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"I want to use the Monozukuri Subsidy."
"I want to know the application flow for the Monozukuri Subsidy."
This article is for those thinking this way. It explains in detail the overview of the Monozukuri Subsidy, the application process, eligibility, maximum subsidy amount, and subsidy rate.
In the latter part of the article, we also introduce key points for getting accepted and examples of system development projects that used the Monozukuri Subsidy.
If you're interested in the Monozukuri Subsidy, be sure to read on.
Akira Shimazoe
CEO of Solashi Japan LLC. Engaged in the development and operation of internal systems at Suntory. Founded Yper Inc., serving as CTO and CPO, contributing to product launch and growth.
What is the Monozukuri Subsidy?
The Monozukuri Subsidy is short for the “Subsidy for Promoting Productivity Improvement in Manufacturing, Commerce, and Services.” (Hereafter, referred to as the “Monozukuri Subsidy” in this article.)
The Monozukuri Subsidy is a system established by the Small and Medium Enterprise Agency and the Organization for Small & Medium Enterprises and Regional Innovation, Japan, aimed at supporting small and medium-sized enterprises.
It supports investments in necessary equipment and systems with the following main objectives:
- Improving and advancing innovative production processes and service delivery methods through the use of IT, etc., to resolve labor shortages
- Promoting the development of innovative products and services in fields such as DX and GX
- Improving domestic productivity through overseas business development
The specific expenses eligible for subsidies are as follows:
- Machinery and system construction costs
- Technology introduction costs
- Expert fees
- Transportation costs
- Cloud service usage fees
- Raw material costs
- Outsourcing costs
- Intellectual property-related costs
- Overseas travel expenses※
- Interpretation and translation costs※
- Advertising and sales promotion expenses※
(※Only applicable to the Global Track)
Here, we will explain the Monozukuri Subsidy in detail, including eligible applicants, subsidy limits and rates, and the schedule from 2024 onward.
Eligible Applicants
The Monozukuri Subsidy is available to businesses in a wide range of industries, including service, retail, construction, and travel industries.
However, each industry has specific limits on capital and the number of full-time employees. For detailed figures, please refer to the official website of the Monozukuri Subsidy.
Accepted cases include businesses from various sectors, such as service, retail, and agriculture. As long as the conditions are met, even sole proprietors can apply.
Subsidy Limits and Rates
The image above shows the subsidy limits and rates by application type and category.
There are three types of application tracks: “Labor-Saving (Customized) Track,” “High Value-Added Product/Service Track,” and “Global Track,” each with different subsidy limits and rates.
Also, special provisions apply to businesses that implement significant wage increases within 3 to 5 years after the subsidy project ends.
Under the “Special Provision for Increased Subsidy Limits Due to Significant Wage Increases,” an additional amount of 1 million to 20 million yen may be granted.
Schedule from 2024 Onward
Since the call for applications began in 2020, the Monozukuri Subsidy has been accepting applications throughout the year. For example, let’s take a look at the schedule for the 18th call.
(Source: Overview of the 18th Call for Applications | Manufacturing Subsidy Office)
In the 18th call for applications, the application guidelines were published at the end of January, and the application acceptance period is from mid-March to the end of March.
After the applicant review is conducted, candidates for the subsidy grant will be announced around late June. The implementation period for the subsidized project begins, and after actual execution of the project, a performance report must be submitted. The deadline is December 10.
After that, a final inspection is conducted and the subsidy can be claimed. As such, it takes more than a year from application to payment of the manufacturing subsidy.
As of February 2024, the schedule has only been announced up to the 18th call, but it may be updated as needed in the future.
If you're considering applying for the manufacturing subsidy, be sure to check the official information.
Important Points When Applying for the Manufacturing Subsidy
Here are four important points to note when applying for the manufacturing subsidy:
- There's a possibility of not being selected
- You must submit reports during the project implementation period
- The application process requires time and effort
- As it's post-paid, you need cash flow countermeasures
Let’s go through each of them so you can evaluate them against your own business.
There’s a possibility of not being selected
One key point to note is that there's a possibility of not being selected.
