Archive for August, 2012

Package funeral services take the (financial) sting out of dying

Thursday, August 30th, 2012

Funeral hearse

Your ride’s here

The Tokyo metropolitan government  has launched a jumokuso service for individuals. Jumokuso means “tree funeral.” For a fee, a person can have his or her ashes buried at the foot of a tree planted in a special park in Kodaira. The financial advantage of this particular burial model is that the person pays only once. Most remains are interred in family graves located in graveyards that are managed by either local governments or religious entities. Graveyards require kanriryo (administration fees) in perpetuity.

In principle, a jumokuso customer will have his ashes mixed with other customers. It costs ¥134,000 for roughly cremated remains and ¥44,000 for remains that have already been reduced to ash (a more involved and thus more expensive process). Enough space for 10,700 people is being planned for the park, and the first group of 500 “plots” was recently sold via lottery. There were 8,169 applicants.

Obviously, many people are not attached to the traditional Japanese style of burial any more, and it probably has a lot to do with the traditional funerals that go with it, which can be extremely expensive. A recent Asahi Shimbun article described a woman in her 60s who was shocked when she received the bill for her husband’s funeral. The funeral service company had quoted ¥1.7 million for the whole thing, but the invoice came to ¥2.6 million.

Continue reading about the funeral business in Japan →

Poorer people passing up cancer screenings

Friday, August 24th, 2012

As long ago as the early 1980s the health ministry made it a priority to get more people to undergo cancer screenings in order to detect the disease at its earliest and easiest-to-treat stages. By 2009, the goal was to have 50 percent of the targeted adult population receive annual tests for five types of cancer — colon, stomach, breast, uterus, lung — by 2012. That goal was not reached, so they moved it back another five years, but since the overall screening rate at present is still somewhere between 20 and 30 percent, it doesn’t appear the ministry is going to achieve that goal either.

Cancer screening menu

I’ll take one from column A, and…: Cancer screening menu distributed by local government (click to enlarge).

According to an article in Asahi Shimbun, the main obstacle is income. A center for adult diseases in Osaka analyzed surveys carried out by the health ministry and found that the higher a person’s income is, the more likely he or she is to undergo cancer screenings. In fact, screening rates have a direct correlation to the public health insurance program a person is enrolled in. For instance, 48 percent of males enrolled in the Kyosai Kumiai insurance program receive colon cancer screenings. The rate drops to 38 percent for a man in the Kumiai Kenpo program, 27 percent for one in the Kyokai Kenpo program, 19 percent for those who use regular kokumin hoken (national insurance), and only 13 percent for people on public assistance, who get their insurance free.

Kyosai Kumiai members are national and local civil servants, including public school teachers, whose average income in 2009 was ¥2.36 million. Kumiai Kenpo is insurance for companies with 100 or more companies, of which the average member makes ¥1.95 million. Kyokai Kenpo is for companies with less than 100 employees. Their average salary is ¥1.39 million. Regular kokumin hoken is for part-timers, pensioners and the self-employed, who average ¥910,000 a year. People on welfare, of course, don’t have income.

Cancer checks are managed by local governments, who set up screenings at public facilities or cooperating hospitals and clinics, usually for limited periods at specific times of the year. The Osaka center found that part-timers, the self-employed and workers at smaller companies usually cannot take time off whenever they want to, and thus are less likely to be able to go to the facility when the screenings are being conducted, usually on weekdays. Moreover, they may not have the money to pay the nominal fees for the screenings, which can cost anywhere from a few hundred yen to ¥2,000 or more. Even though welfare recipients get free insurance, they have to pay these fees as well. And there’s a fee for each screening, so if you are a woman and undergo all five of the tests recommended it could cost as much as ¥10,000. And there are lots of tests for other types of cancer, each of which requires a fee.

