Restaurants in Japan offer a wide array of dishes that cater to different budgets and tastes, resulting in a highly diverse culinary landscape. Next to dining places that offer typical Japanese dishes, such as sushi, soba, and udon, restaurants offering Western-style food, such as hamburgers and ethnic European cuisine, have firmly occupied a position in people’s dining out habits. The
, making it an important segment of the service industry in Japan.
Culture of dining out
Restaurants are widely used by people in Japan
for various reasons, especially in metropolitan areas, which provide an abundance of options for consumers. The rate and frequency of restaurant utilization varies across demographic layers. In general, figures show men eating out more often than women, while the visiting rate of restaurants tends to drop with increasing age. The
average annual expenditure for dining out for people in Japan is significant. The most common setting for eating out is with family members, as well as with friends and acquaintances, showing that dining out is typically used as an opportunity for social interaction. Japanese-style shops, such as sushi and ramen restaurants, are among the most chosen types of restaurants when dining out.
Fierce competition
Japan has an enormous number of restaurants,
run by tens of thousands of businesses. The high demand in Japanese society for restaurant food offers great possibilities for businesses, but it is also a reason for the high competitiveness of the restaurant industry. This is a defining characteristic, shaping the restaurant industry's landscape. It shows, for example in the often tight profit margins of companies (especially smaller ones), and unfavorable working conditions for employees. Another defining feature is the market's consumer-centric stance. Opening hours of shops in metropolitan areas are typically long, and many chain restaurants that offer casual dining are open around the clock. The high competition might also be the reason for price worthy dining experiences for consumers at the lower spectrum of the price range, and
low wages earned by employees, most of whom work in part-time or temporary positions. Another characteristic of the industry is that a good deal of its market share is owned by a handful of companies. A possible consequence is that new industry players and small businesses face an uphill battle in terms of survivability. The market is mainly dominated by domestic companies, with Zensho Holdings generating the highest amount of annual revenue.
Saturated market
The central position of the restaurant industry in Japanese society has created fierce competition that led to a saturated market. This market environment operates on tight profit margins and is geared for efficiency. While the environment can be favorable for large industry players, such as
McDonald’s Japan, which may be able to leverage their influence to make a profit, it is often adverse for smaller companies. The market is highly consumer-centric and service-oriented, which provides convenience to consumers but puts a strain on employees.
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