24-Hour Stores May Decrease
August 9, 2019
24-hour convenience stores are very common in Japan. People can buy food, commodities, printing out documents, withdraw cash, send a parcel, and so on at any time of the day, even at midnight. These days, convenience stores play a considerably important role for people. However, the situation of convenience store is about to change. A number of convenience store’s owners are getting to hindered by having to open the store all day. Recently, some major convenience store companies have offered to allow stores to end their 24-hour operations.
Current Situation of Convenience Store
There are thousands of convenience store in Japan. The number of convenience stores are increasing every year. According to the Japan Franchise Association, there are 57,818 convenience stores throughout the country (see Figure 1). Almost all convenience stores are opened 24 hours every day, regardless of weekends or holidays. The role of a convenience store is not only providing many services and selling products, but also being the place of refuge when sudden disaster occurrs. In addition, convenience store take an important role to protect the people from danger.
Sales System of Convenience Store
Sales of convenience stores are unique. The difference between supermarkets and convenience stores is whether the head office is directly operating the store or not. Three Major convenience store companies, Seven-Eleven Japan Co., Family Mart Co. and Lawson Inc., have many stores; some of which are directly managed by the head office but most of which are franchise operations. Also, there is a term called “conbinikaikei” which when a franchise owner of a convenience store has to pay “royalty” to the head office. Thus, the profit from the sales that franchise owners make is much lower than what the head office gains.
The Problems hat Convenience Store Have
Convenience stores are becoming more and more convenient. These days people can do almost anything at a convenience store. On the other hand, for the owners, the operation of services are becoming more complex because of the great amount of services they have to provide on top of the fact that their stores are open everyday, so they do not have holidays. In other words, owners and employees of convenience stores cannot take a break from work. In fact, many franchise stores are faced with great difficulty in operating. In reality, it is hard to secure part-time workers. In addition, labor costs are rising these days.
Although the number of customers during the night are decreasing, owners still have to keep their stores open. In some cases, the cost of labor is actually higher than the amount of sales during night time operations. According to a news segment, one convenience store stopped their 24-hour open policy and then got served a penalty by the head office of seven-eleven (17million yen) to the store. This news made an impact to many people.
24-Hour Store Is Needed
On the other hand, convenience store companies do not want franchises to close their store during the night. Having a store be open for 24-hour is the agreement the owners signed up for when they made a contract. Furthermore, closing the store at night will decrease the profit of the head so the head office does not want franchise owners to quit their 24 hour open policies.
The System of The Convenience Store May Change
From the above, 24-hour open convenience store is very convenient and important for people, but for the owner, it is a difficult practice to uphold. To manage a good convenience store, both the head office and the owner has to communicate with each other. In fact, the head office should not stick to their rigid rules and should instead, better understand where these franchise owners are coming from. If both sides could come to an agreement, the relationship between the head offices and franchise owners might also improve as well.