Max Mushrooms were recently introduced to Pokemon Sword and Shield with The Isle of Armor DLC. The purpose of these mushrooms is to create Max Soup, which unlocks the Gigantamax form for your Pokemon. Keep in mind that only Pokemon that have a Gigantamax form can eat this soup.
For example, if you breed a Bulbasaur and evolve it to Venusaur, it can only Dynamax. But once you give it some Max Soup, it will be able to Gigantamax.
In order to create Max Soup, you must play through the storyline in Isle of Armor. Once you unlock the kitchen, you will have access to Max Soup. In order to make the soup, you need at least three Max Mushrooms. But when you see a Max Mushroom in the world, you only harvest one. So finding three can be quite the task at times.
One upside is that Max Mushrooms have set spawn locations. So when they do spawn, you can check the same areas every time. Max Mushrooms will only spawn in the Courageous Cavern, Forest of Focus, Warm-Up Tunnel, and Brawlers Cave. When you find a Max Mushroom, take note of where it spawned, so it is easier to find them in the future.
How can you get Max Mushrooms to respawn? They do not have respawn timers after all. Well, it is surprisingly simple. All you have to do, is do Max Raid Battles on the Isle of Armor – and you can do raids anywhere on the island. You do not have to only do raids in the areas the Max Mushrooms spawn in.
Every time you do a raid battle, there is a chance a Max Mushroom can spawn. Since there is only a chance for one to spawn, I recommend you do at least 3-5 raids before you go out searching. Multiple Max Mushrooms can spawn as you do more raids, so there is no harm in doing multiple raids on the island, and then going to check the spawn points. If you would rather not travel all over the island, you can use Wishing Pieces instead to do raids.
Unfortunately, going through all those raids is a lengthy process. To make them faster, you can turn off battle animations. You can also choose a Pokemon that can beat every raid on its own, so you do not have to constantly move your party around.
An Adamant Dracovish with the Strong Jaw ability, Fishious Rend, and Choice Band can take down nearly everything. Make sure you never Dynamax Dracovish though, because it loses a lot of strength when it Dynamaxes, since it will not get the benefit of Strong Jaw and its Choice Band.
The only Pokemon that Dracovish cannot face are Fairy types, and possibly some Dragon types. For these types of Pokemon, you can use Venusaur, Charizard, or Duraludon. You will want to Gigantamax or Dynamax these Pokemon. Make sure these Pokemon have their Dynamax level maxed out to give them a health boost.
Getting Max Mushrooms in the Isle of Armor DLC is a lengthy process, but it is worth the reward. With the Max Soup you can unlock the Gigantamax forms for your perfectly bred and trained Pokemon. Or, if you happened to get a shiny Pokemon you want to Gigantamax, then you can give it some Max Soup too. This gives players more freedom when creating their Pokemon teams.