According to official data from the "Manufacturing Subsidy Program Homepage", the acceptance rate for the 16th call, which had 5,606 applicants, was 48.8%.
This means that more than 2,800 businesses—more than half—were not accepted despite applying.
Just because you apply for the manufacturing subsidy doesn't guarantee acceptance. Relying on the subsidy as a foundation for your asset planning is risky and should be avoided.
You must submit reports during the project implementation period
It’s also important to be aware that you are required to submit reports during the project implementation period.
During the project period, you must complete all procedures—ordering, delivery, inspection, and payment—and submit a performance report.
Extensions to the original period are generally not allowed, so strict schedule management is essential.
The application process requires time and effort
(Source: Data Portal | Manufacturing Subsidy Official Website)
When you hear "subsidy", some people may think “Let’s just apply for now.” However, be aware that the application process requires preparation and effort.
According to official information, among the 13th to 16th rounds of applications, the most common amount of time spent creating the business plan was "20 to 30 hours." Many companies spent over 120 hours on it.
Among the application steps, document preparation in particular requires time and effort, so assess whether applying is worth it based on this understanding.
As it's post-paid, you need cash flow countermeasures
Because subsidies are paid afterward, it’s essential to plan for cash flow.
As mentioned in the schedule earlier, you will receive the subsidy only after the implementation period, submission of reports, and final inspection. Therefore, you will need to cover expenses with your own company’s funds initially.
If your budget is tight, you may need to consider countermeasures such as securing financing from a bank or other financial institution.
Application Procedure for the Monozukuri Subsidy
This section explains the actual application procedure for those considering applying for the Monozukuri Subsidy.
- Register a G Biz ID Prime account
- Prepare the necessary documents
- Enter the required information
- Submit data and apply
Each step will be explained in detail. The flow is summarized in an easy-to-understand way, so please use it as a reference.
Register a G Biz ID Prime Account
As of February 2024, the Monozukuri Subsidy application is only available via electronic submission.
To use the application system, you will need a "G Biz ID Prime Account", so please make sure to obtain it in advance.
"G Biz ID" is a unified authentication system for corporations and sole proprietors. By obtaining this ID, you can log in to various government services.
You can register for a "G Biz ID Prime Account" from the official website below.
Click here to obtain a G Biz ID Prime Account
Prepare the Necessary Documents
Next, prepare the necessary documents.
The required documents are listed below. Please note that the submission requirements may be updated, so be sure to check the official information for the latest details.
Required Documents
- Business plan
- Basis for business plan calculations
- Financial statements, etc.
- Documents confirming number of employees
- Employee roster
- Business restructuring company※
- Confirmation regarding minimum wage requirements※
- Plan for significant wage increase※
- Confirmation letter from financial institution※
- Evidence related to additional points※
（※Only applicable for some applicants）
In addition to publicly available documents that the business operator should already possess, some documents will need to be newly created for the Monozukuri Subsidy application.
During electronic application, files must be submitted in PDF format as attachments.
Among the entire application flow, preparing these documents is the most time-consuming and labor-intensive step. If you decide to apply, we recommend allocating sufficient time in your schedule for preparation.
Enter the Required Information
Once your documents are ready, log in with your G Biz ID Prime account to proceed with the application. Please review the application guidelines again and enter all required information accordingly.
Below is the list of information you will need to input:
Information Required for Input
- Business operator information
- Detailed expense breakdown
- Business plan name and summary of business plan
- Pledge regarding subsidized expenses
- Pledge for wage increase plan
- Confirmation regarding minimum wage requirements※
（※Only for some applicable applicants. Can also be submitted as PDF documents）
If you're unsure how to use the system, phone support is also available.
For electronic applications and phone support related to the Monozukuri Subsidy, click here.
Data Submission & Application
After entering all the required information, make sure to carefully review your application and send the data. Be sure to check that there are no errors or missing details in your application documents or entry items.
4 Key Points to Get Approved for the Monozukuri Subsidy
Here are 4 key points to help increase your chances of getting approved for the Monozukuri Subsidy.
