Japan Food Price Increases: Update October 10, 2024.

 

Japan to face price hikes on 2,900 food items in Oct., most in 2024

Article Source: https://mainichi.jp/english/articles/20240930/p2g/00m/0bu/017000c

Ideas:

Japan, unfortunately, is a resource poor country and has to import much of what is needs, meaning its subject to global price increases on raw material products and subject to the weak Japanese yen which cause domestic prices to increase a lot.

You would think maybe the Japanese government would find ways, such as trade agreements, to help lower the price of many products going into Japan.

For a long time, many Japanese companies were reluctant to pass-on their increase costs to retail consumers as they were afraid of losing customers. But this is a new era and now many company easily pass-on their costs as they need to maintain their profits margins.

Increased logistic costs have been going up since the pandemic and these is no other real example than looking at airline ticket prices and the extra cost that airlines now charge customers.

Labor costs is very much different a wage increases have increased, due to the Japanese government urging many companies to increase wages and of course companies will pass-on their labor costs to the next in the supply chain including the final retail customer.

Recently, unfortunately, there have been reports of some companies going out of business because they couldn't afford the increased wage increases and or at the same time could find enough labor for their company, as again, they couldn't afford to pay what workers want or need.

Labor costs, most likely are going to continue to increase, which means more companies pass-on their labor costs to whomever in the supply chain, which means more price increases in Japan for the time being.

Maybe if Japanese companies had been increasing wages consistently over the years, there would not be this crisis on price increases now in Japan.

You can't blame the weak Japanese yen for all of Japan's ills as again, if companies had been increasing wages consistently, instead of all deciding around the year 2000 not to increase wages, there would not be the current wage increase crisis and price increases on products.

This is a situation, again, the could have been avoided if Japanese companies would have just increased wages consistently and not tried to avoid wage increases as many Japanese companies tried to do back in 2000, as they were following the leader, which at the time was Toyota which Toyota decided not to increase wages at the time, and the it just continued on on since then, until 2023 when many companies, due to the Japanese governments urging decided to increase wages again.

Have a nice day!