Teikoku Databank (TDB) has revealed that 60% of inn and hotel operators in Japan have reported a positive business sentiment.
The average sale price remains high, and the price per person for domestic overnight trips in 2023 reached ¥63,212, a 14.8% increase compared to 2019. This price increase is attributed to the surge in demand due to revenge spending, rising costs of raw materials and energy, progression in passing costs onto prices, and wage increases. The recovery in the number of foreign tourists to Japan has also contributed to the increase in demand, accelerating the rise in prices.
According to a survey by Teikoku Databank, the proportion of inns and hotels reporting a rise in sales prices has exceeded 60% for twenty consecutive months since August 2022, and as of March 2024, 75.3% perceived an increase, indicating that four out of three businesses noted higher prices.
Teikoku Databank predicts that increased prices for accommodation will continue, driven by the need to address severe labor shortages, and the sustained high costs of amenities, linen-related expenses, heating, and cooling. Consequently, as domestic revenge spending starts to cycle through, businesses are forced to address consumer alienation from lodging by developing uniqueness, rarity, and a sense of luxury, thereby indicating a pronounced survival of the fittest competition among them.
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