I was just in Japan two weeks ago, and convenience stores were omnipresent. I'll admit, it was incredibly convenient, as I never went for lack of food or water, and I got into habit of grabbing a beer and a snack every night to take back to my hotel room before bed. I was relying on them (and vending machines) pretty heavily for coffee and green tea throughout the day as well.
There were way too many convenience stores that were open in the middle of the night, though (and apparently this is a requirement on the franchisees). There was a 24/7 convenience store on the first floor of my hotel, and then another one down the block, and then several more within a two block radius. There's no reason they couldn't all coordinate better so that each individual store is only open through the night a couple times per week. That would make a lot more sense. Most customers would still be able to reach an open convenience store, even in the middle of the night, within a few blocks walk. It'd be nice if stores had posted the hours of nearby stores so you'd know where else to go if the one you wanted was closed, but that's probably unnecessary now in the age of apps (I had no problem finding opening times for places on Google Maps).
Pharmacies in Poland all operate on this rotating schedule, where at least one pharmacy in town is open 24h(they always post a sign saying where the nearest 24h pharmacy is). I have no idea if it's by law or just a thing that everyone does.
> There's no reason they couldn't all coordinate better so that each individual store is only open through the night a couple times per week. That would make a lot more sense.
You incorrectly assume their primary goal is to provide service to customers.
Their primary goal is to maximize profits, and in a saturated market the only way to do that is by trying to take market share from the competition.
I studied this as part of my degree. It's mostly the ice cream vendors problem, where apparently the franchises would prefer to saturate a smaller area with competitors than a larger area with no competition.
It's probably an oversimplification but it is painfully evident when walking around metro areas of Japan.
I was there about a year back and I too remember thinking why they had so mayn vending machines, and also at seemingly odd/random spots. It felt a bit shady buying alcohol from a vending machine without showing ID, but maybe thats just cultural conditioning..
Don't underestimate the safety factor. Walking around late at night past scores of open stores presents a significantly different backdrop to other cities around the world where everything is closed and all the lights are off.
I also just came back from Tokyo and Osaka; I was blown away by how many 7/11s there were and how close they were.
The vending machines are amazing. One other thing I would like to import: the widely available, clean bathrooms all over the place. That was super nice.
Free public bathrooms everywhere was nice, but there was still a dearth of free public water fountains -- which, admittedly, most cities don't have enough of. Rome is kind of the gold standard in this regard.
I loved how some of the vending machines and convenience stores sold hot canned drinks. I've never seen that anywhere in the US. Now the hot canned coffee wasn't actually good (I had to try it), but it was interesting to have that as an option. There were also plenty of vending machines that would make coffee for you (which I didn't use because I opted for free coffee in the hotel in the morning and cold green tea thereafter, which I must say was delicious).
I’ve noticed that the number of usable combini toilets is on a steep decline in major cities and tourist areas.
A few years ago they were all public and free to use at any time. Then English signs saying “Close the door. Don’t make a mess. Don’t stand on the toilets. Don’t do (xyz common sense thing)” started popping up. Then I saw a few saying “please alert staff if you’d like to use the toilets and we will give you a key”. Now most conbini in Tokyo suspiciously have two separate offices and zero toilets. If it’s an area with mostly foreigners, your chances of finding a toilet really fall off a cliff.
>One other thing I would like to import: the widely available, clean bathrooms all over the place. That was super nice.
Don't forget how almost every public restroom even has a washlet.
But we can't have these things in the US. Americans can't even be bothered to flush the toilet, and like to scrawl graffiti on bathroom walls. The only way we'd have the super-clean public bathrooms of Japan is to keep them locked, or have a pay-per-use scheme with cameras monitoring them to see who pees on the toilet seat without cleaning it.
Just came back from Japan and man are there too many convenience stores. Within any given area there is probably 6 to 7 stores within eyeshot and an easy walk. It's weird thinking that they are too convenient, but honestly they start to become pointless. More than once we simply walked by a few knowing that there would be another one just a minute or two more down the street.
It's great that we could find something to eat at 2am when jet lag messed with our eating schedule and nothing else was open except the four 24-hour chain restaurants, 6 full-service Izakayas and a late night curry shop within a 5 minute walk. What would we have ever done without a choice of 6! different convenience stores within the same area?!
