Costs of failure in Japan are high. Opportunity costs can be even higher when you lose Japan’s market to competitors! If you fail, it may take you 32 years for the chance to enter Japan again.
Consequential costs, and strategic developments can be even more serious than direct costs of failure in Japan
Vodafone’s failure in Japan and sale of of Vodafone-Japan to Softbank laid a key foundations for Softbank’s meteoric rise, including the acquisition by Softbank of chip IP giant ARM, a dominating force for mobile communications and IoT.
- SoftBank acquires ARM Holdings plc: paradigm shift to internet of things (IoT) and a Vodafone angle
- Vodafone Japan fail: Why did Vodafone lose the opportunity of US$ 83 billion value, and help jumpstart the growth of SoftBank
It took IKEA 32 years to enter Japan the second time!
When a company fails in Japan, it may take 20, 30 years to enter Japan’s markets a second time – a very high opportunity cost lost. Actually, most companies that failed in Japan never come back.
IKEA’s first market entry to Japan was in 1974 via a joint-venture, which failed for IKEA and IKEA withdrew from Japan. It took 32 years for IKEA to enter Japan the second time – this second time successfully and with a totally different strategy, see:
Ikea reenters Japan: IKEA’s first try to enter Japan in 1974 failed for IKEA. Now second try in 2006
Can you afford to wait 32 years when you fail the first time in Japan?
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