From January to July 2024, there has been a sharp increase in ramen shop bankruptcies. According to a survey by Teikoku Databank, the number of bankruptcies involving debts of over 10 million yen during this period reached 49 cases, nearly doubling from 53 cases in the previous year. At this pace, the number could surpass the record high of 2020, potentially exceeding 100 cases annually.
Many Ramen Shops Unable to Surpass the “1,000-Yen Barrier”
In central Tokyo, it is not uncommon for a bowl of ramen to cost over 1,000 yen. However, many ramen shops have maintained pre-COVID pricing of 600-800 yen, making the impact of rising costs a serious issue. The ramen industry faces a “1,000-yen barrier,” making price hikes difficult compared to other industries. As a result, maintaining prices while cutting costs has become increasingly challenging, leading to numerous closures and bankruptcies.
Significant Price Increases in Key Ingredients Like Pork and Back Fat
Prices for essential ingredients such as pork and back fat, crucial for making chashu and pork bone broth, have risen by nearly 20% year-on-year. Additionally, ingredients like noodles, nori, and bamboo shoots have seen price hikes due to poor harvests and the weak yen. Ramen shops that pride themselves on their broth often heat it for 24 hours, and rising utility costs have also significantly impacted their operations.
Causes of Bankruptcies: Rising Ingredient Costs and Increased Operational Expenses
The main reasons for the increase in bankruptcies are the rising costs of ingredients and increased operational expenses. Over the past three years, ramen ingredient costs have risen by more than 10%. According to Teikoku Databank’s estimates, the index for June 2024 stood at 113.5 compared to the 2022 average. The highest peak was 124.4 in October 2023, and prices remain high.
The increase in ramen shop bankruptcies raises concerns about the preservation of ramen culture. Measures are needed to continue operations while maintaining quality and seeking a “fair price” that consumers will accept.
Details of the survey can be found on the Teikoku Databank website.
Survey on Ramen Shop Bankruptcies (January-July 2024)
| Period | Number of Bankruptcies | Debt Amount (Over 10 million yen) |
|---|---|---|
| January – July 2023 | 53 | 10 million yen+ |
| January – July 2024 | 49 | 10 million yen+ |