Paid-in capital: ≈ USD 188,000
A company can legally be registered with JPY 1 of capital, but JPY 30 million is required for the Business Manager status of residence. This is the largest single item.
JAPAN MARKET ENTRY COST
What it costs to enter the Japanese market in 2026
Setting up a subsidiary in Tokyo costs about USD 264,000 to 289,000 in the first stage, most of it capital. Here is the line-by-line breakdown, the rule change that raised it in 2025, and the cost most budgets miss.
Last updated: · By Ken Wada, CEO of REM Inc.
THE SHORT ANSWER
Subsidiary or branch: the first-stage cost
- USD 264k–289k
- Subsidiary (kabushiki kaisha) in central Tokyo
- USD 70k–101k
- Branch office in central Tokyo
- JPY 30M
- Paid-in capital for the Business Manager visa (≈ USD 188,000)
- ≈ 10 months
- Typical office deposit in central Tokyo
Source: JETRO, "How to Set Up Business in Japan: Cost Estimation" (model case, 2026; converted at 1 USD = 159.19 JPY)
LINE BY LINE
Where the money goes
JETRO's model case: a foreign company sets up in central Tokyo with a foreign managing director and one Japanese manager. Figures are for a subsidiary unless noted.
Establishment and filings: ≈ USD 6,200
Registration and license tax, stamp tax and notarization (≈ USD 1,570), professional fees for registration (≈ USD 1,885), Bank of Japan filings, tax filings, and labor and social insurance filings. A branch costs ≈ USD 4,400.
Office: USD 33,000–59,000
Monthly rent of USD 2,800–4,400 for a small office in central Tokyo, a deposit of about 10 months' rent and a brokerage fee of one month. Furniture and equipment add about USD 3,100.
Hiring a manager: ≈ USD 14,600
Recruiter fees, assumed at 35% of the expected first-year salary for a manager in a non-manufacturing business. Salary itself comes on top.
Visas: USD 1,300–3,100
For the foreign managing director, usually handled by an immigration lawyer or scrivener.
Housing: ≈ USD 14,400
Housing for the foreign managing director, starting with an extended-stay apartment for the first three months.
WHAT CHANGED IN 2025
The Business Manager visa now needs JPY 30 million
From 16 October 2025, the capital requirement for the Business Manager status of residence rose from JPY 5 million to JPY 30 million. Applicants must also employ at least one full-time staff member and show at least three years of management experience or a relevant master's degree or higher.
For a foreign company planning to send its own managing director to Japan, this changes the economics of the first year. It makes validating demand before incorporation more valuable than ever.
THE COST MOST BUDGETS MISS
Time: the three-year wall
About 70% of foreign companies withdraw from Japan or scale back sharply within three years. Japanese B2B deals take 6 to 18 months, and every change of country manager can erase 12 to 18 months of relationship building.
Months 1-6
Fixed costs start
- Office, salaries and capital committed
- Few meetings with real decision makers yet
Months 6-12
Pipeline stalls
- "We'll consider it" does not turn into orders
- Head office questions the Japan team
Years 1-2
Reset
- The country manager is replaced
- 12-18 months of relationships are lost
Years 2-3
Exit
- Write-off of the setup cost
- Partners lose trust; re-entry gets harder
LOWER THE RISK
Set up first, or validate first?
Upfront commitment
Set up first
Capital, office, visa and a country manager before the first meeting
Validate first with REM
From USD 4,000 per month plus a success fee. No capital or office needed
Time to buyer meetings
Set up first
Months, while the hire builds a network from zero
Validate first with REM
Meetings with decision makers within weeks, through REM's existing relationships
What you learn
Set up first
Mostly after the money is spent
Validate first with REM
Reactions, conditions and objections from Japanese buyers, in as few as 12 weeks
If Japan is not right
Set up first
Exit costs and write-offs
Validate first with REM
A documented no-go, with the conditions for reconsidering
| Set up first | Validate first with REM | |
|---|---|---|
| Upfront commitment | Capital, office, visa and a country manager before the first meeting | From USD 4,000 per month plus a success fee. No capital or office needed |
| Time to buyer meetings | Months, while the hire builds a network from zero | Meetings with decision makers within weeks, through REM's existing relationships |
| What you learn | Mostly after the money is spent | Reactions, conditions and objections from Japanese buyers, in as few as 12 weeks |
| If Japan is not right | Exit costs and write-offs | A documented no-go, with the conditions for reconsidering |
Source: Incredible Consulting K.K., 2025 (50+ market entries observed by the firm; not official statistics) / REM fees as of October 2026
WAYS TO SPEND LESS
Four ways to lower the cost of entering Japan
Validate demand before incorporating
Meet Japanese buyers first and incorporate only when you have a reason to. This is the single biggest saving.
Start through a partner
A distributor, trading company or strategic partner lets you sell before you set up, at the price of less control.
Use temporary office support
JETRO's Invest Japan Business Support Centers offer temporary office space free of charge for up to 50 business days.
Borrow a team instead of hiring one
Specialists engaged per project bring networks a new hire does not have, and the relationships stay with a team.
FAQ
Japan market entry cost: frequently asked questions
How much does it cost to set up a company in Japan in 2026?
In JETRO's 2026 model case, a subsidiary (kabushiki kaisha) in central Tokyo costs about USD 264,000 to 289,000 in the first stage, including JPY 30 million of paid-in capital. Establishment and filings alone are about USD 6,200.
What is the minimum capital for a company in Japan?
A company can be registered with JPY 1 of capital. However, if a foreign national will manage the company in Japan on a Business Manager visa, JPY 30 million in capital has been required since 16 October 2025.
Is a branch office cheaper than a subsidiary?
Yes. JETRO estimates a branch at about USD 70,000 to 101,000, because no paid-in capital is required. The foreign parent company carries the legal liability, and Japanese buyers often place more trust in a local subsidiary.
How much does Japan market entry consulting cost?
REM's Japan market entry program starts from USD 4,000 per month (excluding tax) plus a success fee tied to the number of qualified meetings, and runs for as few as 12 weeks. Specialist time is quoted per project.
How long until a Japan business becomes profitable?
Plan on a three-year horizon. Japanese B2B sales cycles typically take 6 to 18 months, and relationships, not campaigns, drive the first orders.
JAPAN MARKET ENTRY GUIDES
Keep reading
Talk to a team that has done it five times
Book a free 30-minute call. We look at your product, your target customers in Japan and where you are today, and tell you honestly whether a 12-week validation makes sense. If needed, we sign an NDA before the meeting.