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Research for organic textile - Essay Example

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From the early 1990s to date, Japan as a country has continued to grow economically with most nationals belonging to the middle class - with considerably high income levels (Cypher & Dietz 2004). According to Heita (2000), Japanese have a strong liking for European culture and…
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Feasibility Studies Business Environment in Japan From the early 1990s to Japan as a country has continued to grow economically with most nationals belonging to the middle class - with considerably high income levels (Cypher & Dietz 2004). According to Heita (2000), Japanese have a strong liking for European culture and greatly prefer to adopt styles, luxury brands and fashion that originate from England, U.S.A. and France.
Out of environmental concerns, organic textile products have been preferred in Japan but making sales for environmental reasons has remained low in the past; most buyers of such products are drawn by nature–oriented fashion. Other buyers opt for organic textile products for their children’s allergies or their sensitive skins. For this reason very few companies deal in organic textiles, most of them importing organic raw material and processing them in China or Japan while others importing end-use products from U.S.A. or the European Union (Joca, 2001). Being that Japanese consumers like reliable certification, most organic textile products sold within the country come from the U.S.A who’s certification standards on products is known to be quite stringent..
While Japan consumes over 800,000 tons of cotton products yearly, only between 300 to 350 tons are of organic cotton material. Most organic textiles are sold in cooperative stores, department stores, specialty stores and natural food stores. Most supermarkets do not sell organic textiles and most businesses deem catalogue, mail-order and online business favorable for organic textile products in the country.
Currently, the market for organic textiles in the country is growing gradually with their prices closely matching those of high level branded clothes sold in department stores. The high prices are more as a result of small-scale production and high cost of raw US cotton. Most organic textile products sold in Japan are uncolored and unbleached with a gradually growing need for new styles, blends, printed or dyed products.
In order to establish a business in Japan, a minimum of one yen is required but under certain conditions; within five years the business must have a minimum capital of between three and ten million yen depending on the type of business (Jref Inc., 2009). A minimum registration fee of 181 yen is also charged for startup businesses; these cover a whole range of licenses and permit fess.
Business Environment in Los Angeles
According to the Organic Exchange and Organic trade association, apparel account for about 85% of retail organic products in Los Angeles (Singleton, 1997). The home textile s segment of the market has achieved double-digit growth rates each year with predictions showing that this growth is bound to be maintained for several years to come. In particular, people in Los Angeles prefer eco-friendly home textiles with brands such as Bed Bath & Beyond and Ralph Lauren Home being popular. Statistics show that Los Angeles and the US as a whole, due to global competition, has a trade deficit in both home textiles and organics – the demand of organic textiles far exceeds supply (Singleton, 1997).
In order to establish a retail business successfully in LA, a number of permits and licenses have to be obtained (LA public library, 2009b). These basically include federal tax, state tax, city tax, and county permits and licenses (in some cases) and a number of departmental licenses depending on the business (LA public library, 2009a). These are however quite affordable and go a long way in ensuring that the business operates in a more secure environment (LA public library, 2009a).
Conclusion
Compared to the US and Japan, the cost of labor and production is quite low in India. This in effect means that producing raw material and processing it in India would considerably reduce unit costs. Further, India has well developed transport and communication infrastructures that go a long way in ensuring that export goods reach their destinations in good time (World Fact Book, 2009). Further, India has good trade relations with the European Union, the United States, Japan and numerous other countries making it a preferred source of textile products.
In terms of transportation and export costs, exporting products from India to Japan would be slightly fair compared to Los Angeles. In view of the above facts stated above, and with greater emphasis on the organic textile markets in Japan and LA, it would be better to establish a retail organic home textiles business in Los Angeles as opposed to Japan.
References
Cypher J.M. &Dietz J. L. (2004). The process of economic development. Oxford University Press.
Heita K. (2000). Asia Pacific Dynamism 1550-2000.‎ Oxford University Press.
Joca. (2001). Market Situation of Organic Cotton Products in Japan. Retrieved 26th September, 2009 from http://www.joca.gr.jp/english/market.html
Jref Inc. (2009). Setting up a Company in Japan. Retrieved 26th September, 2009 from http://www.jref.com/practical/company.shtml
LA public library (2009a) Licenses and permits. Retrieved 26th September, 2009 from http://www.lapl.org/resources/guides/startbus/4license.html
LA public library (2009b) Business taxes. Retrieved 26th September, 2009 from http://www.lapl.org/resources/guides/startbus/3tax.html
Singleton J. (1997). The world textile industry. Oxford University Press
World Fact Book. (2009). India. Retrieved 9th September, 2009 from https://www.cia.gov/library/publications/the-world-factbook/geos/in.html
Instructions
Hi Steve,
We are trying to find the following solution
Cost Feasibility (Which market to go, as in shall we have our retail in LA or Japan)
You need to find the cost of starting a retail, the advantages, and the cost of exporting organic textile from India to that market.
Product research ( finding the suitable product for suitable market) For example, should our product be organic clothing, organic towels, which has anything to do with organic textiles.
So basically you have to research which market and what kind of product will best for us based on organic textiles.
Please let me know if you have any questions. Read More
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