Investing in Japan
Success Stories honestbee Japan
honestbee Pte Ltd., a Singapore-based online grocery delivery service provider, opened its Tokyo office, honestbee Japan, in Minato Ward, Tokyo in October 2016. Founded on the principles of being a social impact business, honestbee Japan aims to contribute to communities by offering flexible employment opportunities to the community, including stay-at-home parents of small children, caregivers for the family and college students. Joel Sng, CEO of honestbee, tells JETRO what has brought honestbee to Japan and how the company will develop its business.
As reflected in the rise of Airbnb, a US-based online marketplace for leasing and renting lodging service, and Uber, an American company matching drivers and users who need a ride, the sharing-economy market, in which people can engage in transactions for property or services, has been growing on the Internet. Against this background, the service provided by honestbee Japan is now creating ripples in the Japanese market.
“Hopefully, fresh seafood sold at the Tsukiji fish market or fruit grown on Hokkaido farms may be delivered to Singapore by the beginning of next year,” Joel Sng, CEO of Singapore-headquartered honestbee Pte Ltd., said during a press conference held on July 20, 2017 to announce the official launch of honestbee Japan. Founded in Singapore by Mr. Sng in July 2014, honestbee delivers food and groceries from popular restaurants and stores to customers’ doorsteps. Since the commencement of official service provision in Singapore, it has taken only two years for the company to establish honestbee Japan in Minato Ward, Tokyo. The company had already expanded operations in seven countries and regions before entering the Japanese market—Singapore, Hong Kong, Taiwan, Malaysia, Thailand, Indonesia, the Philippines.
honestbee Japan’s service works this way: A customer browses the company’s website or smartphone app which displays products of local supermarkets or specialty stores allied with the company. Once decided, the customer places an order online. Then, a grocery concierge called a “Shopper Bee” purchases the products ordered by the customer at the stores, and those products are delivered to the customer by a deliverer called a “Delivery Bee”. The whole process from order placement to delivery to the customer can take less than an hour at the shortest. Unlike online supermarkets, which deliver products from one store or warehouse, honestbee Japan’s service enables a one-shot purchase from multiple stores through a single order, thanks to the company’s partnership with multiple supermarkets and specialty stores. In addition to fresh foodstuff, honestbee Japan also delivers dishes from partner restaurants.
honestbee Japan’s delivery van
Meeting the needs of locals and expats alike
The service provider has joined forces with over 300 supermarkets and restaurants in Tokyo: Tokyu Precce; Asia-Superstore, which is Japan’s largest Thai food store; supermarkets including Costco, a US-based members-only warehouse supermarket; and stores selling fresh foodstuff located at the Tsukiji Outer Market, just to name a few. Since the company’s website is also available in English, honestbee Japan is well-prepared to meet the shopping needs of expats.
honestbee Japan’s major customers fall into the following four categories: (1) stay-at-home parents who are too occupied with child rearing to go out shopping; (2) the elderly who are unable to carry heavy groceries; (3) busy working professionals; and (4) expats. Mr. Sng explains that each of these target groups has its special needs. For example, food delivery is popular with working professionals, while grocery delivery is used by stay-at-home parents. Mr. Sng is confident that the service offered by honestbee Japan “will become not an option, but a must.”
Building win-win relationships with partners
Mr. Sng explains that, when deciding to come to Tokyo, the company assessed the needs of the market. They validated their premise that Japan was in great need of honestbee’s services. Firstly, culturally, Japanese are reluctant to ask others to do housework and therefore unwilling to hire help. Secondly, the number of car owners in Tokyo is small.
honestbee Japan has an edge in that customers can designate a pick-up time by the hour, and also that the company can meet the particular needs of customers in English. For example, customers can make specific requests, such as a preference for “softer bananas,” “meat produced in Japan,” or “products with a three-day or longer shelf-life period.” The function for selecting a delivery time by the hour is made possible by a high-quality app developed by the company. This app excels especially in logistics. Once purchased, the groceries will be handed over to a Delivery Bee waiting at the nearest point.
