• Kyodo

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Seven-Eleven Japan Co. said Thursday the convenience store operator will replace its president after its longtime 24-hour operating policy caused controversy recently amid a labor crunch that is straining the retail industry.

“When it comes to operating hours, I’d like to consider a flexible response that would suit each outlet,” given that the business environment for every store varies greatly, vice president Fumihiko Nagamatsu, who will be promoted to the top post, effective Monday, told a news conference in Tokyo.

The revamp of Seven-Eleven’s management could lead to a major turning point for the country’s convenience store industry, which has been increasingly relying on foreign part-time workers to fill shifts as many franchise owners have been struggling to secure labor amid Japan’s graying population.

At present, 96 stores, accounting for 0.5 percent of its franchise outlets nationwide, are hoping to reduce business hours, according to the company.

Seven & I Holdings Co., the parent of Japan’s leading convenience store operator, said the current president, Kazuki Furuya, will become chairman without the right to represent the company.

“We are aware of the phenomenon in which information from the workplace was not shared smoothly with upper sections (in the company),” said Ryuichi Isaka, president of the parent, who attended the same news conference.

The reform comes with Seven-Eleven mired in controversy over its 24-hour operating policy after one of its franchise owners in Higashiosaka, Osaka Prefecture, cut the business hours at his store due to a labor shortage without approval from the franchise operator.

The owner, Mitoshi Matsumoto, was accused by the chain operator of violating his contract after he started closing his store overnight from Feb. 1.

Following the announcement of the management change, Matsumoto said that he does not have high expectations as the current president will stay on as chairman of the chain operator.

Since late March, Seven-Eleven has started trials of shorter opening hours in 10 stores that are directly operated by the company, while the industry ministry also asked operators of major convenience store chains in Japan to come up with measures to address growing discontent.

On Thursday, Seven & I Holdings reported a record group net profit of ¥203 billion ($1.8 billion) in the business year ending February, up 12.1 percent from the previous year, backed by robust sales of its overseas convenience stores.

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