Editorials

Who's sustaining the convenient 24-hour service?

A dispute between the owner of a 7-Eleven in Osaka Prefecture and the operator of the nation’s largest convenience store chain has shed light on questions over the sustainability of convenience stores’ round-the-clock service — which is widely taken for granted by consumers — as many of the stores face growing difficulties securing enough manpower to keep running amid the tightening labor shortage. Convenience store chain operators say their shops’ 24-hour service has been established as social infrastructure supported by consumers. But the companies — and consumers — should also give thought to who is sustaining this convenience and at what cost.

At the beginning of February, the owner of a family-run 7-Eleven store in Higashiosaka decided to stay open 19 hours a day instead of 24 — from 6 a.m. to 1 a.m. — as a staff shortage made it impossible to keep the doors open around the clock. The owner says he’s only been able to take three days off since his wife died last May, and he hasn’t been able to hire new staff since a large number of part-timers quit last April. But then the owner was reportedly told by Seven-Eleven Japan Co. that it would terminate his franchise contract and seek ¥17 million in penalties unless his shop went back to staying open 24 hours a day.

According to Seven-Eleven Japan, it is stipulated in its franchise contracts with store owners that stores will in principle be open 24 hours except for those located inside facilities such as train stations and hospitals. The chain operator reportedly held talks with the owner and offered to dispatch staff so that the store can resume 24-hour service, but the owner declined because he thought the manpower help was not being offered on a permanent basis. The owner has told the media that he wants the chain operator to allow each shop to decide their business hours in accordance with their individual situations.

Seven-Eleven Japan started 24-hour operation of its stores in 1975 — a year after its first store opened in Tokyo. Round-the-clock service became a convenience store industry standard as other chain operators followed suit, and consumers today take it for granted that convenience stores are open 24 hours all year round. Major chain operators say it’s difficult to change the 24-hour service — barring exceptional cases and trials of reduced-hour operation — since the convenience and the sense of security imparted by the fact that those stores are always open have been established as social infrastructure and endorsed by consumers.

The question is whether the social infrastructure of convenience is sustainable when many of the stores are confronted by the manpower shortage that is accelerating with the rapid aging and decline of the nation’s population. Stores’ difficulty in securing enough staff does not appear to be improving even as hourly wages for part-time workers in big metropolitan areas are rising to record levels.

Other sectors have begun to curtail their service hours amid the manpower shortage. Family restaurants and fast-food chains, which also face staffing problems, have shortened their operating hours — a decision that also is based on a decline in the number of late-night customers due to changes in consumer lifestyles. Leading parcel delivery firm Yamato Transport Co. halted its service of time-designated deliveries during certain hours of the afternoon in order to give its delivery staff — whose workload surged with the boom in online shopping and exposed the chronic manpower shortage in the trucking industry — time for a lunch break.

The convenience store industry — which symbolizes 24-hour service for consumers — seems to have unique reasons for why the stores’ round-the-clock hours don’t change. In a typical franchise contract, the amount in royalties that the franchisees pay to the chain operator is directly linked to sales at each store, and reducing business hours results in less revenue for the chain operator. The chain operators also say that the 24-hour operation is needed so staff can engage in processing work when the store is not so busy to ensure enough stock for peak sales hours.

It appears, however, that the owner of the 7-Eleven who is involved in the dispute with the chain operator is far from alone and there are many other convenience store owners facing similar problems with staffing. The nation’s manpower shortage, which looks set to grow increasingly critical in line with the demographic trend, casts doubts on the sustainability of a business model based on 24-hour service. Consumers should also consider whether they would continue to expect 24-hour service if it is resulting in an excessive burden for convenience store proprietors and their staff.