What Japan’s New Business Expansion and Monozukuri Subsidy Asks of Your Business Plan: A View from the Front Lines of New Ventures

In 2026, Japan launched a new subsidy to support small and medium-sized enterprises in starting new businesses: the Shinjigyo Shinshutsu / Monozukuri Shogyo Service Hojokin (New Business Expansion and Manufacturing, Commerce and Service Subsidy). The deadline for the first round of applications is 6:00 p.m. on Friday, October 30, 2026 (Japan time). Selection is decided through a comprehensive assessment of the submitted business plan from perspectives such as eligibility as a subsidized project, consistency with the company’s management strategy, feasibility, the need for public support, and policy considerations (according to the FAQ on the official website, in Japanese). This article summarizes the key points of the official materials and, from the perspective of people who launch new businesses on the ground, the points your business plan should address.

1. Overview of the subsidy

The subsidy is open to SMEs and similar organizations, and offers three categories depending on the purpose.

The maximum subsidy depends on the number of employees; the amounts above are for the largest category (for example, in the New Business Expansion category, the base maximum for companies with 20 or fewer employees is ¥25 million). The minimum subsidy is ¥1 million for the Innovative New Products and Services category and ¥7.5 million for the New Business Expansion and Global categories. Before applying, be sure to check the latest application guidelines on the official website (in Japanese). Information is current as of October 12, 2026.

2. Explain what is “new” in line with the program’s definitions

In the New Business Expansion category, the starting point is that the new product or service and its market must be new to your company. In addition, the program’s supplementary materials require that the business meet one of the following:

• New market: the genre or field of the product or service has a low level of general adoption or awareness in society.
• High added value: within the same genre or field, the business aims to achieve a high level of added value or a high price level compared with the general added value or market price.

Note that when defining the genre or field, you may not include factors such as performance, size, materials, price range, regional characteristics, business format, customer segment or effects. For example, labeling something as “premium” or “for ○○” to make it look new does not count as evidence of a new market. Meeting one of these criteria also does not guarantee selection. Why do your company’s strengths create that novelty or added value? Being able to explain that reasoning is the foundation of your plan.

3. Show who will buy, using real voices rather than assumptions

One common stumbling block in new businesses is investing in equipment or a store on the assumption that the product “should sell.” Before writing the plan, talk to your prospective customers and find out what price they would pay and what they currently use instead. Those records become strong evidence of demand.

4. Plan for operations after launch

A business does not run just because the equipment has been installed. Who will sell? How will people find out about it? How many months until it breaks even? It is important to be able to describe these three elements — team, customer acquisition and profitability — with figures and the names of the people responsible.

5. Lessons from launching a new brand

For FONDANT, a specialty shop for premium cream croquettes that LEONIA supported, we started with the question “Why this flavor, and why now?” and designed everything — the concept, logo, fixtures and uniforms — around a single, consistent idea. After opening, the shop was featured on a nationally broadcast TV program. (This project was not selected under this subsidy.) We believe that being able to say in a few words why it has to be this particular business is the foundation both for explaining your plan and for being chosen by customers.

6. Even at the idea stage

A new business plan takes shape faster when you talk it through with a third party than when you work on it alone. LEONIA supports you from developing the substance of your business plan to running the business after launch. Feel free to contact us, even if you have not yet clearly defined your challenges.

This article provides an overview of the program and does not guarantee that you will meet the application requirements or be selected. For final decisions, please check the application guidelines and contact the program secretariat.

Sources (in Japanese): Official website of the subsidy / Supplementary material: “What Is a New-Market / High-Value-Added Business?” (Small and Medium Enterprise Agency and SMRJ, June 2026) / Official FAQ / Small and Medium Enterprise Agency: Publication of the first-round application guidelines