Financial Observation: The "Exit" of Vending Machines Reflects Changes in Japan's Economy

Question AI · What are the economic driving factors behind Japan’s automated vending machine exit?

【Special Correspondent Shao Nan, Japan, Global Times Reporter Li Xun】Japan is known as the “biggest country of vending machines.” However, in recent years, the number of vending machines visible on Japanese streets has been decreasing, with many companies beginning to cut back or withdraw from this sector. Meanwhile, Japanese consumers’ shopping habits are quietly changing. These changes are not only due to competition in retail channels but also reflect shifts in Japan’s economic environment, consumption structure, and labor conditions.

Tokyo street beverage vending machines. (Visual China)

“Almost no profit to speak of”

Recently, multiple Japanese media outlets have paid attention to this phenomenon. Kansai TV reported that the number of vending machines in Japan has decreased by about 370,000 over the past decade. Once ubiquitous on the streets, many vending machines have now disappeared in some areas.

An interview with Tokyo Broadcasting System (TBS) shows a clear trend of young consumers using vending machines less. One respondent in their twenties said that drinks that used to cost around 100 yen (about 4.3 RMB) at vending machines are now nearly 200 yen, so they rarely buy drinks from vending machines anymore. Other consumers mentioned that drinks at convenience stores and discount stores are cheaper, so they generally do not choose vending machines.

Changes in consumer behavior are directly impacting vending machine businesses, prompting companies to adjust. Food and beverage company Pokka Sapporo announced it will spin off its vending machine operations by October 2026. The company cited increased consumer savings consciousness, sluggish market demand, and rising maintenance costs as key reasons for this decision. Another beverage company, DyDo Group, also announced it would withdraw about 20,000 of its approximately 270,000 vending machines nationwide. DyDo reported a loss of 30.3 billion yen in its January 2026 fiscal year, the largest in its history. Since vending sales account for 90% of its Japanese beverage revenue, the company has had to scale back.

Industry-wide pressure is also reflected in corporate financial reports. Ito En recorded a 13.7 billion yen loss related to vending machines in its January 2026 fiscal report; Coca-Cola Japan also reported a 90.4 billion yen loss in its 2025 financials related to vending operations. Once a stable sales channel for beverage companies, vending machines are increasingly becoming a cost burden.

For vending machine operators, profits are also declining. A store manager at a liquor retail shop in Osaka said that each vending machine earns only about 10,000 yen per month, sometimes as little as 8,000 yen, almost no profit.

Why are vending machines popular in Japan?

According to data from Japan’s Automatic Vending System Mechanical Industry Association, Japan has about 2.2 million beverage vending machines. Vending machines can be found everywhere in Japan, from city streets to remote mountain villages.

The popularity of vending machines in Japan is closely related to the sales strategies of beverage companies. Industry insiders believe that vending machines first appeared in Japan in connection with Coca-Cola’s entry into the Japanese market. Companies used vending machines as a sales channel to promote their drinks, leading to rapid expansion of this sales model.

Japan’s vending machine industry has also developed a unique operational system. Besides manufacturing equipment, companies have established dedicated operations firms responsible for restocking, maintenance, and cash collection. This comprehensive system has enabled vending machines to operate stably over the long term.

Huo Jiangang, a researcher at the China Institute of Modern International Relations, states that Japan’s large-scale vending machine deployment is based on several fundamental conditions. First, vending machines occupy small land areas, allowing efficient use of scattered spaces in land-scarce cities like Tokyo and Osaka, significantly reducing operating costs. Second, Japan’s prevalent overtime culture means 24-hour vending machines can meet the nighttime needs of office workers. Third, early Japanese convenience stores had low density, and vending machines filled a gap in convenient retail services. Lastly, Japan’s social culture of avoiding unnecessary human contact aligns with unmanned consumption modes.

With widespread use, the types of products sold via vending machines in Japan have increased. Besides drinks and snacks, there are machines selling ramen, beef, rice bowls, and even umbrellas and perfumes.

Changes in consumer environment and economic structure

The decline in vending machine numbers is driven by changes in Japan’s consumer environment and economic structure. Due to rising prices, Japanese consumers have become more price-sensitive. Drinks in vending machines are generally more expensive than in supermarkets and discount stores—for example, a regular green tea costs about 160 yen, while in supermarkets it costs just over 100 yen, and convenience stores around 120 yen. A reporter from the Global Times visiting Japan usually prefers convenience stores or small supermarkets for drinks, as they are cheaper, have more variety, and offer points.

Labor issues are also a challenge for the industry. Vending machines require staff for restocking and maintenance, but it is increasingly difficult for companies to recruit such workers, leading to the removal of underperforming machines. During a hike in Kamakura, a vending machine on a hillside was managed by a small tea shop owner. The owner said he is getting older and plans to work for another five or six years; if the tea shop closes, no one will be responsible for the vending machine.

Huo Jiangang analyzes that Japan’s vending machine market is shrinking due to multiple factors. First, consumer price sensitivity has increased. With ongoing inflation and real wages declining year after year, people are becoming more rational in their spending, making vending machines less competitive on price. Second, rising labor and logistics costs—Japan’s tight labor market, stricter truck driver overtime controls, and increased costs for logistics, maintenance, and cleaning—add significant operational pressure. Third, payment technology has lagged; most Japanese vending machines are legacy cash-based systems. Although cashless payment upgrades are possible, the high costs of modernization under thin profit margins lead operators to phase out old equipment. Fourth, companies are optimizing their deployment strategies by removing low-efficiency locations and focusing on high-value areas like stations, office districts, and scenic spots, which also reduces overall numbers.

Despite the overall decline, some industry insiders believe vending machines will not disappear entirely. During the pandemic, some restaurants sold dumplings and ramen via vending machines, which renewed interest in the concept. Since then, vending machines for frozen foods have gradually increased.

However, the Financial Times reports that although vending machine operators are adjusting strategies to improve profitability, some independent retail analysts question whether companies can continue investing in vending machine businesses amid declining sales.