Oh and on the way there's vending machines literally jammed into every available urban crack that can fit one where I can service most of my beverage and a few food needs.
I couldn't figure out how these places earn enough money to keep the lights on given the competition, now I guess I know.
> Within any given area there is probably 6 to 7 stores within eyeshot and an easy walk.
That's just Tokyo and it's a very biased impression. Most places in Japan don't have that kind of density of combinis. I there there are about 55 000 combini in Japan, and there's probably 20% of that in Tokyo alone so you were in an area that's not representative of japan as a whole. In most other other cities there's rarely more than one combini at the same place, and you would not see 5-6 of them just by walking 5 minutes.
> I couldn't figure out how these places earn enough money to keep the lights on given the competition, now I guess I know.
Of course they earn money. They sell products with a high markup (like 30% more than everything you find in a supermarket), they have their own lines of products with even higher profit margins, and there's usually a density of population that guarantees a minimum of business viability anyway. Never seen a combini owner that was poor or having a hard time to make ends meet.
I mean, I lived there for 5 years of my life and go back often... the alternatives open at 2AM only really exist in the tourist areas or the uber dense areas (Shinjuku, etc). Past 2, you're pretty much only eating conbini food or a "family restaurant" like Denny's, Johnathans or Royal Host if you're lucky enough to be near a 24 hour one.
Compared to what? Here in the USA there are several places within walking distance from my home that have a Starbucks across the street from another Starbucks. One of them is an intersection where 3 of the 4 corners have a Starbucks. There's at least one building here with 2 Starbucks in it, in case taking the elevator is too much hassle. Japan doesn't sound all that much different in this respect.
As the other person said, outside of major areas Konbinis are pretty much the only option to get anything at late. Other 247 stores are relatively rare.
Keep in mind the population density of Tokyo is around 6,224.66/km2 (16,121.8/sq mi). Not going to do the detailed math, but let's say each store has a customer base of a .5 square miles. That's over 4k population. That seems to be plenty of customers to justify the store placement.
They probably have the density and business to support it. Like how the USA having so many gas stations everywhere might seem bizarre to someone from another country (e.g. gas stations in China are definitely nowhere near as numerous).
I was there a couple weeks ago and it is not as dense as Hong Kong or Bangkok. And thank god they had that many, otherwise the lines will be unbearable.
I currently stay in japan. The competition here is intense when it comes to food and drink. Every alley, even in residential areas in the back of the houses, has some mom & pop operated hole in the wall eatery. I never see more than two customers at many of these places at a time, but they stay open ungodly hours. I can't imagine they would be making more than $2-3 an hour on the average after all the costs.
A lot of family run retail shops all over the world/Asia seem to have this misconception that family labour is free, thus their employees/children/siblings are effectively working for below minimum wage.
One advantage of the prolific Japanese convenience store (or "konbini") is that any improvement in the underlying franchise system can be rapidly deployed to all franchisees (like nodes in a network). This is true of many franchises, but the konbini are exceptionally prolific, so this effect is magnified.
For example, if there is an opportunity to increase efficiency, or reduce costs or environmental impact, it would be relatively easy to deploy this throughout an entire franchise, as compared with heterogenous stores.
As for the issue of opening hours, labour shortages and demographic trends (the population is aging and decreasing) are significant. I am only aware of two likely solutions which are not mutually exclusive: (1) immigration; and (2) automation, ie. robots. Increasing the fertility rate might also address this issue, but seems less likely to happen.
I guess smaller opening times would also solve the issue. I have yet to understand why societies tolerate such things as stores open at 3am, given the productivity it has, and the implications for workers.
It’s a bit brushed over and sprinkled in the article but this part was brutal:
> Last year, when Fukui Prefecture was hit by the heaviest snowfall in decades, it was discovered that a 7-Eleven franchise store was banned by the parent company from closing temporarily even after the store owner’s wife fell ill from overwork.
> He lost his wife in May last year and he “was on the verge of falling ill or dying from karōshi (death from overwork),” he said.
It summarizes for me how extreme the relation is between franchise and the owners, how little escape they have from that abusive bind.
