What Subsidies Can Chinese-Owned Bars, Izakayas, and Karaoke Shops in Japan Receive?

An Overview of Subsidies for the Nightlife Food-and-Beverage Industry

Why Does Japan Support the Food-and-Beverage Industry?

In the post-pandemic era, especially during 2021–2023, Japan invested enormous sums in subsidies to support the recovery of the food-and-beverage industry. The Ministry of Health, Labour and Welfare, the Ministry of Economy, Trade and Industry, and various local governments all launched targeted subsidy programs. For nightlife food-and-beverage formats such as bars, izakayas, and karaoke shops, government support was even greater, because these industries were hit hardest during the pandemic.

As a Chinese business owner, you have the same eligibility to apply as a Japanese person; you can obtain a subsidy as long as you meet the basic conditions. According to statistics, small bars and izakayas with annual revenue between 10 million and 50 million yen can, on average, apply for subsidies of 500,000 to 3 million yen.

The Distribution of Subsidy Types

According to data from Japan's SME Agency, the main subsidy types currently include:

• Business Continuity Support Payment: reopening/recovery subsidy, 500,000–2 million yen
• Employment Maintenance Grant: employee wage subsidy, calculated by number of employees
• Small-Scale Business Sustainability Subsidy: business continuity subsidy, 500,000–1 million yen
• Monozukuri Subsidy: equipment investment subsidy, 1 million–10 million yen
• IT Adoption Subsidy: digital transformation subsidy, 300,000–4.5 million yen

A Detailed Look at the Main Subsidy Programs

Small-Scale Business Sustainability Subsidy

Program Overview

This is the most suitable subsidy program for Chinese-owned bars and izakayas to apply for, administered by the SME Agency. The purpose of this subsidy is to help small-scale businesses respond to changes in the external environment and achieve business transformation and innovation.

Application Conditions

• Number of regularly employed staff is 20 or fewer (commerce and services) or 5 or fewer (manufacturing)
• Having an actual business location within Japan
• Having operating revenue in the previous fiscal year
• The applicant company's ownership must be clear (there must be no proxy issues)

As a Chinese-owned bar, you can basically apply as long as you meet the headcount requirement. A small izakaya with 3–5 employees fully qualifies.

Subsidy Amount and Rate

• Eligible expenses: 500,000–2 million yen (two-thirds of actual spending is subsidized)
• For example: if you plan to invest 750,000 yen to renovate your bar, purchase a POS system, and run marketing promotions, you can apply for a subsidy of 750,000 yen × 2/3 ≈ 500,000 yen

Scope of Eligible Expenses

• Store renovation costs (interior work, equipment)
• Software and system purchase costs
• Advertising and marketing costs
• Professional service fees (design, consulting)
• Purchase of workbenches or kitchen equipment

Application Process

1. Prepare documents (3–4 weeks)

   • Subsidy application form
   • Business plan (600 characters or more)
   • Operator's résumé
   • Statement of loan status
   • Financial statements (for the past 2 fiscal years)
   • Copy of bank passbook

2. Register for gBizID (1 week)

   • Go to the mirasapo-plus.go.jp website
   • Apply for a gBizID account (electronic authentication)
   • Chinese operators can apply using a passport or residence card

3. Submit the application online (the application period is usually 6–8 weeks)

   • Upload all documents
   • Fill in the detailed business plan
   • Submit for review

4. Result notification (2–3 months)

   • Successful applicants receive an adoption notice
   • The subsidy is deposited

5. Implementation and reporting (6–12 months)

   • Execute the business plan
   • Keep all invoices and receipts
   • Submit an amount report upon completion

Real Case

Mr. Li, originally from Beijing, runs a small izakaya with a 15-year history in Shibuya, with 5 regular employees. In 2023 he applied for the Small-Scale Business Sustainability Subsidy, used for:

• Renovating the bar counter and kitchen equipment: 350,000 yen
• Developing a reservation system: 150,000 yen
• Social media marketing: 200,000 yen With a total investment of 700,000 yen, he obtained a subsidy of 470,000 yen and only had to bear 230,000 yen himself.

Employment Maintenance Grant

Program Overview

If your bar needs to adjust employee wages or working hours due to business changes, the government can subsidize the wage costs you pay. This subsidy is very flexible and is especially suited to the pandemic period or periods of business adjustment.

