Market Overview

Linen rental services provide linen products to hotels, hospitals, restaurants, amusement facilities, offices, and factories. The Japan’s linen rental services market in FY2025 grew by 3.6% from the previous fiscal year to attain 538,800 million yen (based on the sales of linen rentals). The market achieved growth for five consecutive years. Market growth was primarily driven by hospitality linen, fueled by an influx of inbound tourists following the containment of the pandemic.

Noteworthy Topics

Market Trends in Recent Years

In recent years, the linen rental industry has faced a severe, chronic labor shortage that operational efficiencies and aggressive hiring can no longer resolve. This challenge is further compounded by an aging workforce.

Meanwhile, inbound tourism is projected to surge, driven by Japan’s goal to attract 60 million foreign visitors by 2030 under the Tourism Nation Promotion Basic Plan. To maintain services for the hospitality sector, linen rental companies urgently need to secure a stable workforce.

To address this, the linen supply sector is scheduled to be included in the Specified Skilled Worker (SSW) program starting in FY2027. This inclusion will allow companies to hire foreign nationals who possess the requisite knowledge and skills.

Looking ahead, the sector may also become eligible for the Specified Skilled Worker Category Two (SSW-2) program, which offers unlimited visa renewals and could significantly improve long-term employee retention for linen rental businesses.


 

Future Outlook

The domestic linen rental services market is projected to attain 539,800 million yen in FY2026, representing 100.2% of the previous fiscal year. The market is projected to bifurcate into growth segments and decline segments.

The hotel linen segment is projected to achieve steady year-over-year growth, expanding by 4.0% in FY2026 and 2.4% in FY2027. Driven by surging inbound tourism that increases hotel room occupancy rates, this segment will solidify its role as a primary market driver, accounting 38.2% of the total market mix in FY2026 and 39.2% in FY2027.

Similarly, healthcare linen, restaurant linen, wellness facility linen, and industrial linen segments are all anticipated to experience consecutive years of growth, maintaining 100% to 102% of their previous fiscal year performance. This stability is underpinned by strong hygiene demands in healthcare and a moderate recovery within food service sector.

In contrast, the transportation linen segment faces a sharp downturn. It is projected to decline by 12.8% in FY2026 and 17.1% in FY2027, driven by airlines and rail companies cutting back on onboard amenities and reducing overall facility and equipment management costs.

The diaper segment is also forecast to contract, dropping by 6.1% in FY2026 and 6.8% in FY2027, primarily due to structural challenges like declining birthrate. Meanwhile, hand towel rentals will see a moderate decline as rising hygiene awareness accelerates the shift toward disposable alternatives.

Finally, the steepest drop will occur in the facility hygiene products segment, which is expected to plunge by 4.2% in FY2026. While a projected 3.8% decline in FY2027 may hint as a slight stabilization, the underlying trend remains weak. Demand for these products will continue to shrink as automation and operational streamlining reduce the workforce in the manufacturing and distribution sectors.


 

Research Outline