Can ‘Late-Night Pricing’ Keep the 24-Hour Convenience Store Alive?

Convenience stores in Asia should look to the taxi industry to make their 24/7 operating hours profitable.

The News Lens
Date: 2019/03/15
By: Xiaochen Su

Credit: H.T. Yu / Flickr

Last month, Japanese media reported extensively on the conflict between major convenience chain 7-Eleven and one of its franchisees. 7-Eleven accused the franchisee of shutting down his shop at night without permission and asked him to pay a “breach of contract” fee amounting to 17 million Japanese yen (US$153,000). The franchisee complained that he was unable to hire workers for late-night shifts and, as his wife had died a few months earlier, he has been overworking himself just to keep the shop open 24 hours.

The underlying problem, as discussed in the article, is a significant shortage of labor faced by convenience store owners. With prices and wages set by the headquarters, franchisees, especially in more remote areas, are having a hard time recruiting people to work the undesirable graveyard shifts. The struggle of the franchisee in the 7-Eleven case shows that labor shortage is threatening one of the defining characteristics of the convenience store: The fact that it is open 24/7.

The issue is certainly not one unique to Japan, but relevant throughout Asia. 7-Eleven and other open-all-night convenience store chains, as well as their local equivalents, can be found in Taiwan, South Korea, China, as well as many Southeast Asian countries. The ubiquity of these convenience stores has led to the emergence of social norms for making small purchases late at night. Indeed, as the president of 7-Eleven made very clear, keeping stores open late at night is very important for the overall sales of the stores. This is true in all countries where convenience stores remain popular.

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