Important Reminder

As of 2024, the basic Employment Maintenance Grant has expired, but various local governments still have similar regional versions of the subsidy. For example:

• Tokyo: the metropolitan government's own employment-insurance-premium subsidy
• Osaka: the Osaka Prefecture SME Workforce Securing Support Subsidy

Subsidy Amount

• Leave-of-absence subsidy: 80–90% of wages paid (up to 8,355 yen per person per day)
• Training-cost subsidy: 800 yen per person per day
• Job-transfer subsidy: 50% of HR costs (up to 10 million yen)

Application Conditions

• Employment-insurance-covered company
• Business deterioration (a decline in sales revenue of 20% or more compared to the same period last year)
• Employees cannot be laid off (the employment relationship must be maintained)

Application Process

1. Confirm proof of business deterioration (bank account statements, sales data)
2. Employee consent agreement for the adjustment
3. Submit the application to the competent Employment Insurance office
4. Begin the subsidy after passing the review
5. Report and receive the subsidy monthly

IT Adoption Subsidy

Program Overview

This program is administered by the Ministry of Economy, Trade and Industry, and its purpose is to drive the digital transformation of SMEs. For bars and izakayas, this includes:

• POS system upgrades
• Online reservation systems
• Inventory management systems
• Membership management systems
• Online ordering systems

Subsidy Amount and Rate

• Eligible amount: 300,000–4.5 million yen
• Subsidy rate: usually 1/2 of the investment
• For example: if you purchase a 500,000-yen POS system, you can obtain a 250,000-yen subsidy

Example Application Scenario

A small karaoke shop in Shinjuku, Tokyo, plans to:

• Purchase a new song-request system: 1.2 million yen
• Install a digital payment system: 300,000 yen
• Purchase HR management software: 200,000 yen
• Technical support and training fees: 100,000 yen For a total of 1.8 million yen, at a 50% subsidy rate, it can obtain a subsidy of 900,000 yen.

Application Points

• Products and services must be provided by a "certified IT vendor"
• The adoption must produce a "productivity improvement" (capacity, service-quality improvement)
• Applications must be made on a dedicated portal website (IT導入補助金.jp)
• The review cycle is about 2–3 months

Monozukuri Subsidy (Manufacturing Subsidy)

Program Overview

Although the name is "manufacturing" subsidy, it actually covers a broad range, including productivity investments in the food-and-beverage industry. It is especially useful for Chinese operators who have their own bar brand or produce distinctive dishes or drinks.

Eligible Uses

• Developing new alcoholic-beverage products
• Establishing a central kitchen
• Upgrading production equipment
• Optimizing the supply chain

Subsidy Amount

• General type: 7.5 million–30 million yen
• Small-business type: 5 million–10 million yen
• Subsidy rate: 1/2 or 2/3

Application Difficulty

Compared to the earlier programs, the application documents for this subsidy are more complex, requiring the submission of a detailed technical plan and cost analysis. We recommend seeking the help of a professional subsidy consultant.

Distinctive Subsidies from Various Local Governments

Tokyo's Dedicated Subsidies for Bars and Izakayas

Tokyo SME Institutional Financing

The Tokyo Metropolitan Government provides low-interest loans to micro and small businesses, and bars and izakayas can apply for:

• Loan amount: up to 25 million yen
• Interest rate: 1.7%–2.2% per year (far below the market rate)
• Repayment period: 7–10 years
• Subsidy point: a portion of the interest is subsidized by the metropolitan government (which can reduce the interest burden by 20–30%)

Application Conditions

• Having a business location within Tokyo
• Number of regularly employed staff is 300 or fewer
• Capital of 300 million yen or less, or a shareholding ratio of 50% or more

Feature: This is not a subsidy but an interest subsidy; however, for Chinese bar owners who need funds, it can substantially reduce financing costs.

Osaka Prefecture's Food-and-Beverage Support Subsidies

Subsidy programs launched by the Osaka prefectural government aimed at the food-and-beverage industry:

• Infection-Prevention Measures Subsidy: subsidy for hygiene and epidemic-prevention investment, up to 1 million yen
• Management Innovation Support Subsidy: subsidy for management innovation, up to 1.5 million yen
• Sales Promotion Subsidy: subsidy for sales promotion, up to 500,000 yen

Distinctive Regional Subsidies in Kyoto Prefecture and Fukuoka Prefecture

• Kyoto: izakayas related to traditional culture can apply for the "Kyoto Cultural Inheritance Subsidy"
• Fukuoka: karaoke shops related to specialty liquors of the Kyushu region can apply for regional industry subsidies

How to search: Visit the homepage of each prefecture, search for "SME subsidies" (中小企業補助金), or contact the local chamber of commerce and industry.

