TOKYO, Sept. 13, 2023—As pantry business failures spread across Japan, threatening school and workplace lunch services, spiraling food material and labor costs are bringing ramen restaurants to the knees, with the number of failures during the 2023 first eight months jumping 3.5 times to 28 compared with the same period a year ago, the corporate business research agency Tokyo Shoko Research reported Sept. 13.
Ramen businesses had been under the Covid-19 infection slack and 38 ramen restaurant chains went bust in 2020 – a far less casualties than feared – but the industry was later buoyed by generous government rescue subsidies, many making an impressive comeback, with the 2022 failure marking a record low of 21.
The 2023 ramen business environment is proving more dire and difficult to tide over: The industry’s benchmark costs that are meat, vegetables, spices and other materials are spiraling sky-high in line with the near historic weakening of the yen against other key currencies, energy, and labor.
A majority of ramen chains are operating with paid-up capital less than 10 million yen and workforce of less than a dozen.
Western Japan ramen business failures outnumbered those of eastern Japan including greater Tokyo, the impact seemingly reflecting another element: rapidly progressing population aging that seems to be developing faster in the west.
What’s the next industry to be hobbled? Many.
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