- Properly include all required review criteria
- Understand the point-increase and point-decrease items
- Clearly present the business impact
- Consider hiring a professional for documentation
Each point will be explained in detail, so feel free to use this as a reference.
The selection rate for the Monozukuri Subsidy is estimated to be just under 50%. Understand these points to improve your chances of getting approved.
Properly Include All Required Review Criteria
The Monozukuri Subsidy is a system available only to businesses that meet the specified "requirements".
Therefore, it’s crucial to fully understand the evaluation criteria and properly reflect them in the submitted documents.
For instance, one of the goals of the Monozukuri Subsidy is to support “business innovation.” But this doesn’t necessarily mean world-changing inventions or revolutionary ideas are required.
Developing products or services that are not yet widespread among SMEs in the same industry and that offer new value to customers may still qualify for support.
First, thoroughly read the application guidelines to understand the required elements and the level expected. Looking up specific examples of past approved cases may also help.
Understand the Point-Increase and Point-Decrease Items
In the Monozukuri Subsidy system, both "point-increase" and "point-decrease" items are defined. To improve your chances of approval, it’s ideal to respond to as many applicable point-increase items as possible.
It’s also important to be aware of point-decrease items just in case. Below are the details of these two categories.
About Point-Increase Items
The main categories for point-increase items are as follows:
Point-Increase Items
- Growth potential points
- Policy alignment points
- Disaster-related points
- Wage raise-related points
- Promotion of gender equality and diversity points
Each of these is further divided into specific sub-categories. In the 18th round of applications, up to 6 point-increase categories can be submitted.
To give yourself an advantage, make sure to understand and prepare for these point-increase items before applying.
About Point-Decrease Items
On the other hand, point-decrease items are as follows:
Point-Decrease Items
- Receiving similar subsidies once within the last 3 years from the application deadline
- Receiving subsidies from the FY2019 Monozukuri program or later and not having fulfilled the profit return obligation
If a business has received similar subsidies twice or more in the past 3 years, it becomes ineligible to apply.
Clearly Present the Business Impact
Clearly presenting the impact of your business is also a key point. Aim to create convincing materials by using objective figures, graphs, or visualizations to support your claims.
For example, in the case of system development, you can show the effectiveness by comparing the data before and after implementation.
Also, be sure to include specific reasons why the expected business results are likely. It’s effective to use statistical data, analyze real user feedback, or conduct your own customer surveys.
Consider Hiring a Professional for Documentation
Documentation, which tends to be the most burdensome part, can be outsourced to professionals with relevant knowledge.
Keep in mind that being selected for the Monozukuri Subsidy is not guaranteed. If you're overwhelmed with document preparation and can’t focus on your core business, it defeats the purpose.
If your team finds it difficult to handle internally, we recommend consulting with a specialist or firm. There are no specific qualifications required to support applications, so choose based on track records and reviews.
At our company Solashi Co., Ltd, we can introduce you to various companies that offer application support. Feel free to contact us.
Examples of available experts:
- Small and Medium Enterprise Management Consultants
- Tax Accountants
- Administrative Scriveners
- Certified Public Accountants
Note: If you receive support for creating your business plan, you must declare it. Be sure to fill in the "Support Provider for Business Plan" and "Support Fee" fields in the application system.
Case Studies of System Development Using the Monozukuri Subsidy
Here are some examples of system development projects that utilized the Monozukuri Subsidy.
- Matching app and system development for staffing services
- Multilingual remote interpretation service development for consumers
- System development for advance payment of outsourcing fees
- One-stop cloud-based HR system development and sales
Matching App & System Development for Staffing Services
This is a case of developing a matching app and system for staffing services.
This was an actual project handled by our offshore development company in Vietnam, Solashi Co., Ltd.
We were involved in developing a matching system and app for short-term staffing on a daily basis. Previously, the client had no in-house engineers and had been handling staffing operations manually.
We commissioned a development company to systematize our operations, but product-related troubles arose. Despite our IT investment, a non-functional system was completed.
