Market Overview

The baby-related business market is estimated at 4,353.7 billion yen in 2024, which is a 1.2% increase from the previous year. This growth was supported by the robust preschool market, despite a shrinking demander population due to a decline in births.
By category, in addition to baby-related services (preschools), food, clothing, publications, and toys increased from the previous year, while childbirth and baby supplies decreased. The increases in food, clothing, publications, and toys were due to price adjustments. This price escalation offset the decrease in sales volume resulting from the shrinking demander population. 

Noteworthy Topics

Trend of Food Demand (Baby Formula and Food)

The baby formula market has maintained stable growth in 2024, because of an increasing number of dual-income households seeking to alleviate childrearing burdens, changing attitudes toward breastfeeding and formula use, and heightened awareness of the convenience of baby formula. The market has also been boosted by price revisions from each manufacturer, as well as increased opportunities to use baby formula, as more fathers are taking childcare leave.

The baby food market has been on an expanding trend for the past few years, because of increased demand for quicker and simpler methods of preparing weaning food, and waning guilt about using processed food for babies. However, the market downturned in 2024, as the effects from price revisions expired, a major manufacturer discontinued products (end of sales), consumers became hesitant to purchase due to rising commodity prices, and people minimized outings due to extreme heat.
Nevertheless, demand for baby food remains robust, as more mothers are expected to enter the workforce and more fathers are expected to take childcare leave, and manufacturers continue their product promotions. Still, some concerns remain, such as the possibility that rising material costs could reduce product variety. 

Future Outlook

The baby-related business market remains uncertain about its ability to grow considerably because of the significant impact of declining birth rates and child populations. While the market is expected to grow slightly, supported by infant services such as preschools, continued decreases in births could lead to a more severe market environment. Therefore, market players must strive to minimize the influence of shrinking domestic demand by obtaining demand from overseas and developing and launching value-added products.

The preschool market, which has been supporting the baby-related business market for the past few years, remains stable due to continued public funding to support child rearing and to combat diminishing births, despite slower market growth due to a slower pace of new establishment openings and fewer enrolled infants. However, the preschool market could also stall if preschool operators experience a further decrease in enrollment, a shakeout among preschools, or withdrawal from business.

Research Outline