It’s not clear no one wants them, since there is little data available to an ex-salaryman looking to open one in a particular neighborhood and if you do an unsophisticated “just watch a store all day” competitive analysis both a thriving store and a struggling store appear busy at all hours of day and night.
The franchisor is basically uniformly in favor of more locations since the franchisee bears most startup costs and the franchisor gets an effective call option on their cash flow.
(It’s also not clear to me that convenience stores are oversupplied relative to demand; there are probably some geographic mismatches but in e.g. this neighborhood in Tokyo you can find 3 in a Us city block and they’re self-evidently very viable. Which you might ask “How is that self-evident?” and I’m left to say “Trust me.”)
I don't understand the demand from the parent company to stay open late, given the lack of customers they clearly have and the oversupply of combini. I was at a 7-11 in Osaka by the dotonbori and it was basically vacant.
Like many things in Japanese society it seems to be because "this is the way it's done".
You live in a country with franchises, right? What would you articulate as the brand promise of a McDonalds? McDonalds has a very clear internal understanding of that brand promise: it includes clean bathrooms, a smile, extremely low prices available, and very consistent food.
7/11 also has a brand promise. It includes, prominently, “If you need it, 7/11 is open.”
The LTV of a conbini regular is very, very, very high and the brand does not want you to sour on it for reasons specific to Store 6548 in May 2019.
It's not just 7-Eleven. I wouldn't want to be a franchisee of any sort in the US. The power dynamic is horrible.
McDonald's is probably one of the better ones. But you're still beholden to them. They often own the land under the building, if not the building itself. They tell you exactly what you must do. They tell you when to remodel. They make you buy from their suppliers. They can decide to open another store a mile away from yours.
But longer term I think the worst franchise to be in will be car dealerships. Once EVs become mainstream, the service revenue will fall by about 80%. There's just so much less to go wrong. How will dealers be able to pay for the overhead of their giant buildings?
I admire the courage of people who run their own business but I don't think that life would ever be for me. I love working 40-48 hours a week and leaving my work at work when I go home.
It would seem that this is ripe for automation, no?
In fact, I've been surprised for some time that there hasn't been a greater development/proliferation in this area. It would seem that a large (room-sized) refrigerated vending machine offering a range equivalent to a small convenience store is already highly technologically feasible, and would probably be far more cost efficient (smaller footprint, much lower staffing requirements) than running a convenience store.
Inspite of having 7/11 at every nook and corner ( specially in Tokyo/Yokohama), it would be hard to get a sandwich, obento(お弁当) or onigiri if you go to a convenience store (コンビニ) just after peak lunch time.
It's a pretty solid assumption in economics that in an industry with perfect competition, profit margins eventually converge with the benchmark interest rate.
The irony is, of course, that the chain is named "Seven-Eleven" because it was originally open from 7 am to 11 pm.
> One Monday night in late March, only 10 customers came to the man’s store in the three hours before dawn, and the sales during that time were a little more than ¥6,000. The store will be in the red if he hired someone for night shifts.
Smart management would close the store during those hours. Of course, the franchise doesn't care for smart management - when the operator eats the loss.
I think what they're getting at is that if you want to operate a 7-Eleven, you ought to be absolutely reliably open at the expected hours. The intended alternative is to shut down the store. This man made a terrible business decision and is now stuck between a sunk cost and probably not a lot of alternatives for work.
The article specifically states that 7/11 is preventing various stores from not being open 24/7. E.g. small store, wife is utterly ill, 7/11 doesn't care; store needs to stay open.
It seems they like the owner exhausted so they cannot do the things which makes sense. E.g. to sell the food which is close to the expiry date instead of throwing it out. Yet another example from the article.
[+] [-] CydeWeys|6 years ago|reply
There were way too many convenience stores that were open in the middle of the night, though (and apparently this is a requirement on the franchisees). There was a 24/7 convenience store on the first floor of my hotel, and then another one down the block, and then several more within a two block radius. There's no reason they couldn't all coordinate better so that each individual store is only open through the night a couple times per week. That would make a lot more sense. Most customers would still be able to reach an open convenience store, even in the middle of the night, within a few blocks walk. It'd be nice if stores had posted the hours of nearby stores so you'd know where else to go if the one you wanted was closed, but that's probably unnecessary now in the age of apps (I had no problem finding opening times for places on Google Maps).
