How to Easily Start a Successful JDM Import Business

If you've ever wondered how people get started with importing Japanese vehicles and how you could, you've come to the right place! In this article, I will run you through all you need to know to start importing JDM cars through the Japanese Auctions and starting your very own JDM import Business. 

I’ve broken down the whole process into sections so it’s easier to understand, and some advice based on my experience working in this industry. The process will get easier and less complicated as you go down the list because after the initial phase is done, the exporter will take care of and be there with you throughout the sourcing and buying process (assuming they are good at their job!). It will also get much easier once you’ve done the process once or twice.

Research import regulations

This is perhaps the most important step in starting your very own JDM import business. Every country has its import regulations, import charges, and registration processes. Figuring out what they are early on will help make things a lot easier.

The US, for example, can only import Japanese cars older than 25 years and requires an import broker to help with the import process and release the vehicle(s). Import duty is 2.4% for cars and 25% for trucks. Registration is relatively simple at the local DMV. Full guide for US importers here. It is important to note that proper paperwork is crucial when importing JDM cars. ZervTek will take care of all of that for you. Importing JDM imports such as the iconic Toyota Supra, as they are 25 years old and fully exempt from EPA and NHTSA/FMVSS regulations, making it 100% federally legal to drive on US highways.

Meanwhile, in Australia, shipping is postpaid and packaged together with duty and GST based on the commercial value of the invoice. A special permit called the Vehicle Import Approval (VIA) is required before we can ship. Australia also requires special compliance to ensure the vehicles meet Australian road and safety standards, which tends to cost more if the vehicles have aftermarket parts. A full guide is here if you want to start a JDM import business in Australia.

The UK has no import regulations, just the VAT and import duty. Then, get vehicle approval to show that your imported vehicle meets environmental and safety regulations. You’ll need proof of approval to register the vehicle.

The import regulations research must also include whether you must register as a company to import. Most countries will have a limit to the number of vehicles an individual can import before they need to register as a company. If you’re just starting out with your JDM import business and can import as an individual, do that until you’re settled in.

Make sure you’re very versed in importing the vehicle into the country. This will help towards the end of the process since Zervtek takes care of everything up until the destination port.

Start-up costs

I've seen two business models for JDM import business “start-ups” as exporters that keep recurring: finding customers looking for JDMs and importing a vehicle for them, then making a sale.

This requires talking to people and building connections. Essentially, you’re looking for a customer willing to pay a security deposit in exchange for sourcing and importing a vehicle for a set, pre-agreed-upon fee. You can set the payment terms. 

This usually means using your funds/capital and importing vehicle(s) that you think would sell. This lets you control and set your prices, potentially leading to higher profit margins (or losses if you calculate incorrectly).

The difference between the two methods is that the second method can yield a lot more profit if done right but carries a bit of a risk since no customer is guaranteed a purchase. Most new importers who worked and matured during their time with us used one of the first methods and went on to mix and match the two processes.

I often tell new people entering the JDM import business not to rush. Start slow, test the waters, and see how it goes. We’ll be here for you.

The buying process

Auctions vs Dealer Stock

There are usually two methods for buying a vehicle from Japan: an exporter’s stock and Japanese auto auctions. The Japanese auctions may seem daunting, especially when you’re starting out, but there’s a reason why we recommend them, especially for importers looking to do this as a business.

The Japanese auctions are a big network of different auction houses holding their auctions once a week. The sheer number of auction houses means that there are several different auctions per day from Monday to Saturday throughout Japan, giving you a ton of options per model.

If you were looking at an exporter stock, you would not only have to consider their (sometimes an insanely high) profit margin for a vehicle that was most likely bought from the auctions but also get a limited amount of vehicles to choose from.

The Japanese auctions will:

• It gives you a lot more options to pick from.
   
• Set your custom budgets per vehicle depending on the year, mileage, condition, etc.
   
• Buy at wholesale prices that Japanese dealers/exporters buy at.
   
• A flat exporter fee will be included in all the charges within Japan.

Find a full guide to the auction process here.

What the exporter will do for you

Pre-auction

This is how the process usually works for our customers and us; it could vary depending on the exporter. 

