Cleaning and Laundry Services Market in Japan: Key Research Findings 2021
Domestic Cleaning and Laundry Services Market Attained 282,500 Million Yen for 2020, 81.3% YoY
Yano Research Institute (the President, Takashi Mizukoshi) has carried out a survey on the domestic cleaning and laundry services market, and has found out the market size and the trends by sales channel.
Summary of Research Findings
Domestic cleaning and laundry services market (as a total of retail laundry and dry cleaning services for general households, laundromats, and non-store services dedicated to home pick-up and drop-off) for 2020 has declined to 81.3% of the previous year to attain 282,500 million yen, based on the sales at businesses. Despite the signs of recovery in 2019, the market stumbled again in 2020 due to COVID-19 calamity. Viewing by sales channel, the outlets of “retail laundry and dry cleaning service” experienced a serious downturn, dropping to 172,350 million yen, which is only 72% of the preceding year. On the other hand, though sluggish compared to previous years, both “laundromats” and “non-store services dedicated to home pick-up and drop-off” managed to sustain moderate growth, yielding 100,100 million yen (102.1% YoY) and 10,050 million yen (100.5% YoY), respectively.
All in all, 2020 was a tough year for the cleaning and laundry services industry, because the pandemic increased remote working and decreased sales of apparel products, especially dress shirts and business suits. Even though the sales of “non-store/delivery” channel was driven by the rapid expansion of online on-demand laundry services, COVID-19 crisis put brakes on the overall market growth in 2020. Despite the high utilization rate and strong sales in the previous years achieved by the development of new type of facilities like large-scale facility in the suburbs and laundromats with a café or a convenience store, prolonged COVID-19 pandemic slackened growth of the laundromat market. Nevertheless, the channel that was most impacted by the pandemic is the traditional “retail laundry and dry cleaning services”; the market has been diminishing for the last couple of years.
Trends of Laundromat Market
In contrast to other markets, the laundromat market was not affected so much by the pandemic, because it was not a segment under restriction during the state of emergency in 2020. Due to the demand steered by unstable weather, prolonged rainy season in particular, and the lift of the first state of emergency, many facilities enjoyed a rise in utilization rate from June. However, because sales declined temporarily between April-May by 10 to 20 percent from to the same months of the previous year, and because the corona shock continued for a long time, industry growth slowed down. Size of the laundromat market for 2020 was valued at 100,100 million yen, 102.1% of the preceding year.
In spite of the fact that there are businesses that continue to grow at a healthy pace and open more facilities, 2021 saw an increase in the number of flagging laundromat business operators, whose business growth downturned and sales declined at existing facilities compared to the previous year. Considering the situation, it is highly probable that the market makes a further downturn hereafter. The market is forecasted to transition from 101,100 million yen for 2021 (101.0% YoY) to 101,600 million yen for 2022 (100.5% YoY).
Competition in the laundromat market today, which has been intensified by the market entry by companies in other industries, gave rise to development of a variety of facilities, for instance, a laundromat with a café, a laundromat with a convenience store, a laundromat with manned service outlet of laundry agency, and a stylish laundromat facility that have a look and feel of a hairdresser. As seen in the introduction of smart laundry system that provides user-friendly solution by integrating IoT technologies with smartphones, the laundromat business operators have started to compete in a presentation of new customer benefit. In any case, an increasing number of market payers have made the market competition fiercer. Competitive landscape will be determined hereafter.
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