Profile of the (surprisingly lucrative) university co-op business in Japan

When I did a year-long exchange at Ritsumeikan University in Kyoto, one of the more interesting entities on campus was the co-op that ran cafeterias and a general merchandise store. Prices were reasonable, the food was excellent, and service was comparatively decent. The store even had an entertaining message board where students could ask the staff questions on any random topic, similar to the Japanese blog “Shiraishi of the Campus Co-op.” Like me, many foreign students probably leave Japan with fond memories of their university cafeteria and the friendly middle-aged ladies who served them.

I thought I knew all I needed to know about the co-op system, but the always informative Shukan Toyo Keizai’s profile of the university co-op system taught me a thing or two.

Here are some key facts:

  • University co-ops are non-profit institutions operated and funded by student members. Around 30% of Japan’s 762 four-year universities (around 230 228 to be exact) have a co-op on campus, which will likely run at least one cafeteria, merchandise shop, and bookstore each. 40% of all university students (1.3 million) are members. At universities that have co-ops, membership is around 95%. Students pay between Y10,000-30,000 to join when they enter university, which is returned without interest once they graduate or drop out.
  • All such co-ops are organized under the umbrella of the National Federation of University Co-operative Associations in Japan, formed in 1958. While the first university co-op was formed in Kyoto’s Doshisha University in 1898, they didn’t really start to take off until after World War II, as universities set up co-ops to help ensure steady food supplies as Japan’s economy got back on its feet, similar to neighborhood co-ops (they are regulated by the same law). The federation’s website notes that co-ops offer a wide range of goods and services, among them “food, clothing, housing, books, stationery and PCs…arranging and subcontracting for tourism, Student Mutual Benefit [a type of insurance plan], language training programs, courses for applicants for public employee and computer training programs.”
  • Co-ops are a serious business – in 2008 the federation counted revenue of Y207.5 billion. Considering there are only co-ops on 230 228 campuses, it’s nothing short of amazing their revenue compares with convenience store chain am/pm (Y195.5 billion in FY08, 1,129 stores) and Tokyu department stores (232.3 billion in FY08, scattered stores in major cities). The article explains the universities benefit from a captive customer base of students on campus and virtually no other on-campus competitors (though that has changed slightly following some deregulation in 2004).
  • About a quarter of all sales are recorded in March and April ahead of the start of the academic year. However, in those two months the co-ops typically sell around 60,000 PCs. Sales in 2008 break down as follows: 15% from cafeterias, 19.9% from bookstores, and 65.1% from merchandise stores (in the merchandise category, 18.6% comes from hardware & software vs. 11.5% from food). If you are the employer/owner of those businesses, perhaps learning and then teaching the importance of being proactive in the workplace can buff those numbers a bit.
  • Gross margin (revenue minus cost of goods sold as a percent of total revenue) is roughly 20% overall and 50-55% in the cafeteria segment. That basically means that for every 100 yen in sales, 20 yen is profit before labor/administration, financing, and tax costs.
  • One benefit of being a student association is the university charges virtually no rent. This allows them to keep cafeteria prices low and charge the same for electronics as big-box retailers. The co-ops also have considerable bargaining power as procurement is all done through the national federation. That’s how the cafeterias can charge an average of Y380 per meal.
  • Another advantage of the co-ops is service. One student interviewed from the article bought a PC at the co-op because he liked getting advice from a fellow student.
  • One disadvantage of having your business limited to college campuses is the limited number of business days. Vacations slash the total number of business days to around 250-300, and students only show up for class on about 150-170 days a year.
  • In 2004, Japan’s national universities were stripped of their status as arms of the government and reorganized as corporate entities. This meant they gained a freer hand to get creative in running their campuses, and one such initiative has been to open convenience stores on campus in direct competition with the co-ops. Already, 40 co-ops are reported to be competing with on-campus kombini.
  • Co-ops have responded to this competition with initiatives of their own, for example opening chain stores inside cafeteria areas and selling pre-paid meal plans to students (something typical at US universities).
  • The population of 18-year-olds in Japan (an indicator of the size of the co-ops’ target demographic) expected to hold steady at 12 million in 2009 but then fall steadily into the foreseeable future. With this declining customer base, the author speculates there will be closer cooperation with universities and co-ops in the future. Already there are examples of a co-op collaborating with Yamanashi University to offer Yamanashi wine on campus.

