Market Overview

The market size of Japanese and Western-style confectionery and desserts for FY2023 as a total of Japanese confectionery, Western-style confectionery, desserts (yogurt, custard pudding, jelly, or other chilled desserts) and frozen desserts (ice creams, other frozen snacks) was estimated at 2,424,800 million yen, up by 7.0% from the preceding fiscal year (based on the shipment value of manufacturers). 

The market for Japanese and Western-style sweets and desserts benefited from the overall recovery in foot traffic in FY2023, as the COVID situation subsided and demand for tourism and souvenirs increased. Although several manufacturers raised product prices due to higher raw material costs, the rebound in consumer activity helped maintain sales levels.

Conversely, the market environment grew slightly more challenging for Japanese and Western-style confectioneries and desserts sold at mass merchandisers and convenience stores, as consumers became more cautious about spending. Meanwhile, the extended selling season driven by global warming supported continued growth in ice cream sales.

Noteworthy Topics

Sales Channel Trends

The Japanese and Western-style confectionery and desserts market for FY2023 by composition ratio per sales channel were as follows: department stores 16.7%, specialty stores & free-standing stores (including specialty stores within shopping centers) 6.1%, mass-merchandisers 35.8%, convenience stores 19.1%, in-station stores & station buildings 3.9%, airports 3.3%, highway parking area and service area 1.0%, mail order 4.8%, and others (including corporate demand) 9.2%.

With the nationwide recovery in foot traffic beginning in FY2023, sales of confectionery and desserts expanded in many channels, including department stores and transportation channels. Mass merchandisers and convenience stores (CVS) had strong sales, too, with convenience stores in particular showing notable year-over-year growth. In contrast, mail-order channels experienced a slowdown.

Future Outlook

In the Japanese and Western confectioneries segment, some companies successfully increased sales by raising product prices in response to rising raw material costs. However, others experienced a decline, as the recovery in demand for gifts and souvenirs plateaued in FY2023 and consumer sensitivity to pricing worsened. A decrease in both sales volume and unit prices appears inevitable. While purchases by inbound tourists (foreign visitors to Japan) may partially offset the decline in domestic consumption, companies that primarily target Japanese consumers are facing a challenging environment.
In the dessert segment, ice cream sales have remained strong, driven by an extreme hot summer, prolonged summer weather, and a mild winter. Strong ice cream sales are expected to have a positive impact on the overall confectionery and desserts market.

Research Outline