#206 | 5 Lessons Every MedTech Company Should Learn Before Exporting to Japan

So the one thing that you're gonna learn in this episode is why a lot of med tech companies start their Japan strategy in the wrong place and where they should start instead Welcome to Clinician to CEO, the podcast helping clinicians simplify your go-to-market strategy so that you can stop guessing and turn your working prototypes into international MedTech businesses. I'm your host, Hakeem Aade. Let's get started. So the three things that you're gonna discover in this episode is number one, why products that succeed in Europe and US don't automatically succeed in Japan.

Number two, how to avoid wasting time and money when evaluating the Japanese market. And number three, why the right market entry strategy depends on the size of your business, not just the size of the opportunity. So let's get straight into it. I'm gonna give you five key takeaways from my conversation with Japan MedTech expert, Kurt Jenuin.

So takeaway number one, don't confuse market size with market opportunity. And if you've been listening to my podcast for any period of time, then you'll you're never gonna fall into that trap, are you? So Japan, whilst it is the third or fourth biggest healthcare market in the world, which is very impressive, The size of that market doesn't automatically translate into it being the right market for your product. And you know that.

I know you do. So one of the points that we discussed repeatedly throughout the episode is the success in the US or Europe doesn't automatically translate into success in Japan because you've got different reimbursement systems, you've got different buying behaviors, you've got different quality expectations, which we're gonna talk about later. So the question has to move away from is Japan a big market? 'Cause we all know it is.

The question that we should be asking when you're focusing on and you're looking at entering Japan is, is Japan the right market for your product? So the action I want you to take here based on this takeaway is if you're already pursuing Japan, stop for fifteen minutes and answer these three questions. Number one, what evidence do you have that Japan is a genuine opportunity for your product? Number two, what assumptions are you still making about the market?

And then number three, what is the biggest thing you still don't know? Because one of the biggest risks in international expansion, and Japan is no different, is not what you actually know, it's what you think you know, i.e., those assumptions.

Okay, so moving on to takeaway number two, understanding comes before action. Because Lots of companies will rush into activity, and I talk about this on all of my episodes, to be honest, because companies mistake activity for actually delivering success. So they'll go off and start talking to distributors, regulatory work, booking flights, all of the activities that come with entering a new market. And people do this before they've properly assessed the market.

And we looked at that decision scenario in the episode, And Kurt's answer to that scenario was very simple when I gave him several different options. He said, Understand the market first," because once you start regulatory work or commercial discussions, you're starting to spend money. And if you're not spending money, you're at least consuming resources, even if that resource is only your time. And you know that you've got very precious little of that when you're starting to go into markets and when you try to grow in international business.

And if you've chosen the wrong market, then unfortunately, a lot of the times all you're doing is becoming very efficient at working on a mistake that you've made at the outset. So we want to avoid that, obviously. So the action here is before entering any new market, answer these three questions. One, is there a genuine demand?

Two Can we access customers? And three, most importantly, can we make money in this market? Because it's not just about turnover, it's about the cost to access that market. So if you can't answer all three, then stop Don't go any further and do more homework.

Takeaway number three Japan rewards quality. I told you we'd come back to this. One of my favorite examples that came up in the episode was when Kurt started talking about the Timex watch story. And just to remind you, customers weren't buying the watches because the secondhand didn't perfectly align up with the markers on the watch face.

Now, most people wouldn't even notice that, but obviously the Japanese customers did and will continue to notice things like that. And that's a really important lesson because Japan often exposes weaknesses that other markets tolerate, and that applies to everything really. So it could be product quality, it can be packaging, it can be documentation, it can be your training, it can be your customer support, it can be absolutely anything and everything. The good news is, however, from my point of view when I look at it, is that if you are able to meet Japanese quality standards, you're probably then gonna have standards which are higher than everywhere else in the world, and it means that you're gonna improve your performance for all those other markets, which obviously is an added benefit.

So it's a really good news story. Rather than looking at it as a negative, look at it as a positive. So the action point here is ask a customer, a distributor, or a colleague what's the one thing about your product or service that isn't quite good enough, and then go and fix it. Because in the markets outside Japan, then you have to ask that question 'cause people will tolerate just about good enough.

But in Japan they won't. If you fix it before you go into Japan, you're gonna have a head start over most other companies that get into Japan. So you're not gonna have to start fixing things retrospectively, hopefully. Now, moving on to takeaway number four, distributor selection is too important to rush.

And again, I've said this in lots of episodes, Japan is no different. And this is probably one of the biggest practical lessons from the episode because as many companies will meet someone at a trade show and think, "Great, we found our distributor." No. As I've said to you many times before, you found someone who says they're interested.

Those two are not the same thing. And in Japan specifically, this is even more important because changing distributors can be very difficult, very expensive, but more than anything else, it's very time-consuming. So therefore, a bad decision can easily cost you years in Japan, where it may be months, in other markets. So therefore, it's critical that you evaluate before you sign any distribution agreement.

You have to evaluate the regulatory capability. The sales capability, the reputation within the market, you have to look at the market coverage. You have to look at product synergies, and then you have to look at their focus. Because all these things lead to you getting the right distributor.

And if you get the right distributor, that can really help accelerate your growth in all markets, but specifically in Japan, and the wrong distributor can then stop that growth completely. This is basically everything I always say, but magnified a hundred times for the Japanese market. And the action that I really want you to take here is review your current distributor selection process. If you don't have a structured scorecard, then create one.

And if you're not sure how to do it, just drop me a message, with the link in the show notes, and I can help you with that. But The key thing is never choose a distributor based on enthusiasm alone. And now onto the fifth and final takeaway. There is no universal market entry strategy.

One of the things that I liked most about when we were discussing, market entry into Japan with Kurt was his emphasis on context, i.e., a five million company shouldn't behave like a five hundred million pound company, and a startup shouldn't behave like a multinational. The right strategy has to depend on what your resources are and what your experience is, and your infrastructure and your objectives.

Sometimes that means using consultants, sometimes it means building internal capability. and Sometimes it means going direct depending on where you are in your journey. So the mistake is assuming there's one right answer for everyone, 'cause there isn't. And the action I want you to take here is write down which of these best describes your business today.

Are you an early-stage company needing market guidance, or are you a growing company building international capability, Or are you already an established company capable of investing directly? Then once you've answered that question so you know where you are, ask yourself, are you pursuing Japan in a way that matches your resources and your experience? Because one of the fastest ways for you to waste time and money is trying to behave like a company that you're not. So my closing thoughts are when companies think about Japan, they often focus on regulatory approval or distributors or cultural differences, which all of those are valid.

But after having that conversation with Kurt, I think the real lesson is much simpler. Japan rewards preparation, and the companies that succeed aren't necessarily the biggest. They're the ones that take the time to understand the market before they try to sell into it. So this week before asking how do we enter Japan, ask have we done enough to understand Japan?

Because the quality of your market understanding will often determine the quality of your market entry. And if you're building a MedTech business and you're not sure whether your next move should be around evidence, market access, commercialization, distributor strategy. Or adoption. Do not guess.

Book a healthcare export accelerator diagnostic Call with me. Use my link in the show notes. And in that session I'll help you identify the specific constraints blocking your momentum and the commercial move most likely to unlock your progress. Thanks for tuning in.

Until next time, thanks for listening. Keep challenging your assumptions and keep growing.