In 2024, hot drinks in Japan is set to experience growth in retail current value terms, but a decline in retail volume terms, primarily due to rising unit prices. Major coffee manufacturers had already increased prices in 2021, 2022, and 2023.
The more prolonged summers resulting from climate change have posed challenges for hot drinks in Japan. However, many manufacturers are seizing this opportunity to focus on iced beverages.
In 2024, Nestlé Japan Ltd is expected to maintain its lead in hot drinks in retail value terms, primarily due to its strong brand Nescafé Gold, which also commands the largest value share in overall hot drinks. In 2023, the company unveiled its new brand concept, “Make your World”, aimed at ensuring consumers can enjoy delicious coffee in a sustainable way through purchasing its global Nescafé coffee brand.
During the pandemic, supermarkets experienced a surge in demand in hot drinks in Japan, as they became the go-to solution for convenient one-stop shopping. As the pandemic subsided, this heightened demand has diminished; however, supermarkets is still poised to remain the largest distribution channel for hot drinks in Japan in value terms in 2024.
In 2024, volume sales of hot drinks in the foodservice channel are expected to record growth thanks to the gradual recovery of footfall at cafés and specialist coffee and tea shops. However, foodservice volume sales in this year are not expected to return to the same level as in 2019 (pre-pandemic), as more people are working from home compared with pre-pandemic, and the demand for business meetings or trips to foodservice outlets has continued to be lower.
Retail volume sales of hot drinks in Japan are projected to experience a steady decline over the forecast period, primarily due to the ongoing decrease in the birth rate and, consequently, the population. Japan’s birth rate has been on a downward trajectory for decades, and the pandemic further exacerbated this trend, as many women opted not to conceive due to concerns over infection and economic uncertainty.
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Hot Drinks
This report originates from Passport, our Hot Drinks research and analysis database.
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