辦公空間小貼士
23/05/2025

Why a Physical Office is Still Key to Business Success in Japan

Japan offers foreign companies much in terms of business potential, thanks to its stable economy and innovative market. But you need to understand the country’s unique cultural norms to navigate its corporate landscape. One way is by looking at how remote working has become popular across the world, with the share of employees clocking in from outside the office growing from 20% in 2020 to 28% by 2023. This has changed the way companies operate, communicate, and collaborate. 

However, Japan stands apart as traditional business etiquette is still important and places considerable value on face-to-face interactions. Having a real-world office is also a statement of commitment, stability, and long-term intent — making it not just beneficial, but essential. It strengthens business relationships through physical presence, helps foreign entrepreneurs meet legal requirements, and strategically positions your brand.

How Japanese Business Culture Impacts the Need for a Physical Office

Japanese business culture is dictated by respect and hierarchy. Personal interactions like exchanging business cards (meishi koukan) and attending formal meetings are considered crucial. Hierarchical respect plays a big part in corporate dealings, where seniority commands explicit acknowledgement often shown through physical presence and attention to detail. The concept of “face,” or maintaining dignity and humility, influences every interaction. 

In this landscape, having a physical office demonstrates respect by showing that you value and acknowledge the relationship enough to make tangible commitments. For instance, executives often visit offices personally before finalising significant agreements, interpreting physical presence as a sign of trustworthiness. Being physically present and investing the effort required by local customs communicates sincerity and strengthens partnerships significantly.

Then there’s the matter of brand perception and trust. An office in a prestigious district or reputable building signals professionalism, financial stability, and long-term vision. Clients and partners think a business is more credible when they see high-quality office facilities, a convenient location, and an aesthetically done-up reception area. 

Different Types of Office Spaces Available in Japan

Business owners in Japan can choose from traditional private offices and contemporary coworking spaces with dedicated or hot desks, to hybrid offices that combine the benefits of both these models.

  • Private offices: Conventional private offices that offer secure, enclosed workspaces emphasising privacy, hierarchy, and professionalism — essential for formal meetings and aligning with Japan’s deeply ingrained values of respect and organisational structure.
  • Serviced offices: Workplaces known for their furnished, flexible, and ready-to-move-in setups, which make them ideal for startups that want to enter the market quickly. They’re usually typically located in central, prestigious business districts and easily accessible for employees and clients. 
  • Co-working spaces: Collaborative work environments with open-plan desks, and best suited to networking. Their modern design and facilities make them popular among startups and tech ventures. 
  • Virtual offices: These cost-effective options give business owners an address for registration, administrative support, and mail handling without a physical workspace. 
  • Hybrid models: This option allows companies to adapt to changing workforce trends, scale up or down as needed, and control costs by providing the benefits of private offices and shared work areas. 

How a Physical Office Supports Japan’s Legal and Visa Requirements

A dedicated office in Japan is vital as it’s often mandatory to meet local compliance standards and provides that all-important stamp of credibility. Foreign entrepreneurs applying for Japan’s Business Manager Visa require brick-and-mortar, lockable office spaces, which means that virtual offices don’t fulfil immigration criteria. Physical office addresses are also essential for opening bank accounts, completing government paperwork, and adhering to tax regulations. And while virtual offices are economical, they don’t satisfy any of these requirements. They also fall short in several other ways — they lack legitimacy among local partners, provide no space for important meetings, and do not meet visa conditions.

How Office Design Boosts Productivity in Japan

Investing in office design goes far beyond aesthetic benefits as it can boost employee morale by contributing to creativity, collaboration, and sustained productivity. According to a study by Hosei University, there is a clear link between office design and employee productivity in Japan. Research found that Indoor Environmental Quality (IEQ) — which comprises air quality, lighting, acoustics, and layout — directly influences efficiency, comfort, and overall employee satisfaction. Factors like poor lighting or inadequate ventilation can have a negative impact on performance, therefore increasing absenteeism and presenteeism, a common issue in Japanese work culture. On the other hand, a pleasant work environment can even attract more talent and reduce turnover, and in the process impacts a company’s competitive edge and long-term viability.

Costs and Conditions Involved in Renting an Office in Japan

Renting office space in Japan involves understanding unique practices so that businesses can anticipate their initial costs and avoid unexpected expenses. A prime example is the concept of reikin, or key money, which is a non-refundable gift to landlords and usually amounts to 1-2 months’ rent. Another concept is shikikin, a refundable deposit usually equivalent to several months’ rent. Other costs like hoshokin (security deposits) might also apply, which tenants get back when a contract ends or is terminated, minus cleaning fees or damages. 

Business fees also need to factor periodic costs like maintenance charges and koushinryou (renewal charges) into their budgeting. Contracts often stipulate that tenants return an office to its original state when they leave, which sometimes results in substantial restoration fees. Companies can lower upfront charges and ongoing obligations by negotiating these terms clearly from the start. 

What to Consider When Choosing an Office Location in Japan

There’s a lot that goes into picking the right office location in Japan. For one, it’s important to be close to transportation hubs, especially train stations, as using the rail system is the most popular way to travel around Japanese cities. Don’t forget to take district reputations into consideration when deciding on a company address. Take Tokyo, for instance, where areas like Shibuya and Shinjuku cater to tech-oriented companies, while Marunouchi is the city’s commercial business centre. 

Choosing a location near industry clusters or client bases boosts brand visibility and helps with operational efficiency. Startups and small businesses with growth plans should select an office address with the goal of laying a foundation for future expansion. This will instill confidence in potential partners and make them relevant in Japan’s diverse business environment.

Physical offices still hold strategic, cultural, and legal importance in Japan. Alternatives like co-working or virtual offices offer temporary cost savings, but they may not always satisfy business etiquette expectations and compliance regulations. Options like serviced offices in well-appointed commercial buildings may well be the answer for smaller businesses or new entrants who want the prestige associated with larger, established corporations but at a more affordable price.

Ready to Expand Your Business in the Japanese Market?

Establishing a physical office in Japan is a vital step to build trust, meet regulatory requirements, and enhance your brand’s presence. If you’re eager to seamlessly integrate into the local business landscape and foster strong partnerships, get in touch with us now. Our dedicated team will offer comprehensive support, from location selection to compliance, ensuring your office space propels your business toward thriving success. Don’t miss your chance to succeed in Japan—act today!