Facts on Japanese libraries

(Updated and corrected)

If you’ve never been to one of Japan’s public libraries, I suggest you check one out. While they vary in quality from place to place, in my experience they’ve been great resources of free books and periodicals (especially magazines). The users tend to be surly older men there to get a free newspaper, kids playing with the picture books, and serious students studying for exams. While they have some odd rules (no late fees, you can actually check out periodicals, and there are draconian photocopy limitations), all in all I love them.

So that’s why I was so happy to see that Japan’s ministry of education has some numbers on Japan’s network of public libraries as part of a survey taken every three years of “social education” institutions like libraries, civic centers, and museums.

Some facts:

  • At the time of the survey, taken over 2007 and 2008, there were 3,165 public libraries in Japan, or one for every 40,349 people. In the US, there are an estimated 122,356, one for every 2,485 people. That compares to 42,204 convenience stores and 13,000 pachinko parlors. The number is up from 2,396 in 1995. (Correction: The US number included public school libraries, whereas the Japanese numbers did not. The corresponding US number is 16,604, or one for every 18,312 people.)
  • Japanese people borrowed over 600 million books in 2007.
  • There are a total of 34.03 million cardholders (26.7% of the population), who borrowed an average of 19 books apiece. Elementary school-age cardholders were more avid readers, borrowing 35.9 books each. The cardholder population is actually down from 36.9 million in 1999 but up from a sharp fall to 26.4 million in 1998.
  • However, today’s cardholders visit the library 5 times a year, vs. just 3 times in 1995.
  • Though there are only 14,981 employed librarians or assistant librarians in Japan (including those working at privately run collections), it’s estimated more than 200,000 people have passed the official librarian exam. In the US, there were 150,000 employed librarians in 2008. That’s 4.7 librarians or assistants for each library vs. just 1.2 per library in the US. I am not exactly sure what to make of this difference, but maybe it has something to do with the relatively higher qualifications needed to become a qualified librarian in the US (a masters degree in library science) vs. Japan (an undergrad degree in library science or a degree in any field plus some extra training).
  • By far the biggest library in Japan is the National Diet Library in Tokyo with a collection of 34.7 million books, compared to the US Library of Congress’s 141 million. I guess if the Diet doesn’t actually have to make any decisions, its members don’t need to do as much background research!

While I won’t get into it now, Wikipedia has some info on the history of libraries in Japan if you’re interested.

(link thanks to J-Cast)

Pills for old men or young women?

The US healthcare reform bill that recently passed the House only did so after a controversial amendment was inserted banning any insurance plan which pays for abortion from accepting any federal subsidies, a clause that will probably eliminate abortion from most or all health plans if it goes into law. One reader at TPM had the following thought experiment:

What would happen if a few female members of the House put in (or merely proposed) an amendment to the health care bill which stated that men would be barred BY LAW from purchasing health insurance which covered Viagra, all hair-growth medications or procedures or transplants, etc.?

This thought experiment reminded me of the well known case of the birth control in Japan. Actually, I say well known, but when I checked to confirm the dates, the details were rather more complex than the simplistic version of the story that I had thought I knew, in which the pill was simply never legalized in Japan until a decade ago.

The first birth control pill was approved for that use by the United States FDA in 1960, but was rarely used in Japan until recently. The pill was not approved at all in Japan until 1972, but this was the high-dose formulation that was already being replaced in other countries with a low-dose version of the drug due to safety reasons. Because the safer, low-dose pill was never approved in Japan, oral contraceptives remained little used. Even after the original high-dose formulation was removed from the market in the US in 1988, the low-dose pill remained off the market in Japan.

This changed in 1999, after Viagra was fast-tracked for approval. Viagra first went on sale in the US in March 1998, and only a few months later was already being studied for approval in Japan, where it went on sale in March 1999 – only one year after the US. Feminists complained about a double standard that allowed a drug whose primary purpose is allowing recreational sex for old men to be approved almost immediately, while the safe low-dose birth control pill was still not approved after four decades. At the time, Yoshiaki Kumamoto, president of the Japan Foundation of Sexual Health Medicine, was quoted as saying that viagra was approved so quickly because old men in parliament “want to have that drug.”

The modern pill was finally approved in September of 1999, although women taking it are required to have pelvic exams four times a year, as opposed to once or twice in most countries, and there is still a widely held association with the dangerous side effects of the old formulation. According to a late 2006 study, only 1.8% of Japanese women were using the pill for their birth control needs. This compares with, according to UN figures for the year 2005, 7.5% of women worldwide, and 15.9% of women in developed countries.

