Information Releases

Japan’s Business Failures in 1st Half Year 2020

(Released by TEIKOKU DATABANK, LTD.)

Highlight and Outstanding Feature

• ■There were 3,943 bankruptcies, in the first half of 2020 (3,998 in the same period of the previous year), marking the third consecutive year of decrease compared with the same period of the previous year. There was one bankruptcy of a listed company—Renown Incorporated (Tokyo, Civil Rehabilitation Act, First Section of the Tokyo Stock Exchange).
• ■Total liabilities in the first half of 2020 were 631,679 million yen (750,760 million yen in the same period of the previous year, down 15.9% year-on-year); this was the third consecutive year-on-year decrease and the lowest amount on a half-year basis since 2000 as a year that can be compared. The largest amount of liabilities was posted by White Bear Family Co., Ltd. (Osaka, Civil Rehabilitation Act, June) with liabilities of approximately 27,800 million yen.
• ■By industry, the number of bankruptcies decreased year-on-year in six of seven industries. Bankruptcies in the service industry (933 bankruptcies, down 3.9% year-on-year) marked a decrease for the first time in five years. On the other hand, the retail industry (935 bankruptcies, up 3.3% year-on-year) was the only one to see a year-on-year increase, and in particular the number of bankruptcies of restaurants (398 bankruptcies) was up 13.7%, the highest on a half-year basis since 2000.
• ■In terms of liabilities, there were five bankruptcies of companies with liabilities of 10 billion yen or more (down 28.6% year-on-year); for the first half, this was the lowest ever and roughly on a par with 2014 and 2017. Hence, the number of large-scale bankruptcies was at a low level.
• ■By region, four of nine regions experienced year-on-year declines. Due to factors such as the low number of bankruptcies in May, Kanto (1,307 bankruptcies, down 7.1% year-on-year) saw bankruptcies fall by double digits in Gunma, Tokyo, and Kanagawa. Among them, Tokyo (638 bankruptcies, down 12.1% year-on-year) marked the second-lowest figure since 2000.
• ■There were 85 bankruptcies caused by a labor shortage (down 4.5% year-on-year), marking the first year-on-year decrease in five years.
• ■There were 238 bankruptcies caused by a difficulty in finding a successor (up 15.5% year-on-year), marking the third consecutive year of year-on-year increase.
• ■There were 261 post-moratorium bankruptcies (up 2.0% year-on-year), marking the second consecutive year of year-on-year increase.