Continue reading about cancer screening →

Vitamin drinks demonstrate their stamina in the market

Wednesday, August 15th, 2012

I feel better just looking at them

The marketing firm Fuji Keizai reports that the eiyo inryo (nutrition beverage) market is one of the few consumer sectors that has performed spectacularly in the past few years. Often referred to as “stamina drinks” since they are typically bought by salarymen who need a boost of energy to get them through the work day, eiyo inryo saw its market balloon from ¥114.8 billion in 2010 to ¥121.7 billion in 2011. And if sales so far this year are extrapolated, revenues should increase significantly again in fiscal 2012.

Stamina drinks usually come in two sizes: mini (less that 50ml) and regular (50-100ml). They also fall into two general categories: iyakuhin, meaning they are considered “medicinal” and thus can only be sold in drug stores; and shiteii yakuhin bugai, which do not contain controlled active ingredients and thus can be sold anywhere.

The most expensive of the four general types is mini iyakuhin, and one of the biggest sellers in this category is Yunker Koteieki, made by Sato Pharmaceutical, which retails normally for ¥840 for only 30 ml. It contains lots of herbs but also extract from the gall bladders of cows. The Yunker series also boasts the most expensive stamina drink: Yunker Star, which costs ¥4,078 for 50 ml. It contains a whopping 20 herbs. According to a Sato publicity person interviewed by the Asahi Shimbun, people buy Yunker Star “when they feel tired and know they have to do something important.”

Continue reading about energy drinks →

Summertime blues: no place to go or no money to spend?

Friday, August 10th, 2012

Last week, the research department of Meiji Yasuda Life Insurance released the results of its annual summer vacation survey. For the second year in a row, projected spending for summer vacation dropped from the previous year’s spending. On average, households say they plan to spend ¥82,974 this year, down from ¥84,848 last year. It is not the lowest amount on record, however. In 2008, households said they would spend ¥76,955, but that was the year after the subprime crisis and the Lehman Brothers “shock.” The next year, spending recovered but has been declining ever since.

What the roads won’t look like in the middle of August.

Yasuda hasn’t analyzed these findings, so it’s not entirely clear if the reason for the decline is lack of disposable income due to the ongoing recession or fear of spending any money because of an uncertain future. However, the amount of spending jumps considerably when children aren’t involved. Households consisting only of couples said they would spend on average ¥100,191, which is much more than it was last year. A relatively large number of couples say they will be traveling overseas.

In any case, the majority of all respondents said they would stick close to home this summer, 62 percent, to be precise. It’s the seventh year in a row that “staying at home” topped the list of answers to the question, “What do you plan to do?” Other answers (respondents can tick more than one) included “return to my home town” (39.4 percent), travel domestically (37.4 percent), and visit theme parks, public pools, camping sites, etc. Among the reasons given for staying at home this year, the most common was “to recover my strength,” followed by “it costs too much to travel.”

It’s unfortunate that Yasuda didn’t get even more detailed in this line of inquiry. For example, of the people who said they would visit their home towns, 52 percent also said they would get there by automobile. Considering the monumental “u-turn rush” traffic jams that occur during the specified holiday period, it might have been interesting to find out how many people decided not to go home because of traffic jams and crowded trains. It’s easy to blame apathy about summer vacation on economics, but logistics has a lot to do with it, too, especially when they’re qualified by financial considerations. These things all go together.

Electronics makers lead the way in killing off lifetime employment system

Tuesday, August 7th, 2012

The big domestic economic news this week is the steep slide in stock prices for Sharp Corporation. Japan’s leading liquid crystal display manufacturer has seen its shares fall 73 percent since the beginning of the year due to an oversupply of television sets in a world that no longer thinks Japanese home electronics are the best that money can buy.

If you’re not Takashi Okuda, president of Sharp Corp., you probably don’t have lifetime employment. (Kyoto photo)

The only thing keeping Sharp going at this point is its parts supply business, especially the deal it has with Taiwan-based company Foxconn, which assembles iPhones and iPads for Apple and uses Sharp-manufactured liquid crystal displays. Last week, Sharp announced it was eliminating 5,000 jobs from its worldwide 56,000-person workforce, the biggest employment cut in the company’s history. It is also going to slash management salaries, including the president’s, by 50 percent. Originally, it was only going to be 20 percent.

