Market Overview

The baby and children's clothing market reached 838,500 million yen in 2023, marking a 2.6% year-over-year increase and the third consecutive year of growth. This growth was driven by higher product unit prices and recovered demand from inbound tourists. After plummeting in 2020 due to the pandemic, the market has experienced level offs and slight increases over the past few years. However, it has yet to recover to its pre-pandemic level in 2019.

Despite the ever-declining domestic child population, the market size for baby and children's clothing has not shrunk. One reason for this is the robust consumer demand for affordable specialty store chains and casual apparel outlets for baby and children’s clothing.

Noteworthy Topics

Companies’ Efforts against Soaring Material Prices

Material costs skyrocketed in 2021 and have continued to rise ever since. The reasons are the weaker yen, wage increases, and higher material and transportation costs. Until 2021, companies were reluctant to quickly raise prices to protect their profits against soaring material costs. However, after reaching their limits for enduring ever-rising costs, companies have become unhesitant to revise prices in recent years.
Additionally, rising food prices, public utility charges, and petroleum prices burden households to no small extent, affecting their clothing purchase intentions and opportunities.

Companies continue to seek price increases, while minimizing gaps in the event of actual price revisions by reviewing the production processes and preventing dead stock. They also strive to improve the product quality to justify the revised prices to consumers.

Future Outlook

The baby and children’s clothing market in Japan increased only slightly by 0.2% from the previous year, reaching 840,500 million yen in 2024. The market is expected to decline gradually while periodically leveling off in the future. However, the market may not decline considerably if companies’ efforts work effectively to improve profits through increased product unit prices. 

Some specialty baby and children’s clothing chains focus on overseas development. To succeed overseas in five to ten years’ time, companies must understand the demand structure and trends of baby and children's apparel in each country from early on. Since the demand for higher-priced products is greater overseas than in Japan, where consumers tend to prefer lower-priced products, though the situation may differ by country, high-price range strategies and overseas development will be increasingly important for expanding the baby and children’s apparel business.
Business success lies in product development that responds to consumer needs. Focusing on product quality, safety, and eco-friendliness, as well as expanding sales through digital methods and enhancing higher value added products are likely to contribute to business growth.

Research Outline