Once moneymakers, Japan’s beverage vending machines see profits declining

TOKYO – Major beverage companies in Japan are reviewing their vending machine businesses one after another.

Once viewing them as highly profitable “moneymakers” they had increasingly installed the machines. But, due to sluggish sales and rising maintenance costs, their profitability has deteriorated in recent years. Some companies are taking the plunge and pulling out of the business.

Sluggish demand

In March, Pokka Sapporo Food & Beverage announced it would sell its beverage vending machine business to Lifedrink Company, a manufacturer and distributor of soft drinks. Pokka Sapporo had about 100,000 vending machines in operation at its peak, but the number has fallen to about 40,000 units today.

As to why it is selling the vending machine business, the company said: “Against a backdrop of rising sales prices and consumers’ belt-tightening, the demand has been sluggish. The business environment is getting increasingly harsh.”

In March, DyDo Group also announced plans to remove about 20,000 unprofitable vending machines out of a fleet of about 270,000 units across the country.

Although the vending machine business accounts for 90 per cent of its beverage business sales at home, it is reviewing its strategy because of sluggish sales.

Budget-conscious attitudes

Vending machines used to be the biggest source of profits for beverage manufacturers because they enabled them to sell their products at list prices, just like a company’s directly managed stores. Consequently, companies rushed to expand their machine networks.

However, when the consumption tax was raised from 5 per cent to 8 per cent in 2014, there emerged price disparities between vending machines and retail outlets such as convenience stores.

This is because retail stores can adjust their prices in units of one yen (one Singapore cent), whereas vending machines can adjust the prices only in units of 10 yen. As a result, consumers shifted to buying the products at convenience stores, leading to a decline in both sales through vending machines and the number of vending machines in operation.

Furthermore, the trend towards staying home amid the Covid-19 pandemic since early 2020 exacerbated the decline in sales.

Coupled with soaring maintenance costs such as electricity bills and distribution costs, the profitability of the beverage vending machine business deteriorated.

Against the backdrop of current price increases, consumers’ growing tendency to save money has also become a headwind.

According to Inryo Soken, a beverage market research firm, the number of vending machines selling soft drinks stood at 1.95 million units in 2025, down 20 per cent from 2014 when it peaked at 2.47 million units. The sales volume per machine fell to 205 cases per year, a drop of nearly 40 per cent from the peak.

Citing sluggish vending machine sales and other factors, Coca-Cola Bottlers Japan posted a loss of 88.3 billion yen for its fiscal year ended Dec 31, 2025, while Ito En, a leading green tea beverage maker, posted a 13.8 billion yen loss for the fiscal year ended April 30, 2026.

Fan merch, carbon dioxide capture

Nevertheless, vending machines serve as a connection between brands and consumers. There are also moves to add new value to them.

Suntory Beverage & Food aims to seize the demand related to “fan activities”. It is deploying vending machines featuring beverages with labels decorated with anime characters and other designs, and it plans to increase the number of these machines from 5,400 sites to 11,000 by 2028.

The company also said that it plans to install a new type of vending machine for acrylic cards and pin badges.

“We want to make this a pillar of our new vending machine business,” the company said.

Asahi Soft Drinks began adopting vending machines that can absorb carbon dioxide from the air in June 2023.

By placing a special carbon dioxide-absorbing material in the vacant space inside the vending machine, each unit is said to absorb about 60kg of carbon dioxide a year, roughly equivalent to the amount absorbed by 20 cedar trees.

Following the introduction, the company has expanded the installation of such machines at commercial facilities and schools. “We have been able to create new value with vending machines,” it said.

World’s oldest vending machine

The oldest vending machine in the world was a “holy water vending machine” said to have existed in ancient Egypt. The mechanism was such that when one inserted a coin, water would come out according to the coin’s weight. The water was said to have been sold for use in rituals and so on.

It was in Britain in the latter half of the 1800s when such vending machines as we see today first appeared, selling beverages and food products including snacks.

In 1962, Coca-Cola made a full-fledged entry into the Japanese market, leading to an increase in vending machines selling soft drinks.

Now, vending machines selling items other than beverages have become conspicuous. SDRS, a company that manufactures and sells vending machines, began selling frozen gyoza and ramen in partnership with food manufacturers in 2021.

It has also been rolling out “Meat Gacha” vending machines where customers can win premium meat, and machines selling local speciality gourmet foods.

The company said: “Vending machines can also help deal with the worsening labour shortage. We intend to expand our range of goods and services, going forward.” THE JAPAN NEWS/ASIA NEWS NETWORK