Since honestbee Japan provides platforms including financial settlement and logistics necessary to receive orders online, partner retailers do not need to prepare any IT platforms or delivery staff. In addition, honestbee Japan’s system enables the retailers to obtain new customers who have not visited their stores before. “These retailers have entered into a partnership with honestbee Japan”, Mr. Sng explains, “because they considered it advantageous” if they could use the company’s online delivery service. The service can achieve a less-than-one-hour online delivery, which would be impossible to realize merely by a single retailer. The partner retailers share a part of their profits with honestbee Japan. In this way, both the retailers and honestbee Japan are successfully building win-win relationships.
Customers also benefit from honestbee Japan’s online delivery system in that they don’t need to drag heavy groceries and that they can shop regardless of time or place. In addition, they can purchase products from distant stores that they were unable to visit before. Advance orders of groceries is also possible. A concierge fee and a delivery fee, each 490 yen (about 4 US dollars), is charged to the customer for the company’s service. However, the delivery fee is waived for total orders of 3,000 yen (about 26 US dollars) or more. No monthly fees are charged.
Aim to contribute to communities by improving convenience and creating employment
honestbee Japan is also flexible in employing Shopper Bee staff: The company hires staff on a flexible time so that those who have only limited time to work—including stay-at-home parents of small children, caregivers for the elderly who cannot work full-time and college students—can work. By making flexible use of these human resources, the company aims to contribute to local communities.
honestbee Japan has also started to receive an increasing number of inquiries from companies, asking about boxed-lunch deliveries, as large as 100 boxed-lunches per each order. To accommodate these requests, honestbee Japan is in negotiations with its partners.
Mr. Sng expresses his aspirations, “We aspire to improve the employment situation in Japan. To give everyone a chance to earn some extra income—even stay-at-home parents, busy caring for their small children, may want to work if they have a few hours of free time. In addition to stay-at-home parents, we also intend to offer positions to retirees. Our goal is to expand honestbee in the same way that a beehive grows.”
Joel Sng, CEO of honestbee Pte Ltd.
On the other hand, Mr. Sng says that there is still a lot of room for growth, given the limited service area. He explains, “Japanese value punctuality more highly than people in other countries. Expanding to new service areas has to go hand-in-hand with retaining our high service levels. It would be worthless to expand if we were unable to deliver on time.” honestbee Japan seeks to enlarge its service area from its current 10 wards—Minato, Shibuya, Meguro, Shinagawa, Ota, Setagaya, Shinjuku, Chuo, Chiyoda and Koto—to all 23 in Tokyo. Furthermore, the company is eyeing expansion into the cities of Yokohama and Kawasaki. To do so, honestbee Japan is now negotiating with Tokyu Corporation.
Mr. Sng enthusiastically says, “We want to partner with a wide range of stores—encompassing supermarkets, boutiques and restaurants—to develop more services that will satisfy Japanese customers.” honestbee Japan will continue to aim at contributing to the local economy, placing emphasis on support for self-sustainability and an orientation toward communities.
Support from JETRO
honestbee Japan stayed at IBSC Tokyo, a facility equipped by JETRO with temporary offices, for 83 business days from June to September 2016 to get prepared for the commencement of operations in Japan. JETRO provided the company with consultation services related to personnel management and taxation proceedings. JETRO also helped the company find an office and referred it to potential partners. Mr. Sng commented on JETRO’s services, saying, “Companies need to focus on business. JETRO was very helpful because it provided us with the temporary office and referred us to various consultants when we were busy launching our business in Japan.”
(Interviewed in September 2017)
|December 2014||Establishment of honestbee Pte Ltd. in Singapore|
|July 2015||Operations start in Singapore|
|December 2015||Registration of honestbee Japan in Tokyo|
|January 2016||Operations start for the seasonal service in Niseko, Hokkaido|
|October 2016||Opening of office in Minato, Tokyo|
|January 2017||The second season of operations start in Niseko, Hokkaido|
|July 20, 2017||Announcement of official launch of honestbee Japan|
|Business Overview||Provision of online concierge and delivery service (handling perishables mainly)|
|Parent company||honestbee Pte Ltd (Singapore)|
|Address||Nishiazabu ST Building, 3-23-14, Nishiazabu, Minato-ku, Tokyo, 106-0031, Japan|
- Lease of a temporary office (IBSC Tokyo)
- Provision of consultation services related to visas, personnel management and taxation proceedings
- Finding an office and a bank
- Referral to potential partner companies