Key Takeaways
- Retail setup starts with entity choice. GK is faster and founder-friendly (about 2-3 weeks). KK is more credible for landlords, banks, and suppliers (about 3-4 weeks including notary steps).
- Costs jump dramatically when residency is involved. As of October 2025, the Business Manager Visa requires ¥30 million capital plus at least one full-time employee. Total startup cost is typically ¥31.6M-¥32.2M for foreigners needing visa sponsorship.
- Leasing is the real cash shock. Expect 6-10 months of rent upfront (deposit, key money, realtor fees). A ¥200,000 per month shop can require roughly ¥1.2M-¥1.5M to move in.
- Licensing depends on what you sell. Non-food retail usually needs no license. Liquor retail licenses take about 2 months and cost around ¥30,000. Food and beverage add inspections. Food business permits require a Food Hygiene Supervisor and an on-site inspection. Apply about 10 days before opening, with 2-3 weeks processing time.
- Success factor: start permits early (2-3 months pre-launch for liquor, 1 month for food). Align your lease, licensing timeline, and visa plan so opening day is not delayed by paperwork. The visa capital requirement change makes this planning even more critical.
Japan’s retail sector continues to show resilience, with small and mid-sized retailers maintaining strong positions despite e-commerce growth. As of late 2025, retail sales grew 2.7% in the first half of the year, with brick-and-mortar stores still commanding over 90% of retail transactions. This guide explains the process of opening a retail business in Japan in 2026, covering essential topics such as legal structures, costs, permits, and strategies.
Before you can open your store, you’ll need to choose a legal structure. In Japan, most entrepreneurs go with either a Godo Kaisha (GK) or a Kabushiki Kaisha (KK). Both options achieve the desired outcome, but they come with different trade-offs in terms of cost, credibility, and complexity. We hope this article can help you with opening a retail business in Japan. Gather all the information you need to open a retail business in Japan in no time!
Important regulatory change: As of October 16, 2025, Japan’s Business Manager Visa requirements have become significantly stricter. The minimum capital requirement increased from ¥5 million to ¥30 million, at least one full-time employee is now mandatory, and applicants must demonstrate either three years of management experience or a relevant graduate degree, Japanese language proficiency (B2 level or higher, equivalent to JLPT N2), and have their business plan verified by a professional expert. Existing visa holders have until October 16, 2028, to comply with the new criteria.
This is part of our series offering valuable tips on incorporating a business in Japan. To learn more about setting up your company and achieving your dreams, check out our SmartStart service.
Step 1: Legal Structure
GK: Quick, Affordable, and Founder-Friendly
If you’re launching your first shop or starting lean, a GK is often the way to go. It’s similar to an LLC in the U.S.—simple, low-maintenance, and cost-effective.
Why choose a GK?
- Lower startup costs
- No board meetings or complex filings
- Easy to manage as a solo founder
- Fast setup (about 2-3 weeks)
- Incorporation Cost: ¥150,000-¥450,000
- Total start-up Cost (with Business Manager Visa): ¥31.6M-¥32.2M
- Best for: First-time founders, small shops, or lifestyle brands. For more information about Godo Kaisha (GK), check out this helpful article Ultimate Guide to Godo Kaisha in Japan.
KK: Built for Scale and Serious Growth
If you’re aiming for bigger opportunities—multiple stores, outside investment, or long-term growth. A KK offers more credibility and structure. It’s Japan’s version of a joint-stock company, and it’s the go-to for businesses that want to look serious from day one.
Why choose a KK?
- Seen as more credible by landlords, banks, and suppliers
- Easier to raise funds or take out loans
- Required for franchising or IPOs
- Preferred for larger or upscale businesses
- Estimated cost: ¥250,000–¥450,000+
- Timeline: Around 3–4 weeks (includes notary process)
- Best for: Multi-store retailers, import/exporters, or growth-focused brands
We have this amazing article that goes deeper on Establishing and Scaling a Kabushiki Kaisha in Japan
Are you unsure which structure is right for your retail business? That’s where SmartStart Japan comes in. We specialize in helping entrepreneurs choose the best setup for their goals and guiding you through every step of the process.
Step 2: Business Address and Leasing Retail Space
Securing Your Business Address
You’ll need a physical business address to register your company and apply for a visa. Picking the right one however, is more than just picking a spot on the map.
