If you were to isolate one area where a shift in consumption and purchase could easily give you a killer indication as to how good or bad things are, the beverage industry in Japan in my opinion would be it. Everywhere (and I mean EVERYWHERE) you go in Japan you will find beverage vending machines. When I lived there nearly 20 years ago in a home, surrounded by rice paddies, in a very rural town on the Eastern side of the main island of Japan (HON-SHU) I could walk just 50 yards out in front of my home and purchase coffee, sodas, and even beers from two roadside vending machines! And even my own daily morning routine, like so many Japanese "salarymen" and "office ladies", was to plunk in 120 yen for a cold or hot (depending on the time of the year) coffee on my way to school.
Another typical social behavior connected strongly to beverages in Japan is that most Japanese do not entertain - for business or pleasure - in their home, and instead head straight to coffee shops, or - after work - Izakayas (Japanese pubs) to connect and socialize with one another.
So why did the recent economic report on the decline in beverage sales in Japan have me so worried? Well, it's simple: Less beer and less canned coffee sold from vending machines means that the same "belt tightening" that led to layoffs and pay cuts in the US is now in full swing in Japan as well. Companies use the afterhour bar scenes regularily to continue the business of the day, and the exchange of Kirin, Suntory, Sapporo and other beers with one another are almost ceremonial. If I'm right, and this isn't happening as frequently as before and the sales of beer are way down, it means that discretionary budgets are being cut or eliminated within companies... this alone will dramatically change the way business is done. The decline over last year and just January alone (typically a huge celebratory month in Japan) in beverage sales is staggering. More belt tightening through passing by the vending machines in favor of the pot of tea at work also signals a continued economic decline.
It's been almost 13 years since I've been back to Japan (Despite my long absence, I consider it my second home.) I am really looking forward to not only see what major developments have occured in the world of retail, but observing how the Japanese consumer is changing and how business as usual is being redefined. And, slow down aside, I have no doubt I'll be able to find my favorite canned coffee in vending machines all over.... and if anyone wants to help the Japanese beverage industry by buying me a beer, I'll happily accept.
