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HOW COFFEE IN JAPAN IS RESPONDING TO THE PANDEMIC

coffee in japan

Last Updated on March 14, 2021 by Nick Baskett

Introduction

If you don’t know it already, Japan is Asia’s biggest coffee market and the fifth-largest importer of coffee and coffee products globally. Walk down any street of Japan and you’ll come across at least one outlet to get a decent cup of coffee. 

I’ve travelled this island nation quite a bit these past few months, and every city I visit, I didn’t have to look very far to get my morning fix. In fact, I’d just walk down the street for less than a minute to the nearest vending machine for a canned coffee or convenience store for a piping hot cup of latte.

The global pandemic has disrupted countless industries in Japan, and without a doubt, the coffee industry took a hit as well. How are Japanese coffee businesses affected by COVID-19 and what are their responses to tackle this situation? 

Japan’s Coffee Habits Before COVID-19

Japan’s coffee market was worth USD$29.9 million in 2020. Before this new normal we’re currently experiencing, Japan’s coffee consumers were big on instant coffee — you’d see a whole row or two dedicated to instant coffee in local supermarkets, especially ones packed individually in sachets. It all ties in together with the country’s busy work culture and single-person households — not everyone in Japan has the time to brew a pot of coffee in the morning.

Even if they do, an espresso machine in a Japanese household is rarely heard of; the best you can get is a drip coffee maker on a Japanese kitchen top. 

Who would bother when you can walk out the door to the vending machine right outside your apartment building for a ¥100 (USD$1) canned coffee, or a short walk to the nearest convenience store for a ¥150 (USD1.50) hot latte. This accessibility and quickness is exactly what a fast-paced lifestyle of a typical Japanese salaryman needs. 

On the weekends, though, people would head out to some of the best-rated cafes in town for chit-chat over coffee with friends and family. 

It’s speedy fast or leisurely slow when it comes to Japan’s coffee habits. Regardless of the methods, one thing’s for sure: Japan loves its coffee.

COVID-19’s Impact on Japan’s Coffee Businesses

When COVID-19 forced major cities in the country into not one but two states of emergencies in the past year, there’s no doubt the negative impact it had on Japan’s coffee businesses. People were advised to stay at home and avoid visiting places like cafes, costing both international coffee chains and local third-wave coffee shops their regular customers. Some of these local cafes, especially the ones located in tourist areas like Shibuya and Roppongi, lost their main consumer market due to the border closure.

At the start of the state of emergency in March 2019, a lot of businesses were struggling and sales dropped to as low as 40% for some of them.

With the slump in customer numbers, hundreds of coffee businesses had to either close down or let go of their workers. Even the Kyoto-based coffee brand, % Arabica, which has gone global successfully, had to close down half of their 59 global stores due to the pandemic. 

How Japanese Coffee Businesses Responded

Despite it all, Japan’s coffee businesses were quick on their feet to combat this situation. The lockdown didn’t stop people from drinking coffee. Instead, it pushed people into taking an alternative route — from sitting in stores to taking their coffee drinking routine back home. A major coffee bean distributor in Japan reported recently that there has been an increase of more than 30% in sales for home products.

And since so many are staying at home, whether it’s to practice social responsibility or working remote, there has been a rise in instant coffee consumption — even more than before. For the past few years, Vietnam was second to Brazil when it came to coffee beans import. The high-quality roasted Arabica beans imported from Brazil has declined 40% while the Vietnamese Robusta coffee rose 26%, taking over the spot for the top coffee supplier in Japan. 

Coffee businesses in Japan, both specialty coffee shops and chains alike, saw this trend of home consumption and grabbed the opportunity to bring their offline store online — offering everything from coffee deliveries and roasted beans to equipment. Japan, in general, has been leaning more towards an offline community where the in-store experience is placed above the rest. Online shopping for anything was not preferred in comparison to heading to the shops and seeing it in front of your eyes. The pandemic gave the country a much-needed push towards the digital revolution.

One of Japan’s pioneering third-wave coffee shop, Streamer Coffee Company, which remained offline before COVID-19, opened its first online shop that sells beans and merchandise. Another leading coffee company in Japan, Blue Bottle Coffee Japan, has reshaped its cafe experience by hosting online seminars like cupping and drip classes. Blue Bottle’s local director, Ryo Itoh, said that this is a vision of the future where the online and offline connects in a “personalised, tailor-made experience.”

Other than online classes, some of Japan’s coffee businesses have looked at how other countries were boosting their sales through subscriptions. A Kyoto-based roastery and coffee speciality shop, Kurasu, has what they call the “Japanese Coffee Subscription”, where they bring two bags of different types of roasted beans to subscribed customers each month.

So far, they have partnered with Tokyo’s Onibus Coffee, Iwate Prefecture’s Nagasawa Coffee and Hyoto Prefecture’s Akekure Beans. The Japanese Coffee Subscription brings the nation’s specialty coffee to your doorstep, giving you the opportunity to expand your taste palettes.

Kurasu is not the only one that’s done this monthly coffee subscription — others have followed suit, including Slurp Coffee, White Coffee Company and PostCoffee — and some even offer customised selection.

Another innovative response to the situation is by Masatoshi Yamaguchi, owner of Coffee-sha Miyabi in Fukushima. He has converted a beverage vending machine to sell 8 varieties of coffee beans that he blended himself.

Due to the pandemic, Yamaguchi had to reduce the number of seats in his cafe from 10 to 4, resulting in plunging sales. This coffee beans vending machine gives him the opportunity to recover from the loss. This creative measure ticks a lot of boxes: tapping into Japan’s crazy vending machine culture, preventing the spread of coronavirus infections and allowing part of Yamaguchi’s business to run 24/7.

Even though eating and drinking out are advised to be kept at a minimum, coffee shops do stay open — local ones aren’t losing business, either. Because many people don’t want to travel far and prefer to avoid public transport, they resort to facilities in their neighbourhood. A lot of local coffee shops have had a rise in customers from their local neighbourhood, which has helped to replace the loss of their former customers. 

It seems that neighbourhood coffee shops are recovering much more quickly as compared to the ones that are located in tourist-centred or business-centred areas. The Ginza neighbourhood in Tokyo, for example, is a business district that’s struggling due to many people working remotely from home instead of commuting to the office.

A Future for Japanese Coffee

Forecasts are predicting more growth in Japan’s coffee market. Even though the coffee market in Japan was affected by COVID-19, from lost jobs to closure of businesses, the measures taken to adapt to this new normal has proven this innovative country’s capability to evolve and strategise efficiently. 

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