As a result, we were approached for assistance, and we decided to rebuild the system from the ground up. As part of our efforts to improve the development environment and workflow, we applied for the Monodzukuri Subsidy.
Our company also partially handled the application process on behalf of the client, working together with partner companies. The client took responsibility for the content of the application, which allowed the project to move forward.
As a result of the application being accepted, we were able to proceed with development based on a sufficient budget and successfully release the app.
[Overview]
| Prefecture | Tokyo |
| Project Plan | Development of an app that allows people to work from just one day using language skills |
| Industry | Human resources, events, marketing |
| Fiscal Year | 2023–2024 |
Development of a Consumer-Oriented Multilingual Remote Interpretation Service
This is a case study on the development of a consumer-oriented multilingual remote interpretation service.
We developed a new consumer service based on a remote interpretation service that had previously been provided for corporate clients.
To make the service suitable for individual users, we enhanced convenience by digitizing and automating processes, revising payment methods, and implementing multilingual support in the system.
This initiative is gaining attention as a model for improving the environment to accommodate foreign tourists visiting Japan.
[Overview]
| Prefecture | Tokyo |
| Project Plan | Development of a consumer-oriented “Multilingual Remote Interpretation Service” |
| Industry | Other business service industries |
| Fiscal Year | 2016 |
System Development for Advance Payment of Contractor Fees
This is a case study on the system development for an advance payment service for contractor fees. We developed a service to provide advance payment to self-employed delivery drivers.
In the light cargo transport industry, the contract structure often results in payment terms stretching up to 60 days. This cash flow difficulty hindered driver retention and new entry into the market.
The advance payment system is expected to help address the issue of driver shortages.
[Overview]
| Prefecture | Kanagawa |
| Project Plan | System development for advance payment of contractor fees |
| Industry | Internet-related services |
| Fiscal Year | 2018 |
Development and Sales of an All-in-One Cloud-Based HR System
In response to the widespread lack of proper HR system operation in small and medium-sized enterprises, we developed an all-in-one cloud-based HR system.
The system includes functionality for formulating, managing, and operating grading and compensation systems, as well as the ability to save system templates, differentiating it from existing solutions on the market.
This HR system enables appropriate and efficient HR operations, contributes to employee motivation and skills improvement, and is expected to help boost company performance.
[Overview]
| Prefecture | Shizuoka |
| Project Plan | Development and sales of an easy-to-use, all-in-one cloud-based HR system |
| Industry | Professional services (not otherwise classified) |
| Fiscal Year | 2019 |
Consult Solashi for Your System Development Needs
This article focused on the Monodzukuri Subsidy program.
Although applying for the Monodzukuri Subsidy requires significant effort and time, it is a program well worth leveraging if there is a chance of acceptance. Be sure to understand the requirements in advance and prepare early.
At the Vietnamese offshore development company Solashi Co., Ltd, we have participated in actual projects that were selected for the Monodzukuri Subsidy.
We offer comprehensive support for everything from strategy planning for system development to maintenance and operations, leveraging the Monodzukuri Subsidy.
Our team includes several Japanese project managers with experience in launching new businesses and handling startup projects. We also have members well-versed in IT project management and system development technologies.
Whether you're considering launching a new business or looking to switch from your current outsourcing partner, we are here to help.
If you’re seeking a partner company for system development, please feel free to contact Solashi Co., Ltd.
Akira Shimazoe
Representative of Solashi Japan LLC. Born in April 1989 in Fukuoka Prefecture. Graduated from the Graduate School of Information and Mathematical Sciences at Osaka Prefecture University. Joined Suntory System Technology Co., Ltd., an IT subsidiary of Suntory Holdings, in 2014. Broadly responsible for the development, operation, and implementation of vending machine delivery management, efficiency improvements, and sales management systems. Founded Yper Inc. in 2017, serving as CTO and CPO. Contributed to the launch and growth of the app-linked delivery bag "OKIPPA." Selected for Toyo Keizai's prestigious "Amazing Venture 100" and Forbes' "Forbes 30 Under 30 Asia 2019."
