An interesting principal/agent problem in Japan regarding convenience store franchisees, exacerbated by a regulatory environment which considers it a principal/principal relationship.https://www.japantimes.co.jp/news/2019/05/27/national/behind-scenes-24-7-service-realities-owning-japanese-convenience-store/#.XOypQCVcWEc …
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Contra some other commentators I actually think both the franchisor and franchisees have understandable POV here: konbini *really are* indispensable public infrastructure and the brand doesn’t want Store 6483 doing a $10k LTV hit by turning away a single customer to competitors.
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And franchisees *really do* operate on the economic and social margins while being relatively unsophisticated at business and mostly dependent on the franchisor, who they expect will deal with them like a Japanese company does with full-status employees.
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And the government *really does* look at this relationship and see two for-profit businesses which have tax returns and opportunity for legal advisors and everything and says “Well then, best of luck with spirited capitalism.”
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In the US the regulations are tilted a bit more in franchisees’ favor and there have been decades of often-times acrimonious disputes. Also, because franchising itself more competitive, franchisor have to compete for franchisee time and attention.
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(There is a very prominent word starting with I and ending with -ation not mentioned in the article whose implications are very obviously sweeping through Japanese convenience stores right now. I would expect 80% of them to not be owned by ethnically Japanese people in 20 years.)
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End of conversation
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