[+] [-] gambiting|6 years ago|reply
[+] [-] brazzy|6 years ago|reply
You incorrectly assume their primary goal is to provide service to customers.
Their primary goal is to maximize profits, and in a saturated market the only way to do that is by trying to take market share from the competition.
[+] [-] redact207|6 years ago|reply
It's probably an oversimplification but it is painfully evident when walking around metro areas of Japan.
[+] [-] la_barba|6 years ago|reply
[+] [-] ferros|6 years ago|reply
[+] [-] RyJones|6 years ago|reply
The vending machines are amazing. One other thing I would like to import: the widely available, clean bathrooms all over the place. That was super nice.
[+] [-] CydeWeys|6 years ago|reply
I loved how some of the vending machines and convenience stores sold hot canned drinks. I've never seen that anywhere in the US. Now the hot canned coffee wasn't actually good (I had to try it), but it was interesting to have that as an option. There were also plenty of vending machines that would make coffee for you (which I didn't use because I opted for free coffee in the hotel in the morning and cold green tea thereafter, which I must say was delicious).
[+] [-] fiblye|6 years ago|reply
A few years ago they were all public and free to use at any time. Then English signs saying “Close the door. Don’t make a mess. Don’t stand on the toilets. Don’t do (xyz common sense thing)” started popping up. Then I saw a few saying “please alert staff if you’d like to use the toilets and we will give you a key”. Now most conbini in Tokyo suspiciously have two separate offices and zero toilets. If it’s an area with mostly foreigners, your chances of finding a toilet really fall off a cliff.
It was nice while it lasted, I suppose.
[+] [-] magduf|6 years ago|reply
Don't forget how almost every public restroom even has a washlet.
But we can't have these things in the US. Americans can't even be bothered to flush the toilet, and like to scrawl graffiti on bathroom walls. The only way we'd have the super-clean public bathrooms of Japan is to keep them locked, or have a pay-per-use scheme with cameras monitoring them to see who pees on the toilet seat without cleaning it.
[+] [-] odiroot|6 years ago|reply
[+] [-] thoughtfunction|6 years ago|reply
[+] [-] bane|6 years ago|reply
It's great that we could find something to eat at 2am when jet lag messed with our eating schedule and nothing else was open except the four 24-hour chain restaurants, 6 full-service Izakayas and a late night curry shop within a 5 minute walk. What would we have ever done without a choice of 6! different convenience stores within the same area?!
Oh and on the way there's vending machines literally jammed into every available urban crack that can fit one where I can service most of my beverage and a few food needs.
I couldn't figure out how these places earn enough money to keep the lights on given the competition, now I guess I know.
[+] [-] ekianjo|6 years ago|reply
That's just Tokyo and it's a very biased impression. Most places in Japan don't have that kind of density of combinis. I there there are about 55 000 combini in Japan, and there's probably 20% of that in Tokyo alone so you were in an area that's not representative of japan as a whole. In most other other cities there's rarely more than one combini at the same place, and you would not see 5-6 of them just by walking 5 minutes.
> I couldn't figure out how these places earn enough money to keep the lights on given the competition, now I guess I know.
Of course they earn money. They sell products with a high markup (like 30% more than everything you find in a supermarket), they have their own lines of products with even higher profit margins, and there's usually a density of population that guarantees a minimum of business viability anyway. Never seen a combini owner that was poor or having a hard time to make ends meet.
[+] [-] Klonoar|6 years ago|reply
[+] [-] ken|6 years ago|reply
[+] [-] asutekku|6 years ago|reply
[+] [-] frutiger|6 years ago|reply
[+] [-] SapporoChris|6 years ago|reply
[+] [-] unknown|6 years ago|reply
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[+] [-] seanmcdirmid|6 years ago|reply
[+] [-] csomar|6 years ago|reply
[+] [-] frequentnapper|6 years ago|reply
[+] [-] SenHeng|6 years ago|reply
[+] [-] wiggler00m|6 years ago|reply
For example, if there is an opportunity to increase efficiency, or reduce costs or environmental impact, it would be relatively easy to deploy this throughout an entire franchise, as compared with heterogenous stores.