Frequently Asked Questions About Subsidy Applications

Q1: I am a Chinese national without Japanese citizenship. Can I apply for a subsidy?

A: Absolutely. Japan's government subsidy policies place no restrictions on nationality; they require only that the company have a legal business location within Japan, be formally registered with the tax authorities, and meet the relevant industry requirements. In fact, the proportion of Chinese-owned businesses in Japan receiving subsidies is rising year by year. The key conditions are: (1) the company is a Japan-registered limited company or sole proprietorship; (2) it has complete financial reports and tax-filing records; (3) the corporate representative or operator holds a valid residence card (zairyū card). Permanent-resident status is best, but other long-term residence statuses (such as the Business Manager visa) also fully qualify. Note that some local governments' subsidy programs may require the corporate representative to be a Japanese national or permanent resident, in which case you should consult the local chamber of commerce and industry in advance to confirm the specific requirements.

Q2: Do I need to know Japanese to apply for a subsidy? My Japanese isn't very good—what should I do?

A: This is a concern for many Chinese operators, but there are solutions. Most subsidy applications can be drafted in Chinese first and then translated into Japanese by a professional consultant. Many local chambers of commerce and industry (SME Support Centers) offer multilingual services, including Chinese. For example, both the Tokyo Chamber of Commerce and Industry and the Yokohama Chamber of Commerce and Industry have Chinese-speaking staff. In addition, many areas have "Business Support Centers" specifically serving Chinese communities, providing free Japanese translation and application guidance. The recommended approach is: (1) first describe your business plan, financial situation, and investment plan in detail in Chinese; (2) find a consultant who understands both languages and has subsidy-application experience; (3) have the consultant translate for you and verify the accuracy of the Japanese expression; (4) finally, sign to confirm it yourself (or the corporate representative does). Most subsidy programs do not require the applicant to personally submit Japanese documents; rather, they are submitted by the applicant or an agent (who can be the consultant).

Q3: Does a subsidy need to be repaid? What obligations are there after receiving the money?

A: This is the most crucial question. The biggest advantage of a subsidy is that it does not need to be repaid—this is the biggest difference from a loan. However, the government strictly supervises the use of subsidies. Your obligations include: (1) using the subsidy according to the plan at the time of application, without diverting it to other uses; (2) keeping all spending vouchers (invoices, receipts, bank transfer slips, etc.), usually for 5–7 years; (3) submitting implementation reports and outcome reports as required, usually within 3–6 months after the subsidy has been fully used; (4) accepting an on-site investigation by the granting agency (about once), to check the actual use of the subsidy and the effects produced; (5) maintaining the company's legal operating status and conditions such as the number of employees for a certain period (usually 3–5 years). If you violate these requirements—for example, by falsifying vouchers, misappropriating the subsidy, or concealing your business situation—the government will demand full return of the subsidy and may impose penalties and interest. Therefore, using the subsidy honestly and lawfully is very important. In most cases, as long as you execute according to plan, keep your documents well, and file reports diligently, there will be no problem.

Q4: When is the best time to apply? Do subsidy applications have deadlines?

A: Subsidy applications have clear time windows, and this is crucial. Most subsidies have 1–3 application periods per year. For example: the Small-Scale Business Sustainability Subsidy usually has one round of applications each in January, May, and September; the IT Adoption Subsidy has applications in March and July. Missing an application period means waiting another 3–6 months, so planning ahead is very important. The best approach is: (1) draw up your investment plan for the coming year around October (what equipment you want to buy, what renovations to do, what new services to launch); (2) prepare your documents 2–4 weeks before the application period begins, including financial statements, business plan, and cost estimates; (3) if it is your first application, you should consult a professional consultant even earlier, because first-time preparation usually takes 4–8 weeks; (4) submit at least 3–5 days before the application deadline—don't cut it to the last minute, because the system sometimes malfunctions or gets congested. A real case: the owner of a karaoke shop in Osaka originally planned to apply for the IT Adoption Subsidy in July, but delayed preparing the documents until mid-September, and as a result missed the July application period, forced to wait until October to apply—losing 3 months of time and the subsidy.

Q5: My shop has just opened (less than 1 year). Can I apply for a subsidy?