What to Watch For:
Zoning Rules
First, make sure the property is legally zoned for retail use. For food businesses, this often means securing a location with a certified commercial kitchen. When in doubt, ask the landlord or check with the local city office for clarification.
Upfront Lease Costs
Renting a shop in Japan comes with some sticker shock. Landlords typically ask for 6–10 months of rent upfront, which includes deposit, “key money” (a non-refundable gift), and realtor fees. For a Tokyo space at ¥200,000 per month, expect to pay between ¥1.2 and ¥1.5 million to move in.
Visa Compliance
If you’re applying for a Business Manager Visa, a dedicated commercial space is mandatory. Usually, you sign the lease personally first, then transfer it to your company once it’s officially incorporated.
Choosing the Right Location
Beyond foot traffic, consider areas offering local subsidies. Some cities provide grants for opening in vacant storefronts. At SmartStart Japan, we maintain a list of foreigner friendly office spaces to make this step smoother. This will make opening a retail business in Japan so much easier.
Step 3: Licensing & Permits
Not every retail business in Japan needs a license, but if you’re dealing with food, alcohol, or secondhand goods, there are specific requirements to meet.
What You Might Need:
General Retail
Good news: if you’re selling only non-food items (clothing, electronics, household goods, etc.), you typically don’t need a license.
Food & Beverage
Opening a café, bakery, or restaurant? You’ll need a Food Business Permit (食品営業許可 / Shokuhin Eigyō Kyoka) from the local health center (保健所 / Hokenjo). This requires:
- A Food Hygiene Supervisor (食品衛生責任者 / Shokuhin Eisei Sekininsha) designated for the shop
- An on-site inspection of your facilities
- Application submission about 2-3 weeks before your planned opening date
Application timeline: Submit your application after your shop’s interior work is substantially complete but before your opening date. The approval process typically takes 2-3 weeks, including the facility inspection. Plan to apply at least one month before opening to allow for any potential corrections needed after inspection.
Cost: Varies by municipality, typically ¥15,000-¥20,000 for the application fee. Food Hygiene Supervisor training costs approximately ¥10,000.
Selling Alcohol
Planning to sell alcohol in-store or online? You’ll need a Liquor Retail License (酒類小売業免許 / Shurui Kouri Gyō Menkyo) from the National Tax Agency. Key points:
- The license is location-specific (one license per sales location)
- Processing time: approximately 2 months
- Cost: ¥30,000 registration tax (登録免許税)
- Start early: Begin your application 2-3 months before your planned opening
Secondhand Goods
If you’re selling used items (clothing, furniture, electronics, etc.), you must apply for a Secondhand Dealer License (古物商許可 / Kobutsushō Kyoka) through the Prefectural Police. The process involves:
- Background check
- Approximately 40 days processing time
- Cost: ¥20,000-¥25,000
- Requirement to maintain transaction logs for police audits
Other Permits
If you’re dealing with pharmaceuticals, tobacco, or making structural changes to your space, additional permits may apply.
Pro Tip: Start license applications 2-3 months before launch for liquor and secondhand goods. For food permits, apply 2-3 weeks before opening (after interior work is substantially complete). The strict timeline requirements mean you should plan your lease signing, interior work, and license applications as a coordinated sequence.
At SmartStart Japan, we help clients avoid common missteps by handling these applications from start to finish.
Step 4: Business Manager Visa if needed
Understanding the October 2025 Changes
On October 16, 2025, Japan implemented major reforms to the Business Manager Visa (経営管理ビザ / Keiei Kanri Biza) to prevent fraudulent applications and ensure genuine business operations. These changes represent the most significant tightening of entrepreneurial immigration requirements in over a decade.
What You’ll Need:
- Capital: Applicants must demonstrate a minimum capital of ¥30 million (increased from ¥5 million). For corporations, this refers to paid-in capital. For sole proprietors, this means the total investment in business premises, equipment, inventory, and operational expenses (including one year of employee salaries).
- Local Employee Requirement: Applicants must employ at least one full-time worker who is either a Japanese national, Special Permanent Resident, Permanent Resident, Spouse or Child of a Japanese national or Permanent Resident, or Long-Term Resident. Workers on standard work visas (技術・人文知識・国際業務, etc.) do not count toward this requirement.