Scratch not lest ye be scratched

Awesome site that photoshops those creepy Japanese Christian signs to change the word “God” to “cat.” Pure gold:

c7e8aa52

The kingdom of Cat is upon us.

b2040b06

Cat will judge adultery and fornication.

You see, erasing part of the word “God” (神) in Japanese will give you the word for “cat” (ネコ).

Thanks to Marxy for the link!

History on the march – Lindsay Hawker’s alleged murderer arrested

The police have finally arrested Tatsuya Ichihashi for the grisly murder of Nova teacher Lindsay Ann Hawker. You can find the details from any number of sources. I am very glad the police followed through and finally brought him to justice after initially letting him get away. He was on the run for around two and a half years.

This is a minute detail, but Ichihashi’s arrest means that from now on there will be no more wanted posters with Ichihashi’s face. Ever since I arrived in Japan around two years ago his face has been plastered just about everywhere. In fact, the murder occurred just a month before I touched down. Now I’ll miss not seeing him at every police box. It’s not that I was fond of him – I will just instinctively feel a sense of loss. Today he was there, and at some point in the next few days he’ll be gone from everywhere but the TV. And all this time, he didn’t even look like that anymore because of the plastic surgery!

It’s the same with the Tokyo Olympics 2016 signs. From the time I arrived here (as far as I can remember) until just a couple months ago they were all over the place – but now that the games were awarded to Rio they are gone, too.

The Universalistic Elements of Japan’s Criminal Code

I just arrived in the United States, flying from Narita on All Nippon Airways (ANA). In the bathroom on the airplane, I noticed this prominent warning sticker on the mirror.

smoke detector warning ANA

At the time I read this, we were flying over the United States, towards a city in the United States, and there was no reference to punishment under US law. I wondered if some people might read that and think that, under the circumstances, who cares? Japan can’t prosecute me here!

Actually, they can — just check out Article 1 of Japan’s Criminal Code:

Article 1 (Domestic Crime)
1. This law applies to all persons who commit crimes inside Japan.
2. The previous section shall also apply to all persons who commit crimes on Japanese boats and airplanes outside Japan.

There you have it — this is the general general rule for the application of criminal statutes in Japan. Also, although not specifically stated here, the criminal laws also apply at Japanese embassies and consulates overseas.

The first four articles of the Criminal Code deal with the different types of applicability. Moving on to the remaining provisions:
* Article 2 concerns acts covered by Japan’s criminal law no matter who commits them, anywhere outside Japan, and include aiding and abetting enemies of the state, the various classifications of treason, and conterfeiting currency, securities, credit cards, public documents, and seals.
* Article 3 concerns acts covered by Japan’s criminal law if carried out by citizens overseas, and include arson, forgery of private documents, rape, bigamy, murder, felony murder, abandonment of a child, kidnapping, human trafficking, robbery, criminal defamation, and larceny. There’s a reason not to natualize!
* Article 3, 2 (第3条の2) covers the applicability of Japanese criminal law to crimes committed against Japanese citizens outside Japan, and includes rape, murder, felony murder, kidnapping, human trafficking, robbery, and similar crimes against the life and body (but not property) of the Japanese citizen.
* Article 4 covers crimes that are committed by public servants overseas, and includes the crime of aiding a fugitives by a responsible guardian (i.e. a cop helping a prisoner escape), forging public documents, recieving bribes, felony murder (occuring while carrying out public duties), and violent abuse committed by a special public servant (i.e. being beaten by a cop).
* Article 4, 2 (第4条の2) covers crimes where Japanese criminal law applies under treaty.

SIDENOTE: Article 39 of Japan’s Constitution prohibits double jeapardy, i.e. being punished twice for the same crime. However, that only applies to the same court punishing someone for the same crime — so for example, a Japanese citizen could serve time in a US prison for, say, arson — and return to Japan only to be prosecuted again for the same crime.

Reconsidering the Reconsideration of Futenma

Comments closed, please join the fray at ComingAnarchy.