In terms of pure numbers, Sharp’s cuts are actually modest compared to other electronics makers. Last January, NEC announced it was eliminating 10,000 jobs. Sony also said it would cut 10,000 employees in April. Panasonic, which employs more than 360,000 worldwide, has said it has “targeted” 7,000 positions in its headquarters alone working in office services, R&D and production technology. They will either be transferred to other divisions or subsidiaries, or pressured to take early retirement. And as these companies scale back, affiliated businesses will have to do the same. Renesas, one of Japan’s leading semiconductor makers, which mainly supplied NEC, will have to cut 30 percent of its workforce, the equivalent of 12,000 jobs.

Even the electronics companies that are stable right now, like Toshiba and Hitachi, haven’t escaped the downsizing trend; they just carried out their massive job cutting a few years ago, which is one of the reasons they’re doing relatively well right now and aren’t in the news as much. Another reason is that they’ve moved away from consumer electronics, where the competition is just too fierce.

Not surprisingly, home electronics is no longer a field that young university graduates are interested in. Ten years ago, Sony, Panasonic and others of their size were at the top of the wish lists of college seniors, but according to the online version of the business magazine Diamond, all new graduates care about now is getting a position in the public sector. Though the official unemployment rate in Japan is only 4.5 percent, young people know that securing work does not mean security, at least not in the classic sense, so even getting a job with an “excellent company” doesn’t guarantee a job for life. Only the civil service does. The government never restructures.

A survey was carried out by the employment consulting firm, Leggenda Corp., of students who will enter the workforce in 2013. More than 50 percent say their first choice is to work for the government. The Japan Institute for Labor Policy and Training gets more specific. In a survey of 4,000 20-year-old men and women, they found that 87.5 percent will prioritize lifetime employment (shushin koyo) when they look for their first job. These respondents also look forward to “age-based promotions and raises,” another attribute of the old Japanese employment system that has gone the way of the dodo, at least in the private sector. This is the highest percentage on record, which just goes to prove that people really don’t miss their water until the well goes dry.

Somebody has to pay for cheap beer

Friday, August 3rd, 2012

Aeon’s beer case: Does this look cheap to you?

Late last month, the Fair Trade Commission issued a warning to three liquor wholesalers whom the commission suspected of violating the Antimonopoly Law by selling beer to the supermarket chain Aeon at below cost. It was the first time the FTC ever made such a warning about dumping for alcoholic beverages, and while the media is reporting that the commission apparently does not have enough evidence to prove a clear violation of the law, the FTC has made an exception and issued the warning anyway, which would seem to indicate that it strongly believes some hanky-panky is going on.

The main reason for the warning in this instance is to protect smaller liquor retailers located near Aeon outlets who can’t hope to compete with such low prices. In fact, a closer reading of the coverage would seem to indicate that it is really Aeon who is bending the rules to its advantage rather than the three wholesalers — Mitsubishi Shokuhin, Nihon Shurui Hanbai, Itochu Shokuhin — but in any case the warning was mainly directed at them. Nevertheless, Aeon decided that the adverse publicity attached to the warning was serious enough for it to hold a press conference on July 23. A representative stated that the company made no such demand to the three suppliers to sell them beer at below cost.

Apparently, the FTC was suspicious of dumping as long ago as 2005, when it heard that 10 brands of beer and happoshu (malt liquor) were being sold to Aeon at prices that were below the price they paid to the manufacturers, even with ancillary costs like transportation factored in. Aeon would then add its own margin and, supposedly, still undersell competitors. For instance, the wholesaler would buy a case of beer from a manufacturer for ¥3,800 and then sell it to Aeon for ¥3,700. The wholesaler would supposedly make up for the beer loss by carrying out a business practice known in Japan as arari-mikusu, which means jacking up the prices of other alcoholic beverages they sold to Aeon. Consumers would pay more for these products than they normally would. Such a practice violates National Tax Agency guidelines for fair trade.

Continue reading about cheap beer in Japan →

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