Changing Japan: Seiyu and Wal-Mart

Seiyu

The food store near my home is part of Seiyu, a chain that was bought up by Wal-Mart a few years ago. Acording to an interesting report on The Japan Today, a global coalition of unions is launching an unprecedented campaign to organize workers around the world at Wal-Mart, seeking to bring a new level of globalization to the labor movement. According to a statement from UFCW, Wal-Mart "pays poverty wages, ships jobs to countries where sweatshops are prevalent and, in the U.S., shifts enormous health care costs onto taxpayers."

Because of its size, Wal-Mart is able to drive down wages and benefits, which "has become the new global economic model" followed by many other firms, says the U.S. union. In fact, Wal-Mart employees have been able to form unions in Germany, Japan, Brazil and other countries, but never in the U.S.

Wal-Mart's Japanese affiliate, Seiyu, reports disappointing results in Japan. Seiyu has lost money every year since Wal-Mart first acquired a stake in 2002. "In the Japanese consumer mind, they're seen as selling cheap stuff at cheap prices -- and that can be a problem," says David Marra, a principal at management consultancy A.T. Kearney Inc. in Tokyo, according to an analysis by Business Week.

When I first lived in Tokyo, I did most of my shopping at small "mom-and-pop" shops but these days, large stores like Seiyu seem more common. They are anonymous and soul-less, with no character at all. So what was the point of all that reform?

The New York Times described the changes in Japanese towns:

Deregulation has been accepted without any criticism in Japan as a great measure for reviving the economy," said Shoji Muranuki, leader of a citizens' group that won concessions from a retail chain seeking to open in the neighborhood. "But how can we say that deregulation is helping the economy when so many local shopkeepers and merchants are hurting because of it?"

Groups like Mr. Muranuki's and business associations that sat by quietly as the effects of deregulation spread are now increasingly vocal about drawing the line somewhere. Breaking up a telephone monopoly like the Nippon Telegraph and Telephone Corporation is one thing, they say, but destroying the livelihoods of local shopkeepers is going too far.

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