Market Overview

The domestic shoes and footwear retail market for FY2022 is estimated at 1,120.4 billion yen by retail price, 102.6% of that of the preceding fiscal year. The growth attributes to the stable sales of sports shoes, propelled by the student demand, which has increased as school events and club activities postponed or downsized during the pandemic have been resumed, as well as by increased spending by general consumers who started to go out again more often. Additionally, men’s shoes and women’s shoes, especially functional footwear that are waterproof, comforting (with cushioning), and breathable, sold well.

Marked decline of the domestic shoes and footwear retail market had been witnessed since FY2016, in association with the trend toward casual business attire, which led consumers to “turn away” from leather shoes and pumps. A rise to the demand for sneakers dropped average sale per customer. Despite the further considerable decline during the COVID crisis, the market size is gradually edging upwards.

 

Noteworthy Topics

Spread of Challenges for Circularity

In line with the growing awareness of sustainability worldwide, domestic manufacturers of shoes and footwear are embarking on developing materials that reduce CO2 emissions and environmental impact, improving product traceability, and promoting recycling. For instance, sneakers made out of plastic bottles are developed, and charms and novelties from leather scraps have been created. Challenges for circular economy in shoes and footwear industry is spreading beyond just selling products made out of sustainable materials, but to donating trade-in shoes to developing countries, reinforcing resale business, optimizing inventory by strengthening recycling, reducing stock disposal, and focusing on providing rental services.


 

Future Outlook

The size of the domestic retail market for shoes and footwear in FY2023 is forecasted to reach 1,147.7 billion yen, 102.4% of the previous year's level, based on the retail price. While there are negative factors such as product price hikes due to soaring raw material prices, the market is expected to grow positively thanks to strong sales of functional shoes, chiefly sports shoes, and a recovery of inbound demand. In particular, inbound demand that disappeared during the pandemic is expected to recover in a full-scale.

The number of foreign tourists to Japan has been increasing exponentially since Japan resumed visa-free travel and individual travel on October 11, 2022. According to the Japan National Tourism Organization (JNTO), the number of visitors to Japan in January 2023 was approximately 1.5 million, recovering to 55.7% of pre-COVID pandemic level (January 2019). The recovery in inbound consumption is driving the market growth, as seen in the increased duty-free sales reported mainly by retailers (retailers) operating in the central Tokyo area. Together with many positive factors that augment the market growth, such as the growing popularity of functional shoes for daily comfort and the spread of sustainable consumption (choosing products that impacts environmental less), the market is expected to expand hereafter despite the rapid decline in demand for leather shoes in both men’s and women’s.


 

Research Outline