The Futenma US Marine Airbase is inconveniently situated in the center of Ginowan City in southern Okinawa. The location is awful, a relic of Japan’s imperial military infrastructure that has military aircraft constantly landing and taking off in a dense urban environment, and the locals want it gone. In the mid-1990s the Liberal Democratic Party (LDP) and the US started to hammer out a relocation plan, and fifteen years later, they finally agreed to move the base to an offshore facility in northern Okinawa.

futenmaJapan’s new Prime Minister Yukio Hatoyama of the Democratic Party of Japan (DPJ) wants to uphold an election pledge to “move away from U.S. dependency to a more equal alliance” — which means reconsidering the Futenma relocation. Hatayama wants to act boldly on this matter, and has decided that instead the base should be moved to… um… somewhere else. Well, maybe — he hasn’t decided yet. Hatoyama’s inability to envision an alternative plan, or even how to approach an alternative plan, combined with the DPJ’s replacement of bureaucrats with elected politicians in the public policy debate, has given the more ambitious members of the cabinet the opportunity to engage in public policy freestyling. Transportation Minister Maehara wants to scrap the plan and go back to square one, Defense Minister Kitazawa wants to keep the plan as it is, and Foreign Minister Okada wants to relocate the base -elsewhere in Japan- -to Guam- elsewhere inside Okinawa. The DPJ vision changes almost daily, and US officials, long numb to Japan’s tedious foot-dragging, are now getting pissed — most noticeably US Defense Secretary Gates, who visited Japan last month and called the reconsideration of the plan “immensely complicated and counterproductive.” But what else should we have expected from these guys? As I warned earlier this year, the DPJ are amateurs suffering cognitive dissonance when it comes to foreign policy, and the longer this abstract debate drags out, US officials will only become more frustrated. And this threatens the stability of the US-Japan relationship.

Most of the “Japan hands” in the blogosphere sympathize with the DPJ. Tobias Harris of Observing Japan says the US needs to wake up to the reality of this new alliance. Michael Cucek at Shisaku has a comprehensive and pessimistic analysis of Obama’s upcoming visit to Tokyo in the broader context of US-Japan relations, which concisely dissects the unique challenge that now face this critical bilateral relationship. To abridge Michael’s key section:

In international law there is the concept of “odious debt” — of national debts incurred by an oppressive regime that a successor regime has the right to refuse to pay. Given the decades the LDP clung to power, many in the present coalition government consider a whole host of Japan’s obligations to be “odious” that they should review and possibly repudiate.

The agreement to transfer Marine Corps elements from the Futenma Airbase to Henoko is the ultimate expression of an odious obligation. It was an LDP solution to an LDP problem: keep American bases off the main islands (even though the amphibious ready unit, the ships the Marines are supposed to ride on, are homeported in Sasebo [in Nagasaki] and the Marine fighter jets in housed at Iwakuni [in Yamaguchi]); keep the Okinawans down and quiet; and keep visiting Americans alternately enchanted and frustrated by disingenuous reports of progress toward the goal, which somehow had to along the way destroy vital dugong habitat. As the Prime Minister and others in the DPJ point out, not even 12 years of LDP governments could bring the Futenma transfer to fruition. That he and his party should be condemned for not imposing an arrangement they oppose on a population that does not want it baffles them. That the United States government continues to insist that they do so exasperates them.

Readers won’t be surprised that I find myself defending the LDP decisions and take issue with the description above, a position that matches that of most of Okinawa’s elected leaders. Let’s look at some key arguments for the Futenma relocation plan:

* The residents of Nago, where the base is to be relocated, support the plan. Mayor Shimabukuro recently came out to agree with Gates, saying the US Defense Secretary is right for being frustrated with the central government’s indecision. Shimabukuro was elected on a platform built on the status quo set by his predecessor, which emphasizes economic growth over everything else, and he won more votes than both of his anti-base opponents combined.

* It’s not just Nago — all twelve mayors of northern Okinawa have publicly accepted the new relocation plan. The DPJ’s waffling has been so unsettling to the locals that the mayor of Kadena is teaming up with the US forces to oppose relocating the relocation to Kadena, promoted by some members of the Hatoyama cabinet as the best alternative, and where one US facility complex already exists.

* Okinawa Governor Nakaima accepts that US bases must stay in Okinawa. Nakaima has a particular knack for balancing the concerns about US bases with the need for the economic benefits that come with it, and has become relatively popular in Okinawa by refusing to side with either faction and instead saves his ire for the national government — all while saying that, in an ideal world, he would prefer bases be relocated outside Okinawa. He criticized the Defense Minsitry under the LDP for “lacking delicacy,” and most recently, didn’t mince words regarding the DPJ’s scattershot public debate on the topic, saying “Okinawa is not the central government’s rock garden.”

