Yen for Living

Before the fall

Good news for beef lovers. On April 10 gyudon (beef bowl) chain Yoshinoya announced it would cut the price of its standard namimori serving by ¥100 to ¥280 starting April 18. Sukiya, the No. 1 gyudon chain, was selling its namimori version for ¥250 until April 12, and No. 3 in the race, Matsuya, was doing the same thing until April 15.

At the press conference where Yoshinoya made the announcement, company president Shuji Abe told reporters that Yoshinoya felt it could not reach its desired sales target “with prices as they are,” and since “price is the biggest factor affecting sales,” they decided to cut it by more than a fourth. Though Yoshinoya’s two rivals are ending their own price-cut campaigns this week, they carry them out on a fairly regular basis, so it’s likely they will react in kind to the announcement.

In reporting the announcement, the Asahi Shimbun reporter remarked that, although consumers will certainly appreciate the lower price, how can Yoshinoya hope to make a profit after such a drastic cut? Moreover, what does the move say about the government’s strategy of boosting inflation? Yoshinoya’s Abe stressed that the business environment has become “even more difficult” owing to the decrease in the yen’s value, which makes importing beef more expensive. But he also said that the company will still be able to turn a profit because it plans to import even more beef and thus can expect cheaper wholesale prices now that the regulations with regard to beef imports have changed.

In 2004, imports were restricted due to the BSE scare, but those restrictions have now been lifted, and beef from older animals can be sold in Japan. In addition, Yoshinoya plans to cut its retail personnel by “making the work routine in restaurants more efficient.” So even if the prices for the main product drop by 25 percent, according to company projections based on past experience the number of customers should increase by 30 percent, and if that happens sales will increase 15 to 20 percent.

A food industry analyst pointed out something else to the Asahi: Fast food in general has become cheaper in the past 10 years or so, and consumers have just become accustomed to the fact. There seems to be an upper limit to what they will pay, and chain businesses know this. What that means is that these businesses will fall into a permanent state of price competition, even as the cost of ingredients goes up. That means personnel costs will not rise; if anything they’ll have to be cut. And restaurants that don’t belong to chains will be squeezed out. For a while Yoshinoya tried to compete in terms of quality and selection by adding new products to their line, but obviously they’ve abandoned that strategy and returned to price competition.

This is not the kind of outcome the government wants, but consumers have become so used to lower prices they probably won’t spend more except for basic necessities, and the retailers who can keep their prices down will make profits through volume. Much has been made in the media of how department stores are suddenly enjoying better sales, but their customers tend to be people with larger amounts of discretionary income through investments in stocks and foreign currencies, both of which are going up. Such people spend their windfalls on expensive watches. They are not representative of the general public, much of which still decide their spending regimens based on wages and salaries, and despite the government’s hopes and efforts those aren’t likely to rise any time soon.

Japan has become a nation of coupon clippers and bargain hunters. It’s a hard habit to break.

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Earlier this month a panel of experts recommended to the health ministry that it relax standards restricting imports of beef from the United States, Canada, France and the Netherlands for animals that are more than 20 months old. The panel suggests that cattle up to 30 months old be allowed for import and sale in Japan.

Get it while it’s cheap: Yoshinoya outlet in Roppongi, Tokyo

The restrictions were implemented in 2005 after BSE, or “mad cow disease,” was discovered in some livestock in the U.S. in 2003. Between 2003 and 2005 beef imports from the U.S. were banned. When the restriction went into effect, the U.S. objected, saying there was no conclusive proof that the age of the animal has anything to do with whether or not it can get BSE, and in any case, the incidence of the disease was extremely small and statistically insignificant. The government panel seems to have agreed with this opinion by saying that the age of the cow has no relationship “to people’s health.” They will give their official evaluation to the health ministry some time this fall, and the regulations should be relaxed by early next year.

Retailers and restaurateurs, especially fast food chains, are happy with the panel’s decision since it means they can start selling more U.S. beef, which is very popular among consumers here because of its higher fat content. More than 60 percent of the beef sold in supermarkets now is Australian, with 20 percent coming from the U.S. and the remainder from domestic producers. Though the American dollar is, for the moment at least, worth less in Japan than the Australian dollar, U.S. beef is more expensive than Australian beef due to the restrictions. In fact, the high yen is the only reason U.S. beef is at all affordable in Japan right now. By limiting U.S. beef to animals less than 21 months old, imports are seasonal and thus more expensive. Only about 20 percent of all cattle in the U.S. is slaughtered at less than 21 months, while 90 percent is less than 31 months. Consequently, almost all the animals slaughtered in the U.S. can be exported to Japan after the new year.

Continue reading about U.S. beef imorts →

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Hit me: One of two Sukiyas near Kamiyacho Station in Tokyo

Last month, many news outlets reported an attempted robbery of the Asaka, Saitama Prefecture branch of the gyudon (beef bowl) chain Sukiya. Though such crimes are still rare in Japan when compared to other countries, this one received a lot of attention because of what the stickup man said as he brandished a knife at the counter person: “Maido onajimi no Sukiya . . . ,” which basically means he comes to Sukiya often, though it isn’t entirely clear if he meant as a customer or as a thief.

