Japan tells convenience stores to stop forcing 24-hr rule on franchises

[TOKYO] Japanese anti-monopoly regulators on Wednesday told convenience store chains to stop forcing franchises to stay open 24 hours a day, after complaints from franchise owners struggling to find late-night staff and make a profit during quiet business hours.

"We indicated that it could be a problem under the anti-monopoly laws. We requested immediate improvements and asked that improvements be reported to us," the Fair Trade Commission said in a report.

The directive by the regulator, based on a survey of more than 12,000 convenience stores and 8,423 franchise owners, was aimed at Japan's eight major convenience store operators, including Seven & i Holdings' 7-Eleven chain and Lawson.

The issue of convenience stores' hours became a hot topic last year after franchise owners, struggling with the tightest labour market in more than 40 years, launched a campaign to change their contracts with the operators.

Stories of owners forced to work amid massive snowstorms or in the wake of a family death attracted national attention, putting operators under pressure to loosen franchise contracts and allow for shortened hours.

Japanese convenience stores began expanding in the 1970s as their 24-hour accessibility proved a perfect match with the country's dense population and late-night work culture.

But many analysts say the industry now looks saturated, in light of Japan's ageing population, slow economic growth and new competitors such as Amazon Prime.

REUTERS