* The biggest opponent of the relocation is Mayor Iha of Ginowan, and Ginowan is the center of all the protests — yet this is the municipality that would benefit from the relocation. It really doesn’t make sense — if the mayor and the residents don’t want the base in the city, why are they opposed to moving (most of it) out of the city? As it happens, Mayor Iha is the only elected mayor in Okinawa who vocally wants US forces not just out of Okinawa, but all of Japan. Of course he’s welcome to that opinion, but this is a view far removed from the mainstream public debate in Japan, making him unusual person to be quoted and referenced, unless the Hatoyama administration wants US forces out of Japan altogether (which it doesn’t).

* Construction on the project has already commenced. To a certain extent this follows a similar point I made when reviewing the Yamba Dam. Some dismiss it as the “sunk cost fallacy.” But I disagree, and the DPJ Defense Minsiter Kitazawa has spoken on this point in expressing doubts on changing the relocation plan.

Those are the practical and domestic political reasons for wanting the relocation. But beyond this, let’s review the relocation from the perspective of Japan’s national interest.

For more than half a century, the LDP management of the Japan-US relationship was, frankly, brilliant. Japan recieved dirt cheap defense services by letting the US base on Japan’s soil, yet managed to keep most American servicemen out of major urban areas (unlike Korea, where US bases are inside Seoul’s urban boundaries). Having defense outsourced to America and situated within the American economic sphere, Japan was able to concentrate on economic development and quickly grew to be the world’s second largest economy.

What has Japan done for the United States and the world in exchange for this discounted security? It makes minimum, token contributions to global security, bankrolls a few international development projects, and keeps proactive and material contributions at the bare minimum — or as Shisaku described Futenma, Japan kept “visiting Americans alternately enchanted and frustrated by disingenuous reports of progress.” That sentiment could be applied to much of Washington’s attitudes towards Japan when it comes to becoming more involved in world affairs.

Yet Washington has long tolerated Japan’s indifference to the world because under the LDP, it regularly granted the US unconditional support. Whether it be at the UN, or in supporting the US on tough foreign policy decisions, or in keeping bases available, Japan has long been a solid ally. That means a lot more than you might think. US bases have been kicked out of France, the Philippines, Saudi Arabia, Iceland, and elsewhere, and suffered various woes with regard to fierce public opposition in places such as South Korea and much of Europe. Save for the student protests of the 1960s, Japan has been remarkably reliable — if just in spirit. Or to quote a recent article in the Washington Post, “A senior State Department official said the United States had ‘grown comfortable’ thinking about Japan as a constant in U.S. relations in Asia.”

The DPJ is doing more than trying to break the Futenma deal — it’s breaking the unspoken understanding behind the entire alliance. By pushing for a more “equal” Japan-US relationship (whatever that means), and frustrating the Pentagon on its key issues (such as Futenma), the DPJ risks alienating it’s allies in Washington. And therein lies the danger for Japan’s national interest. America has been calling on Japan to “pull its weight” in contributing to global security for years, and we may be approaching the last straw. The Futenma controversy is compounded by the DPJ pushing to cancel it’s only proactive involvement in the war on terror by ending the refueling mission for US ships in the Indian Ocean.

But Hatoyama has got to accept the fact that neither he nor the Japanese people want an equal relationship with the United States — at least not if they actually saw what it would look like. Japan does not want to have to pay for US bases by sending Japanese SDF forces to Iraq and Afghanistan. They do not want to be diplomatically fending for themselves while repeating complaints about the North Korean abductions and Russia arresting its fisherman. They do not want to push themselves out of the US defensive perimeter, or even in the away direction from the US defensive perimeter. Of course, this may ultimately be good for US national interest, because this is a better time than any to demand Japan to step up to the plate and take a lead in the world. But Japan doesn’t really want that, yet that is where we are going if Hatoyama pursues the “equal alliance” mantra and continues to piss off the US just because it feels good.

Comments closed, please join the fray at ComingAnarchy.

Stuff I want to eat: Frijoles, a Chipotle knockoff in Azabu Juban

menu_buritto001

When I lived in Washington, DC, one of my favorite places to eat was Chipotle, the formerly McDonald’s-owned seller of giant burritos. The combination of spicy salsa, sour cream, guacamole, and seared meat all wrapped in an overstuffed tortilla made for a reasonably priced explosion of flavor, guaranteed every time.

Accordingly, a complete lack of anything comparable in Japan (or any decent Mexican food, for that matter) has been a source of considerable homesickness for me.

Until now.

Joe has pointed me to Frijoles, a restaurant in Azabu Juban with a menu essentially identical to Chipotle. I have not eaten there yet, but it has so far received some positive word of mouth. I’ll be sure to report once I’ve had the chance to try it out.