Japan food & beverage sector: business opportunities for foreign companies

Japan food & beverage sector: business opportunities for foreign companies

Business possibilities in the food & drink sector in Japan

The food and drink sector is a stable yet massive industry in Japan. Revenue in this segment amounts to US$15 billion in 2018, with an annual growth of around 8%.

 

Consumption Profile of the Japanese

Japan might have experienced stagnation especially when the crisis hit the country but compared to other countries in Asia, Japan still has high food consumption. In 2013, the country consumed about 107 million tons of food and other grocery items. Based on the data from MAFF, Food Balance, the following comprise the consumption percentage share of the Japanese:

  •        Food Grain (32%)
  •        Vegetables (14%)
  •        Dairy Products (11%)
  •        Seafood (7%)
  •        Fruits (7%)
  •        Meat (5%)
  •        Others (24%)

Based on the following figures, the Japanese spend most on food grains which account for 32% followed by other food products. The Japanese are known to enjoy a wide variety of food products from traditional food items to imported products from other countries. In addition, consumers also spend on vegetables, dairy products like milk, egg, etc., seafood, fruits and meat.

Food grains account for the highest share in total food consumption while meat and seafood are at relatively the same percentage. 47% of Japanese consumers shop for their grocery requirements at supermarkets while 32% of customers prefer GMS and 7% go to CVS. Smaller supermarkets account for 5% of the total consumption market share in the country.

Second-Biggest Market in Asia

In Asia, Japan holds the second highest food consumption percentage at 23% next to China which has 38% market share. Korea has 4% while the rest of the countries contribute about 32%. This demand is expected to continue to grow.

This is a good business opportunity for those who are in the food and drink sector especially since Japan heavily relies on imports for their food. The country’s self-sufficiency rate has declined to 39% across food groups making the industry a viable and profitable business opportunity for those who want to introduce new food products in the market. They are willing to adapt their products to Japanese market needs.

The consumer profile has changed a lot, as the Japanese have adopted Western habits when it comes to food choice and consumption.

A majority have begun to consume more milk, wheat, meat and other dairy products. As an increasing number of Japanese consumers allocate a higher budget percentage for food, various opportunities await investors and international brands to enter the market to introduce new food preferences for local consumption.

This entry in Asia was updated on June 5, 2018 by specialist.