Limits to expansion: Transnational corporations and territorial embeddedness in the Japanese temporary staffing market

Recent changes to employment legislation have combined with shifting macro-economic conditions to drive dramatic growth in Japan's temporary staffing industry. Leading transnational staffing agencies have sought to capitalize on this growth as part of their wider globalization strategies but have faced substantial challenges both in entering the market and in their subsequent attempts at expansion. In this article, we explore the ways in which the particularities of the Japanese host market regulatory and institutional environment combine with the inherent characteristics of the temporary staffing business model to challenge the expansionary strategies of these firms. We argue that while transnational firms have sought to adapt their business practices and strategies to the Japanese case, the attributes of the Japanese staffing market mean they have been unable to make significant inroads into the dominant market shares held by their domestic rivals. © 2011 Blackwell Publishing Ltd & Global Networks Partnership.