1. Customers will register on our Japanese auction website. It's completely free, and you can check for upcoming cars and previously sold-out vehicle data. 
    
2. We will provide you with recent sales data, help you with budget estimates, and our opinions on various things to help you during the initial search.
    
3. Once the vehicle and budget are narrowed, we will move on to the searching phase. This could involve us sending you options or you sending us links to vehicles you’re interested in (typically, if you’re looking for a few different models simultaneously).
    
4. In some cases, older and rarer vehicles are usually inspected to obtain more photos and videos to ensure their condition. The auction sheet is usually enough for newer cars. We have an article on inspections with a real-life example of photos/videos of what you can expect. 
    
5. After the vehicles are decided, bid and purchase.

Post-auction

1. Transport the vehicle to the port yard. If the customer purchases an oil-leaking or low-down car, it must be fixed before it can be shipped. Additional charges will incur, but we will inform you about the charges and issues or avoid them before the auction.
    
2. Arrange to ship and be waitlisted until a booking is confirmed for the vehicle, and receive and convert documents to make the vehicle exportable.
    
3. Carry out any cleaning or inspections if required by the destination country (We will figure it out, so you do not have to worry about whether it’s required or not).
    
4. Ship the vehicle.

Relationship with a Japanese exporter

This is very personal advice from my work in this field over the last few years. It will vary from exporter to exporter, but this is how it is for me and our company.

Importing means you will develop a relationship with the exporter as a company and a personal relationship with the agent in charge (maybe more). You will be in constant contact almost every other day for years to come, talking about upcoming cars in the auctions, translations, and inspections for those vehicles, market prices for a vehicle you’re interested in, or after-purchase updates.

Working with people who understand and respect our pricing is typically easier. While it’s okay to try to negotiate, the prices are set carefully, considering our operating costs and what we think our time and efforts are worth.

There may be exporters with lower or higher pricing, and that’s fine. We are what we are and our services offer actual depth with brand equity, and loyalty. Along with things like educating the customers on everything (check the entire site) and making sure they feel safe with us, apologizing if things beyond our control happen (like shipping delays), or trying to fix a strut bar onto a jacked-up RX7 for 5 hours because that customer is valuable to us and constantly evolving trying to do things better and faster for our customers because long-lasting relationships with recurring imports are everything to us.

In my opinion, a longstanding relationship built over years on trust is not worth being replaced by trying to make a few extra bucks, possibly for worse service.

Having a trustworthy relationship with an exporter that goes both ways will be one of the core pillars of this business. Regardless of whether it’s us or not, if you find a good exporter you can trust, stick with them.

What to avoid with an exporter

• Don’t make payments via Union or Western transfers. Always either use PayPal or transfer to registered Japanese banks.
   
• Check reviews and exporter websites – not the listed units, but the content.
   
• Cheaper prices would also mean they keep a hidden margin on shipping. This is very common when customers say “That place is cheaper”. Well, you’re probably getting ripped off on shipping.

A JDM import business: few key things to success

Think long term

Most of the successful importers I’ve met and grown together with us from their first car usually had one thing: They were dedicated to building a brand and a long-term business- not a one-off sale to make a few bucks fast. They often search for new connections and customers, fix up vehicles if needed, and work on their brand.

Be realistic about your budgets

Cheap cars are good, and good cars aren’t cheap. It’s very subjective, but the point is to be more realistic about the market in your country, the current prices in Japan, and what condition/mileage/year range your budget can afford. This will save you and the exporter time and make the first few purchases easier until you get used to the process. 

Getting used to importing

It’s very easy to get along with some importers and harder with others. Getting used to working together sometimes will take time, but it’s okay. As long as you are committed to purchasing and willing to put in the work from your end, it will get easier, especially after the first 1-2 imports.

Advantages of importing/buying your JDM car through ZervTek Japan

This was written from a personal perspective, hoping to educate new entrepreneurs. We do everything that was stated in this article about how to import JDMs. That being said, if you are interested in working with us, please do not hesitate to contact us via Email or WhatsApp. Register on our auction site to browse vehicles.

Thank you for considering ZervTek Co., Ltd as your trusted partner in acquiring your dream JDM vehicle. Don't miss out on the chance to own a piece of Japanese automotive excellence without breaking the bank.