- Office Space: A leased commercial space is required. Home addresses and virtual offices don’t qualify. Shared office spaces may not meet the requirements – verify with immigration authorities.
- Japanese Language Proficiency: Either the applicant or a full-time employee must have Japanese language ability equivalent to B2 level or higher. Acceptable proof includes:
- JLPT N2 or higher
- BJT (Business Japanese Test) score of 400 or higher
- 20+ years of residence in Japan as a mid to long-term resident
- Graduation from a Japanese university or completion of Japanese compulsory education plus high school
- Business Management Experience: Applicants must have either:
- (1) A doctoral degree, master’s degree, or professional degree in business management or a field related to the planned business, OR
- (2) At least three years of business management experience (includes time spent on startup preparation activities under the Startup Visa)
- Business Plan: A comprehensive business plan must be submitted and verified by a qualified business management expert.
- Residency Requirement: Extended absences from Japan without valid reason may result in visa renewal denial.
Transition Period for Existing Visa Holders
If you currently hold a Business Manager Visa under the old requirements, you have until October 16, 2028 to comply with the new standards. During this 3-year grace period:
- Renewals will consider your current business performance and progress toward meeting new requirements
- Immigration will evaluate whether you have a realistic plan to achieve compliance
- Strong business performance and proper tax compliance can help during the transition period
Considering a Startup Visa?
Cities like Tokyo and Fukuoka offer a Startup Visa (スタートアップビザ / Sutāto Appu Biza), a 6-12-month option (extended to 2 years in some municipalities as of 2025) that allows you to set up without the upfront ¥30 million capital requirement. This is designed as a pathway to the full Business Manager Visa and can be valuable if:
- You need time to establish your business and raise capital
- You want to test your business model before making the full investment
- You can demonstrate a credible path to meeting the full requirements
Note: Time spent on startup preparation activities under a Startup Visa can count toward the 3-year management experience requirement.
At SmartStart Japan, we handle the entire process—from drafting your business plan to collecting the proper documents. Our Visa Transition Checklist ensures that nothing is missed.
Step 5: Expansion Costs
Expansion Cost Breakdown
Once your first store is up and running, the next step may be growth, whether that involves opening new locations or expanding your online presence. But expansion in Japan comes with specific costs and challenges. Knowing this information, it will make opening a retail business in Japan much easier.
Setting up a new store typically costs between ¥3 million and ¥5 million per location. That covers deposits, renovations, and initial stock. You can use your existing company, but each store needs its own permits.
POS Systems like Square or AirREGI cost around ¥5,000–¥10,000 per month, plus a one-time upfront fee of ¥100,000–¥300,000 for hardware.
E-commerce integration starts around ¥200,000 for a basic website, with ongoing costs for marketing and marketplace fees.
Hiring is another significant factor. Expect to pay 1.2–1.5x the base salary once you factor in insurance and benefits. For example, a ¥250,000/month role will cost about ¥300,000 total. The regional minimum wage ranges from ¥900 to ¥1,100 per hour.
Working with Distribution Partners
If you’re considering using a distributor, it’s essential to understand the cultural and legal landscape. This information will be needed when opening a retail business in Japan.
- Language barriers can lead to misunderstandings—contracts should be bilingual, and a local advisor is often essential.
- Cultural differences mean decisions may take longer and rely on trust-based relationships.
- Contracts in Japan are usually shorter, but that doesn’t mean you can skip legal review. Be sure to cover pricing, returns, and termination.