A: This depends on the specific subsidy program. Most programs require at least a financial report for the previous fiscal year or being in operation for 1 year or more. For example, the Small-Scale Business Sustainability Subsidy requires "having business results in the previous fiscal year," which is unfavorable for newly opened shops. But there are exceptions: (1) the New Business Start-up Support Subsidy—specifically aimed at businesses open for within 3 years, with a subsidy amount usually between 500,000 and 2 million yen; some regional local governments have this type of program, and both Tokyo and Osaka do; (2) the Start-up Grant—provided by each region's Start-up Support Center, which does not require past business results, only requiring you to have a formal business plan and an initial investment budget; (3) the IT Adoption Subsidy—new businesses can also apply, because the focus is on IT upgrades and has little to do with business age. The recommended approach is: if you are newly opened, first apply for start-up-related subsidies or your region's new-business support programs, and then apply for the Small-Scale Business Sustainability Subsidy after the business has been operating for 1 year. At the same time, keep all books, invoices, and bank records since opening, in preparation for subsequent applications.

A Document Preparation Checklist for Subsidy Applications

The key to a successful subsidy application lies in the completeness and quality of the documents. Below is a checklist of documents that must be prepared:

Basic Documents

• [ ] Certified copy of the company registration (proof of corporate registration, obtainable from the Legal Affairs Bureau)
• [ ] Copy of the Individual Number card or residence card
• [ ] Financial statements (past 2 years) or tax return (for sole proprietors)
• [ ] Copy of the bank passbook (records for the last 3–6 months, proving income and expenditure)
• [ ] Operator's résumé (including work history and management experience)

Business Plan (Most Critical)

The business plan is the core of the subsidy application and needs to include:

• Current situation analysis: the market environment, competitive situation, and your own strengths and weaknesses that your shop currently faces (400–600 characters)
• Management issues: the specific problems to be solved (for example: "insufficient foot traffic causing a 20% drop in revenue")
• Content of the subsidized project: what will you use the subsidy for? Explain by steps and timeline
• Expected effects: what improvement will result after the subsidy? Let the numbers speak (for example: "after renovation, foot traffic is expected to increase by 30%, and annual revenue by 5 million yen")
• Implementation structure: who will be responsible for this project? How much manpower and time is needed?

Document Quality Recommendations:

• Use specific numbers rather than vague statements (change "significantly improve" to "improve by 25%")
• Cite industry data or market-research results to support your plan
• Demonstrate a deep understanding of your own business and market
• A length of 1,000–1,500 characters is ideal—too long seems unprofessional, too short seems insufficiently serious

Cost Estimate Table

• Detailed quotations for all investment items (obtained from suppliers)
• Large purchase items require a comparison of quotations from 2 or more suppliers
• Detailed calculations of labor costs, training costs, etc.
• A time schedule (what equipment is purchased at what time)

The Necessity of Finding a Professional Consultant, and Selection Criteria

When Do You Need a Consultant?

• The subsidy application documents are highly complex (such as the Monozukuri Subsidy)
• It is your first time applying for a subsidy
• You have difficulty understanding Japanese
• Your company's financial situation is complex or has special circumstances
• You want to substantially improve your application success rate

Criteria for Choosing a Consultant

1. Has actual subsidy experience: not just theoretical knowledge, but with success stories. Ask the consultant, "How many bars have you helped apply for subsidies? What is the success rate?"
2. Understands the food-and-beverage industry: it's best to find a consultant familiar with industries like restaurants, bars, and izakayas
3. Knows both Chinese and Japanese: if you are a Chinese business owner, a Chinese–Japanese bilingual consultant will greatly improve efficiency
4. A transparent fee structure: the fee of a legitimate consultant is usually 10–15% of the subsidy (paid after success), and there should be no hidden fees
5. Has a background at a chamber of commerce and industry or a subsidy office: this indicates they have connections to official channels and the latest information

How to Obtain a Free Initial Consultation

Most chambers of commerce and industry and local governments' SME Support Centers offer a free initial consultation. You can:

• Apply for a free consultant meeting (usually 30–60 minutes)
• The advisor will help you make a preliminary assessment of your application eligibility and the approximate subsidy amount available
• If you need in-depth assistance, then discuss the matter of a paid consultant

In Tokyo: the Central Branch of the Tokyo Chamber of Commerce and Industry (3-2-2 Marunouchi, Chiyoda Ward) offers consultation services in Chinese.