Sukiya is the number one gyudon chain in Japan, owing mainly to the fact that it’s got the most branches: about 1,500 nationwide. The next biggest chain, Yoshinoya, operates about 1,200, with Matsuya a distant third with 800. But if Sukiya has an edge over Yoshinoya in terms of sales, in terms of robberies it’s miles ahead. According to the National Police Agency, between January and August, Sukiya branches were the victims of 90 percent of the robberies perpetrated against gyudon restaurants. That’s an impressive portion, though it should also be pointed out that, altogether, there were only 57 robberies of gyudon restaurants nationwide during this period. Robbery, as a matter of fact, has been on the decrease in recent years, though the targeting of gyudon restaurants has risen.

According to an article in the Tokyo Shimbun, there are a variety of reasons for the increase. The main one is that almost all robberies of commercial businesses take place late at night, and over the past decade most gyudon restaurant chains have extended their business hours and are now open round the clock. A lot of other 24-hour food service businesses use vending machines to collect money; and convenience stores, which are also open all the time, have less cash on the premises thanks to the widespread use of e-money, debit cards and prepaid cards. Two thieves who were caught in August after robbing a Sukiya in Tokyo of ¥200,000 told police they had gotten the idea from discussion groups on the Internet. Apparently, would-be robbers often trade intelligence on good places to hit, and because Sukiya is so well-known and there’s a branch on practically every corner, it’s seen as an easy target.

In any case, the Asaka thief wasn’t a particularly good one. The counter person, a part-timer, managed to hit the alarm button and the police captured the robber shortly after he left. Since most Sukiya branches already have alarm systems installed, the police have suggested they, pardon the pun, beef up their late-night staff, though that would obviously defeat the whole purpose of a chain like Sukiya, which charges rock-bottom prices. It’s why they’re number one, even if in surveys real gyudon fans much prefer Yoshinoya.

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In a recent article in a regional Australian newspaper, an expat Japanese sushi chef complained that sushi chefs Down Under were getting a bit carried away with the mayo, not to mention the avocado, claiming that overuse of these two non-Japanese ingredients spoiled the sushi-eating experience. He added that in Japan, they don’t use as much.

Don't hold the mayo: Kappa Sushi

Obviously, he hasn’t been to a kaiten-zushi restaurant in his native country lately. Kaiten sushi are the fast-food dispensers of Japan’s most distinctive cuisine, where sushi is churned out by human and/or automated means and placed on conveyor belts that pass in front of patrons who just pick them up. After they’re finished, an employee counts the dishes and adds up the bill. The incorporation of mass-production methods means kaiten-zushi establishments can cater to families with young children, a demographic that traditionally was not welcome at sushi bars, where the dynamic is more personal: You deal directly with a chef who stands in front of you and makes dishes to your order. As kaiten chains became more widespread and more cost efficient, the variety of dishes expanded to satisfy newer or younger tastes; which is why what they now serve will likely offend the finer sensibilities, not to mention the pride, of traditional sushi chefs. Not only are mayonnaise and avocado regular ingredients at kaiten chains (and, contrary to what the gentleman in Cairns claims, slathered on quite liberally), but they also offer salads, Western-style desserts, and, making the fast-food analogy complete, hamburger and hot dog sushi.

Continue reading about kaiten-zushi

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All lines lead to Ginza

You may have heard that the American fast food chain, Wendy’s, will be closing all 71 of its Japanese outlets on Jan. 1. Zensho, the local company that runs Wendy’s Japan, announced at the beginning of the month that it would not renew its contract with Wendy’s, which runs out Dec. 31. According to J-Cast News, McDonald’s is just too strong in the hamburger biz and Zensho has other chains that it wants to concentrate more resources on, like the gyudon (beef bowl) restaurant Sukiya, udon (noodles) restaurant Nakau, Cocos Japan, and the family restaurant Sunday Sun.

As often happens in situations like this, Wendy’s is suddenly the most popular fast-food chain in the country. Since the announcement was made, all the outlets have reported lines forming even before they open, and then after they open selling out a full day’s worth of their hamburger products by the early afternoon. The Wendy’s at Shin Yurigaoka in Kawasaki told J-Cast that usually by the time dinner rolls around all they have left is chicken sandwiches and fish sandwiches, but other outlets don’t even have those left. After the standard Wendy’s burger, the most popular item is Wendy’s chili, something you can’t get at McD’s. There’s been hundreds of Twitter posts a day from Wendy’s fans reporting on what’s available and what isn’t. “I went to mourn, but everything is sold out except drinks!!!” one micro-blogger reported.

Continue reading about Wendy's leaving Japan →

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Does this look appetizing?

Lots of jokes on the Internet about Burger King’s PR stunt with Microsoft to promote the launch of the latter’s Windows 7 OS last week. For seven days starting Oct. 22 the first 30 people who order one at any Burger King Japan outlet (all 15 of ‘em!) can have a “Windows 7 Whopper,” containing seven beef patties, for only ¥777. After that, you have to pay ¥1,450.

According to a wide show report I saw yesterday, this one sandwich adds up to 2,100 calories, which is more than you need in one day. Three guests on the show were presented with the stacked goods and none seemed too pleased to have to eat it — they needed knives and forks, in fact.

In food-happy Japan, the campaign itself doesn’t sound so surprising. What is surprising is that, according to the reporter on the wide show, most of the takers are women. Maybe I’m out of touch lately, but burgers for breakfast (how else are you going to take advantage of the ¥777 deal?) sounds like a guy thing to me. Maybe these women are taking the burgers home and making seven separate sandwiches to freeze for later? Japanese women love to save money.

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