Posts Tagged ‘Book Off’

Annals of cheap: Don Don Down on Wednesday

Wednesday, February 27th, 2013

We all know Japanese people prefer new stuff — new homes, new rice, new prime ministers every 12 months — which may explain why the used clothing business isn’t as big here as it is in other countries. According to the Asahi Shimbun, 50 percent of discarded used clothing in America is recycled, either commercially or as contributions, and the portion in South Korea is 80 percent. In Japan, it’s only 20 percent, meaning that the rest is simply trashed. But that may change with the advent of a new model for used clothing stores.

Don Don's website

Don Don’s website

Don Don Up Co. Ltd., headquarted in Morioka, Iwate Prefecture, opened its first used clothing store, called Don Don Down on Wednesday, in Hachinohe, Aomori Prefecture, eight years ago. The company now commands a chain of 60 outlets nationwide, with more to come. Don Don, an onomatopoeic word expressing a process of steady progression, came up with an ingenious pricing system that not only saves the company overhead and personnel costs, but draws customers on a weekly basis by turning shopping into a “game,” as its promotional literature puts it.

All the merchandise is affixed with price tags, but the tags don’t display yen amounts. Instead they have pictures of fruits and vegetables, 10 in all. The pictures represent prices, which range from a high of ¥5,250 (i.e., ¥5,000 for the item plus 5 percent consumption tax) to a low of ¥105. These prices are listed on charts alongside their corresponding symbols and posted throughout the store. The price tag on a particular item never changes as long as it remains in the store.

The charts are changed weekly. For instance, this week, perhaps, all the strawberry items cost ¥5,250, but next week, all the remaining strawberry items will be priced at ¥4,200. Each week, the line of a particular fruit or vegetable goes down one pricing rank until it reaches ¥105. The following week all the items previously priced at ¥105 are removed from stock and exported to Southeast Asia in bulk, which means no item stays in the store for more than ten weeks. The weekly price changes take effect on Wednesdays, thus explaining the name of the store. Not surprisingly, that’s the day they do their biggest business.

This system adds a touch of drama to the shopping experience. If a customer likes a particular item she can buy it right away or take a chance and wait til the following week when it’s cheaper, but then she risks the possibility that someone else will buy it. The president of the company told Asahi, “I want our customers to enjoy shopping as if playing a game. I wanted to change the image of the used clothing store, which tends to be dark.”

At first, the scheme was to try to replace the inventory as often as possible to keep people coming, but that meant changing price tags on a continuing basis to weed out unpopular items. It wasn’t until management hit on the fixed price tag system that they figured a way to not only streamline operations but make the process interesting for consumers.

As for procuring merchandise, Don Don’s method is similar to Book Off’s, Japan’s pioneer in used merchandise, which boasts 900 outlets. It bases the price it pays for a book on its condition and then places a seal on each volume that indicates how long is has been in the store. Every book that remains on the shelf for three months automatically gets reduced to ¥105.

When those don’t sell, they’re pulped. With the exception of some brand items, Don Don buys clothing from anyone by the kilogram: ¥500 for “very popular” items, ¥50 for “popular” items, and ¥10 for “useful” items. And they pay 50 percent more on Mondays and Thursdays. More significantly, they refuse very little that is wearable, since they can always sell it, again by the kilogram, to wholesalers in Southeast Asia. Just like produce.

Old technology a threat to publishers’ bottom lines

Thursday, December 20th, 2012

By the gross: cheap reads at Book Off

There was only one book published in Japan this past year that sold at least a million copies: TV personality Sawako Agawa‘s volume of essays, “Kiku Chikara: Kokoro Hiraku 35 no Hinto” (The Power of Listening: 35 Hints to Get People to Talk About Themselves), a relatively inexpensive paperback published by Bungeishunju. Though the media has been claiming for years that reading is on the decline, a single million-seller is still pretty low by Japanese publishing standards. Last year, for instance, there were ten, and two years ago five. According to the industry organ Shuppan News, the main reason is that there were no topical books for publicity departments to push effectively.

Publishers and wholesalers usually focus promotion on titles they think will sell easily, but this year couldn’t find anything they really thought would catch the public’s imagination. The conventional wisdom about million sellers is that a good portion of them are bought by people who aren’t devoted readers. Remember the phenomenal sales for Haruki Murakami’s “1Q84″? Many of the buyers were people who were caught up in the “event.” They wanted to own a copy — or several, as the case may be. Some probably didn’t even read it. Experts say this phenomenon no longer applies. Interests have become more compartmentalized, more diverse. People no longer automatically buy a book or record just because everyone else does.

According to a recent article in Tokyo Shimbun, book sales in general have dropped. The peak year was 1996, when 915 million books were sold for a total of ¥1 trillion in revenue. In 2011, the total number of books sold was 700 million and revenues were ¥819 billion. This year, the drop is expected to be even greater.

Now, before you ask about the sales breakdown between printed books and e-books, keep in mind that sales of e-books remain relatively low in Japan, owing to industry resistance that is just now breaking down. The drop in sales has less to do with technology and more to do with demographics. In fact, the number of people who read regularly hasn’t really changed despite the decline in population. That’s because the loss in general readership is being compensated for by older retired people who now have time to read. However, these people don’t really care about owning books. The real reason for the drop in sales is that they have rediscovered the library.

According to the Japan Library Association, there were 2,522 libraries throughout Japan in 1998. By April 2011, that number had increased to 3,210. Last year, library users borrowed 716 million books, CDs and DVDs, a new record, which is surprising given that local governments are hurting financially and library budgets are usually one of the first things they cut.

Obviously, some rationalization is going on, but at least one local government, Takeyo in Saga Prefecture, has come up with — no pun intended — a novel solution. The city hired the entertainment media rental and sales company Tsutaya to run its public library and has saved 10 percent of its normal operating expenses in the bargain. In return, Tsutaya opened a store next door as a kind of annex to the library, complete with a cafe.

A researcher interviewed by Tokyo Shimbun said that the recession definitely has something to do with the boost in library usage. It has also boosted the success of used book chain stores like Book Off. Sales of used books have been increasing every year. Naturally, this is bad news for publishers and, especially, new book stores despite the fact that prices for new books are fixed by the publishers and can’t be changed by resellers. These prices tend to be set artificially high by making the print larger than necessary and dividing texts into multiple volumes. But as much as the publishing industry has tried, it can’t do anything about the used book market.

According to the Yano Financial Research Center, the market for used books in 2010 was ¥130 billion. Sales at Book Off alone amounted to ¥70 billion in 2010. Even if one keeps in mind that Book Off sells merchandise other than books, the retail giant obviously has a substantial share of the market. Their system is attractive to people who just like to read. You buy a used book for a few hundred yen, read it and then sell it back to Book Off for about ¥50. It’s especially attractive when it comes to best-sellers, for which there is usually a long waiting list at the local library. By their very nature of being best-sellers, there are usually a lot of them at Book Off, sometimes for as little as ¥100 plus tax.

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