Japan Confectionery Industry Suffers Record-Breaking Bankruptcies

Confectionery stores in Japan are filing for bankruptcy at an unprecedented rate. According to Tokyo Shoko Research, 45 cases of bankruptcies were reported from January to July 2026, a figure that surpasses last year's total of 58 and sets a new record. This trend began accelerating in 2023, coinciding with the end of COVID-19 pandemic financial support measures and the start of full-scale repayments of interest-free loans.

The weak yen has driven up costs for key raw materials such as imported wheat, sugar, and dairy products, squeezing confectionery businesses' operations. Rising labor and utility costs are also contributing to the decline of small and micro businesses lacking financial resilience. Of the 45 bankruptcies, 15 directly cited soaring prices as a major factor.

Furthermore, consumers are adopting a more frugal mindset, leading to a decline in gift demand, which has historically been an important revenue source for confectionery shops. The industry's structure makes it difficult to pass higher costs on to consumers, who have come to expect sweets to be inexpensive. Intensifying competition from private-label products at convenience stores and supermarkets is also putting pressure on the industry.