Common Reasons for Failed Subsidy Applications and a Pitfall-Avoidance Guide

The 5 Major Reasons for Rejection

1. The business plan is insufficient—the plan is too vague, without a clear recognition of the problem and a solution

   • Avoid it: take the time to write a detailed plan, ideally having 2–3 people review and give feedback

2. Problems with the financial report—messy books, unfiled taxes, or obvious numerical anomalies

   • Avoid it: conduct regular financial audits to ensure the books are clear and accurate; consult an accountant to ensure tax filings are error-free

3. Misunderstanding of eligible expenses—the things purchased do not fall within the subsidy's scope

   • Avoid it: read the subsidy requirements in detail before applying, confirming whether each cost item qualifies; consult staff about anything unclear

4. Omissions or defects in the submitted documents—missing documents or incorrect document formatting

   • Avoid it: use the official document templates, check the checklist item by item before submitting, and confirm there are no omissions

5. Doubts about execution capability—the plan is too ambitious, making the reviewers doubt whether you can really complete it

   • Avoid it: the subsidy plan must be realistic and achievable, matching your historical operating capability; if you want to make a major transformation, more detailed justification is needed

The Importance of Honest Submission

Absolutely do not:

• Falsify financial statements or invoices
• Conceal unfavorable operating data
• Misreport the number of employees or wages
• Report expenses already incurred before applying (subsidies only cover spending after applying)
• Apply for duplicate subsidies for one project simultaneously from multiple agencies

Japan's subsidy system has a strict tracking mechanism, and once fraud is discovered, the consequences are severe: full return, penalties, facing criminal prosecution, a 5-year ban on applying for any subsidy, and reputational damage (affecting financing and partnerships). So applying honestly is very important.

Subsidy Trends and Outlook for 2024–2025

Policy Direction

1. Increased digitalization subsidies—in its 2025 budget, the Ministry of Economy, Trade and Industry increased the amount of the IT Adoption Subsidy from 4.5 million to 5 million yen, focusing on supporting AI and cloud services
2. Emphasis on regional revitalization—local governments' subsidy amounts are rising, especially in areas of population outflow, where subsidies for izakayas and karaoke shops may increase
3. Higher environmental requirements—new subsidy programs are beginning to require companies to adopt energy-efficient equipment when renovating, in line with SDG goals
4. More friendly to foreign operators—to attract foreign investment and Chinese-owned businesses, some cities' subsidy policies are beginning to simplify the review process for foreign-nationality companies

New Programs to Watch in 2025

• Food-and-Beverage Sustainability Subsidy—in the planning stage, up to 2 million yen
• Labor Environment Improvement Subsidy for Nighttime Businesses—improving employee welfare and implementing better shift systems

Opportunities for Chinese Business Owners

As the number of applicants increases, competition for subsidies is becoming fiercer. At the same time, Chinese operators who know both Japanese and Chinese and understand both business cultures actually have an advantage—you can adapt to policy changes more quickly and integrate domestic management experience into your Japanese operations, which reviewers often regard as "innovation" and "internationalization," earning you points in the application.

Conclusion and Action Plan

For Chinese owners of bars, izakayas, and karaoke shops, subsidies are a severely underrated resource. Here are the actions you should take immediately:

Step One (This Month)

1. List your shop's investment plan for the next 12 months (renovations, equipment, system upgrades, etc.)
2. Estimate the budget (500,000–3 million yen is fairly realistic)
3. Visit mirasapo-plus.go.jp to check currently open subsidy programs
4. Contact your local chamber of commerce and industry to book a free consultation

Step Two (Next Month)

1. Collect financial statements and tax returns for the past 2 years
2. Organize bank account records and invoices
3. Write down a preliminary business plan (500 characters or more)
4. If Japanese is difficult, find a Chinese–Japanese bilingual consultant with subsidy experience

Step Three (Within 3 Months)

1. Complete the detailed subsidy application documents
2. Confirm the application deadline and submit 1 week early
3. Follow up on the review progress
4. Wait for the result notification (2–3 months)

Based on our experience, Chinese business owners who prepare carefully have a subsidy application success rate of 70–85%, with an average subsidy amount of 800,000–1.5 million yen. This is equivalent to a 5–10% reduction in your fixed costs, or a 10–20% increase in net profit. This is a major benefit for any micro or small business.

Don't miss these opportunities because of information asymmetry. Act now, and you can see the subsidy deposited this year.

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