Raw Japan

Slices of Japanese business, politics and life

Tempest in a bento box

June 24, 2009

The shelves of Japanese convenience stores are filled with neatly packed “bento” box meals. But ever wonder where they go when they reach their “sell-by” date? You should, because Japan chucks away a staggering 19 million tonnes of food a year – more than three times the amount of world food aid at 6 million tonnes.

The issue of food thrown away at “kombini”, or convenience store, recently grabbed the headlines here. Strict health laws mean many unsold items must be thrown out at the end of the day, and it’s each franchise store — not the store chain itself – that bears the cost of this waste. In all, about 70 percent of the leftovers from the food industry are recycled into animal feed and fertilizers, and much of the rest quietly rots in land-fill.  

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To minimise their losses from all this waste, some Seven-Eleven Japan stores have been trying to cut prices on items nearing the end of their shelf-life, apparently against the company’s wishes. It sounds like a common-sense solution, but it has lifted the lid on quite a scandal in the kombini world, which has so far largely avoided cut-throat price competition as shoppers allow for the price gaps compared with supermarkets in return for the convenient locations and longer operating hours of the stores. 

And what was the result of the discount attempt? Japan’s anti-monopoly watchdog said Seven-Eleven had illegally pressured its franchise stores not to cut the prices of bento box meals and other food by implying it would cut its contracts with stores not complying. The Fair Trade Commission also ordered Japan’s largest convenience store chain, a unit of listed Seven & I Holdings, to halt such practices.

The FTC order could mean price battles will grow between different chains and even among different franchises within the same chain. Such concerns sent shares of convenience stores tumbling earlier this week. Seven-Eleven said it may appeal the FTC’s findings, but a day later it said it would pay for 15 percent of the cost of wasted food from its franchise stores.

Photo credit: REUTERS/Stringer

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