National

Seven-Eleven Japan's termination of contract seen as move to expel Higashiosaka owner

Kyodo, JIJI, Staff Report

Seven-Eleven Japan Co. has decided to cancel its contract with a franchise store owner in Higashiosaka, Osaka Prefecture, who made headlines earlier this year for halting round-the-clock operations, due to severe labor shortages, without permission from the franchisor.

The operator of 7-Eleven convenience stores in Japan cited a higher number of customer complaints as the reason, but the move is perceived as an effort to eliminate the outspoken owner who not only called for shorter hours but also demanded that the store be allowed to close on New Year’s Day and Sundays.

The store owner, Mitoshi Matsumoto, 58, is still planning to close the store Tuesday and Wednesday and resume operations from Thursday despite the contract cancellation.

Matsumoto met with Seven-Eleven officials on Sunday to demand the contract remain in place after Seven-Eleven warned on Dec. 20 that the contract would be scrapped unless an improvement was made to deal with customer complaints.

The negotiations ended in failure after nearly three hours of talks. Seven-Eleven Japan cited a “damaged relationship of mutual trust” as the reason for contract cancellation, and did not mention Matsumoto’s request for shorter hours or to close on New Year’s Day as part of its reasoning.

But some other store owners have said they see the cancellation as an attempt to stifle calls for stores to be allowed to close on New Year’s Day.

Matsumoto is considering filing a lawsuit against the company early next year to ensure his status as a franchise owner remains intact. He said he would refuse to hand over operation of the store and would reopen for business Thursday, although he won’t be able to order merchandise or use the cash register, among other tasks, after the store is closed at 11 p.m. on Dec. 30.

“This is how a franchise store is forced out of business if it is in dispute with a chain. I will continue to fight,” Matsumoto said.

Meanwhile, Seven-Eleven may also file a lawsuit against Matsumoto and demand that the operations at the store are handed over if he continues to do business after the franchise contract is canceled, a lawyer for Matsumoto said. The company declined to comment, adding that the matter would now be left to the lawyers for the two sides.

In February, Matsumoto halted late-night and early-morning operations in violation of a 24-hour policy that was common in the convenience store industry then, saying that he had taken only three days off during the preceding eight months.

The incident drew wide attention as more franchise store operators expressed concern about overwork amid a deepening labor crunch, and the government began conducting a survey on labor conditions in the convenience store industry.

The Fair Trade Commission is also considering introducing measures to prevent convenience store operators from taking punitive measures against store owners who demand shorter hours.

With the public on his side, Matsumoto escalated his demands. In August he called for his store to be closed on Sundays, and then announced in October that his store would be closed on New Year’s Day.

Matsumoto’s move has led Seven-Eleven Japan to take a softer stance regarding closures, with the franchisor recently starting to allow stores to halt operations late at night or early in the morning after the company recognized that it had failed to respond to societal changes.

Among other major Japanese convenience store operators, FamilyMart Co. has also decided to allow shorter operating hours. Lawson Inc. does not require franchise owners to open their stores around the clock.

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