Editorial
The 'convenience' of wasting 20 million tons of food a year
Seven-Eleven Japan Co. has been served a business improvement order from the Japan Fair Trade Commission (JFTC) for violating the Anti-Monopoly Law by preventing member stores from discounting food products. The commission judged that the company abused its superior position, and unfairly limited the discounted sale of products approaching their use-by dates, such as boxed lunches and rice balls.
In 2002, the JFTC banned restrictions on discounts based on its Anti-Monopoly Law in relation to franchise systems. Seven-Eleven had expressed the opinion that discounts didn't fit in with the model of convenience store operations, though it said it would leave the final decision up to member stores. However, the company asked stores to file reports or make inquiries with its headquarters when discounting products, and when they did the firm put pressure on them, such as hinting that it would cut off their contracts if they went ahead with discounts. Eventually, the stores had no option but to throw out unsold food, leading to the problem of large-scale food disposal.
While the Fair Trade Commission's recent order restricts freedom of management, it corrects the warped trading relationship that resulted in stores having to shoulder the cost price of products that they disposed of, on top of the disposal fee. This practice of making stores pay for discarded products has become customary practice throughout the industry, not just at Seven-Eleven. Now there is a possibility that the nation's convenience stores, numbering over 40,000, will start discounts similar to those in place at supermarkets and department stores. It is necessary to now take the opportunity to review the foundations of the business relationship that resulted in the headquarters getting all the profits.
Still, even if discounts are permitted, it's possible that the amount discarded will not significantly decrease. At some stores in the past, managers had bought items that were discounted to 1 yen, and included the items in their sales before discarding them -- a management improvement trick that allowed them to throw away the items for 1 yen rather than paying the cost price. It is feared that this practice will increase in the future. In Japan, nearly 20 million tons of food products are discarded each year -- more than three times the amount of world food aid. At convenience stores, the yearly amount is said to be in the range of 20 to 30 tons per store.
An issue closely linked to the massive amount of waste is the "convenience" of convenience stores, whose shelves are always lined with an abundance of new products.
"People's desire for us to supply new products 24 hours a day to match their lifestyle changes is resulting in waste," one worker in the industry said. This statement cannot be discarded simply as an excuse.
Businesses that unfairly constrict member stores are a problem, but one cannot imagine that a type of operation that wastes food will last. Convenience stores are making efforts such as recycling products into fodder for livestock, but considering reports that the population of the world's hungry has surged past 1 billion for the first time, the stores can hardly thrust their chests out in pride.
Of course companies have to rethink the system in which products are sent to stores several times a day to stimulate buying, but we may have also reached a time when consumers should review their thoughts that always having new products lined up on shelves is a welcome display of prosperity.
(Mainichi Japan) June 23, 2009