What is the current condition of sake in the country that it calls home—Japan? In short, not good. The overall sake industry has seen a rapid decline in the last 15 years—a decline so severe that many say it is in a free fall. Overall sales have plummeted and the national industry has seen its fair share of closures and other problems associated with a downward market. The question is: why?
There are many reasons for this lack of demand, especially with the lower grade categories referred to as common sake, or regular sake (think "table sake"). First, sake competes with many different types of alcohol in a country that is notorious for drinking. There are a myriad of “alternative” beverages from beer and wine to distilled alcohols such a whiskey and shochu. As many drinkers are value conscious, they seek out the best bang for the buck, which is usually distilled alcohols. Recently, the country went through a shochu boom that saw an explosion of demand for a product that has a decent value-to-quality ratio—something that is unheard of in the contemporary sake market.
Adding to that, there is seemingly a lack of national pride when it comes to Japan’s original drink. In fact, the in Japan the younger generation commonly refers to sake as “your father or grandfather’s drink.” Young consumers who would rather drink alcoholic beverages imported from other countries. Another challenge is that the under-30 consumers have a limited disposable income and limited access to quality sake. Why drink poorly made sake when you can get a good bottle of buckwheat shochufor approximately the same price? Likewise, the beer market has changed considerably to craft new styles of higher alcohol beers that attract drinkers.
The point is that there is an arms race in Japan between booze industries and sake; the latter is running almost always the loser in this race. One leg-up for sake is its association with ceremony, celebrations, and traditional events where sake drinking is paramount. However, even this advantage is losing ground to those who would rather gift a bottle of shochuthan nihonshu.
Also,the major sake breweries have to re-evaluate their ways of doing business and what they produce. Sake was king for centuries and now these massive breweries have to come to grips with the fact that the modern market is no longer supporting them. These brewers move at glacial speeds, and often get caught by surprise when trends change as they always do. The sake industry is also notorious for being extremely poor with their marketing and advertising, which is best highlighted by a recent campaign that suggested drinkers consume a glass of water for every glass of sake to avoid getting excessively drunk.