Looking to Partner with a Distributor in Japan? Don’t Miss This Expert Guide from Scaling Your Company
Legal cost estimates:
- Drafting a contract: ¥100,000–¥250,000
- Reviewing an existing one: ¥50,000–¥150,000
- Full support: ¥200,000–¥400,000+
Total Estimated Incorporation
(All costs in Japanese Yen / approximate ranges)
| Category | Godo Kaisha (GK) | Kabushiki Kaisha (KK) | Notes |
| Incorporation (Core Setup) | ¥186,500 – ¥220,000 | ¥431,500 – ¥450,000+ | Includes registration, consulting, seal, etc. |
| Rent Deposit + Key Money | ¥1.2M – ¥1.5M | ¥1.2M – ¥1.5M | Tokyo average: 6-10 months’ rent upfront |
| Company Office Lease (Monthly) | ¥150K – ¥300K | ¥150K – ¥300K | Required for Business Manager Visa |
| Food Business Permit | ¥15,000 – ¥20,000 | ¥15,000 – ¥20,000 | Plus ¥10,000 for Food Hygiene Supervisor training |
| Liquor Sales Permit | ¥30,000 | ¥30,000 | Registration tax; takes 2 months to approve |
| Secondhand Dealer License | ¥20,000 – ¥25,000 | ¥20,000 – ¥25,000 | Apply via Prefectural Police; ~40-day process |
| Legal Support (optional) | ¥50,000 – ¥400,000+ | ¥50,000 – ¥400,000+ | For contracts or franchising setup |
| Business Manager Visa (optional) | ¥226,000 – ¥391,000 | ¥226,000 – ¥391,000 | Visa application support fees only. Does not include the ¥30M capital requirement. Consult with immigration specialist for current costs |
Total Estimated Startup Cost
| Entity Type | Total (Without Visa) | Total (With Visa) |
| Godo Kaisha (GK) | ¥1.6M – ¥2.2M | ¥31.6M – ¥32.2M |
| Kabushiki Kaisha (KK) | ¥1.9M – ¥2.4M | ¥31.9M – ¥32.4M |
Important notes:
- The “With Visa” totals include the ¥30 million capital requirement mandated since October 2025, plus all other setup costs
- The visa application support fee covers professional services but is separate from the capital investment
- Larger or more complex deals involving intellectual property (IP) or franchising may incur higher legal costs
Step 6: Growth Strategy
Once your shop is up and running, it’s time to think about how to grow smartly and sustainably. This information will be needed for opening a retail business in Japan.
Go Multichannel
Don’t limit yourself to just a physical store. Platforms like Rakuten, Amazon Japan, and your e-commerce site can help you reach a wider audience of customers. Tools like LINE are great for promotions and building direct relationships. Add a loyalty program to boost repeat sales and keep your community engaged. Opening a retail business in Japan is much easier.
Localize Everything
Success in Japan means going beyond translation. Think: elegant gift wrapping, seasonal campaigns, and warm omotenashi-style service. Tailoring your offer to local expectations can make a significant difference. See this article for a guide to Japanese corporate culture.
Use Your Data
Your POS system and online sales give you powerful insights. Use them. Track what’s selling, adjust pricing, and time your promos based on actual buying behavior.
Franchising or Partnerships
If your concept is working well, franchising could be a way to grow quickly. Just ensure your systems and training are solid. Not ready to franchise? Collaborate with local influencers, department stores, or hotels to expand your reach without having to start from scratch.
Stay Fresh
Growth doesn’t always mean bigger. It also means better. Keep things exciting with new products, seasonal events, or in-store workshops. Embrace a kaizen mindset: constantly improving, one step at a time.
SmartStart Japan is here to support you at every stage of your journey, from your first store to full-scale expansion, as you will be opening a retail business in Japan in no time!
Final Checklist
- Have you chosen between a KK or GK? If you need a Business Manager Visa:
- Do you have ¥30 million in capital available?
- Do you have at least one full-time employee lined up who qualifies (Japanese national, permanent resident, etc.)?
- Do you or your full-time employee have Japanese language proficiency (B2 level/JLPT N2 or equivalent)?
- Can you demonstrate 3 years of business management experience OR hold a relevant master’s/doctoral degree?
- Have you prepared a comprehensive business plan for expert verification?
- Do you have a location secured that meets visa requirements (dedicated commercial space)? Do you have the correct permits?
- For food retail: Food Business Permit application submitted 2-3 weeks before opening?
- For alcohol sales: Liquor License application started 2-3 months before opening?
- For secondhand goods: Dealer License application started 2 months before opening?
- Planning to live in Japan? Make sure you apply for a business manager visa!
- Want to grow your business even further? Reinvest profits and apply for subsidies in Japan
- Make sure you stay compliant after incorporation! Keep up with tax filings, renew your permits and visa on time, and don’t forget to plug into the local startup community; you’ll learn a lot from your senpais. V
- isa holders: Are you aware that extended absences from Japan without valid reason may affect your visa renewal?
Make sure you stay compliant after incorporation! Keep up with tax filings, renew your permits and visa on time, and don’t forget to plug into the local startup community; you’ll learn a lot from your senpais.
