of precision tools. It also delivers manufacturer-provided tool information data through a digital platform to tool users. For toolmakers, it acts as a distributor of products, and for tool users, as a supplier of rich tool data. By opening a Japanese subsidiary, CIMSOURCE aims to provide this service in the Japanese market and connect with local potential client companies.

Also on September 20, 2019, the France-based ACTIA Group’s new Japanese subsidiary, ACTIA Japan Co., Ltd., officially began operations from within Yokohama’s World Business Center. The ACTIA group designs, manufactures and provides operation support for vehicle communication network equipment (Electronic Control Unit (ECU), Transmission Control Unit (TCU), Diagnostics (Diagnosis), etc.) for large vehicles such as passenger cars, trucks, and buses. Through its new Japanese subsidiary, Actia is looking to utilize its many years of experience on automotive-related electronic equipment to adapt to and meet the demands of the Japanese automobile market, and to create new partnerships and business with local companies.

One of the major benefits of relocating to Yokohama is the city’s central location, providing easy half-hour access to other nearby cities like Tokyo, drastically increasing the effective pool of potential partner companies.For example, Baltimore-based biotechnology company Elixirgen Scientific just opened up a new Japanese office very near to Yokohama in Kawasaki. Elixergen Scientific is focused on stem-cell related technology, and provides reagents, kits, and services at an affordable price to research facilities and laboratories. The nearby presence of such global companies is another strong reason why many companies choose to locate in Yokohama. Companies in and around Yokohama form a large part of Yokohama’s two major business network and support groups: Life Innovation Platform (LIP.) Yokohama, and IoT Open Innovation Partners (ITOP) Yokohama. While primarily providing support and networking opportunities in Japanese, these networks can still prove essential to foreign companies in Yokohama with Japanese-speaking representatives by providing valuable information and opportunities to connect with other local companies.

For more a detailed look into Yokohama’s specific incentives for foreign companies, please check out our Business Support & Incentives page. In addition, learn more about all of the factors that attract companies to Yokohama on our Why Yokohama page.



Yokohama City’s Business Support and Incentives for foreign companies

German Industry Park

Yokohama World Business Support Center



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