As for the issue of opening hours, labour shortages and demographic trends (the population is aging and decreasing) are significant. I am only aware of two likely solutions which are not mutually exclusive: (1) immigration; and (2) automation, ie. robots. Increasing the fertility rate might also address this issue, but seems less likely to happen.
[+] [-] pyrale|6 years ago|reply
[+] [-] hrktb|6 years ago|reply
> Last year, when Fukui Prefecture was hit by the heaviest snowfall in decades, it was discovered that a 7-Eleven franchise store was banned by the parent company from closing temporarily even after the store owner’s wife fell ill from overwork.
> He lost his wife in May last year and he “was on the verge of falling ill or dying from karōshi (death from overwork),” he said.
It summarizes for me how extreme the relation is between franchise and the owners, how little escape they have from that abusive bind.
[+] [-] baroffoos|6 years ago|reply
[+] [-] patio11|6 years ago|reply
The franchisor is basically uniformly in favor of more locations since the franchisee bears most startup costs and the franchisor gets an effective call option on their cash flow.
(It’s also not clear to me that convenience stores are oversupplied relative to demand; there are probably some geographic mismatches but in e.g. this neighborhood in Tokyo you can find 3 in a Us city block and they’re self-evidently very viable. Which you might ask “How is that self-evident?” and I’m left to say “Trust me.”)
[+] [-] psychomugs|6 years ago|reply
[+] [-] jen729w|6 years ago|reply
[0]: https://www.theguardian.com/commentisfree/2016/may/12/7-elev...
[1]: In the major metropolitan areas.
[+] [-] jorblumesea|6 years ago|reply
Like many things in Japanese society it seems to be because "this is the way it's done".
[+] [-] patio11|6 years ago|reply
7/11 also has a brand promise. It includes, prominently, “If you need it, 7/11 is open.”
The LTV of a conbini regular is very, very, very high and the brand does not want you to sour on it for reasons specific to Store 6548 in May 2019.
[+] [-] raverbashing|6 years ago|reply
Owning a convenience store is a hard proposition
[+] [-] PhantomGremlin|6 years ago|reply
McDonald's is probably one of the better ones. But you're still beholden to them. They often own the land under the building, if not the building itself. They tell you exactly what you must do. They tell you when to remodel. They make you buy from their suppliers. They can decide to open another store a mile away from yours.
But longer term I think the worst franchise to be in will be car dealerships. Once EVs become mainstream, the service revenue will fall by about 80%. There's just so much less to go wrong. How will dealers be able to pay for the overhead of their giant buildings?
[+] [-] coldtea|6 years ago|reply
E.g. "no second franchize store in 1 mile radius" (of course this could differ from place to place based on market and population density).
[+] [-] Causality1|6 years ago|reply
[+] [-] mft_|6 years ago|reply
In fact, I've been surprised for some time that there hasn't been a greater development/proliferation in this area. It would seem that a large (room-sized) refrigerated vending machine offering a range equivalent to a small convenience store is already highly technologically feasible, and would probably be far more cost efficient (smaller footprint, much lower staffing requirements) than running a convenience store.
[+] [-] typeliftr|6 years ago|reply
[+] [-] tokyoHacker|6 years ago|reply
[+] [-] SenHeng|6 years ago|reply
Lawson seems pretty fine being on their own.
[+] [-] fnord77|6 years ago|reply
how is this even possible? That would be almost 17 hours a day, 7 days a week for a 30-day month.
[+] [-] Mikeb85|6 years ago|reply
[+] [-] vkou|6 years ago|reply
> One Monday night in late March, only 10 customers came to the man’s store in the three hours before dawn, and the sales during that time were a little more than ¥6,000. The store will be in the red if he hired someone for night shifts.
Smart management would close the store during those hours. Of course, the franchise doesn't care for smart management - when the operator eats the loss.
[+] [-] yskchu|6 years ago|reply
It's mentioned in the article actually, in the later section on Mitoshi Matsumoto; he closed early and made more $$$.
[+] [-] microcolonel|6 years ago|reply
[+] [-] ilaksh|6 years ago|reply
[+] [-] bkor|6 years ago|reply
It seems they like the owner exhausted so they cannot do the things which makes sense. E.g. to sell the food which is close to the expiry date instead of throwing it out. Yet another example from the article.