1. Does the same sign mean the same company runs the store?
A convenience store sign glowing in the night, a uniform in specific colors, and familiar products on the shelves. Because every store looks the same, people often assume they are all shops of one single company. In reality, there are two ways stores are operated.[1]
A "directly operated store" is run by the headquarters itself, which also hires the employees. On the other hand, a franchise store is run by a separate business operator who has signed a contract with the headquarters. The Fair Trade Commission guidelines explain that a franchise system gives members the right to use specific trademarks or trade names from the headquarters. Legally, the franchisee is an independent business operator from the headquarters.[1]
In other words, having the same sign and having the same company run the store are two different things. Materials introducing the definition by the Japan Franchise Association also describe it as a form where business operators connect through contracts to provide goods or services under the same image.[4] This leads to the question of how many directly operated stores actually exist.
2. How many convenience stores are directly operated by the company?
We can check this using a table of domestic convenience store numbers published by Seven & i Holdings.[2]
At the end of fiscal year 2024, there were 21,402 franchise stores and 150 directly operated stores. The total is 21,552 stores. The ratio of directly operated stores is 150 divided by 21,552, which is approximately 0.007, or about 0.7%. Conversely, if you divide the total number of stores by the number of directly operated stores (21,552 ÷ 150), you get approximately 144. This means "about 1 in every 144 stores" is directly operated. It is not 1 in 100.[2]
Ten years prior, at the end of fiscal year 2014, there were 17,021 franchise stores and 470 directly operated stores, for a total of 17,491. The ratio was about 2.7%, or about 1 in every 37 stores. The number of directly operated stores dropped from 470 to 150, a decrease of about two-thirds. Meanwhile, franchise stores increased by more than 4,000.[2]
Looking at the numbers alone, almost all the increase in stores has been handled by franchises. This raises the question: who are these franchise owners?
3. What kind of managers are franchise owners?
When people think of a franchise owner, they might imagine a family running and protecting one single shop. Such stores certainly exist. However, that is not all.[3]
In materials from a survey conducted by the Ministry of Economy, Trade and Industry between October 2019 and August 2020, it was found that 5,911 stores—about 10% of convenience stores in the survey scope—were operated by 323 corporate owners who each managed 10 or more stores. There are also "mega-franchisees" who operate more than 100 stores.[3]
If you divide the 5,911 stores by the 323 owners, the average is about 18 stores per person. This figure is an average only for corporate owners managing 10 or more stores; it is not the average for all owners. Still, it shows that among franchise operators, there are managers who bundle multiple stores together. Franchise members are business operators who make management decisions separately from headquarters, not just branch offices of the brand.[3]
The numbers are from around 2020 and may have changed since then.
4. Can you tell from the outside if a store is directly operated or a franchise?
In stores with the same signs and uniforms, can you guess whether it is directly operated or a franchise just by looking at the exterior?[1]
It seems difficult to reliably distinguish between a directly operated store and a franchise store based only on the appearance or interior. This is because the franchise system provides goods and services with a unified image under the same sign, so signs, uniforms, and sales floors are standardized.[4]
A candidate clue is the business license. For industries that require a license to handle food, licenses are required for each store, and local governments guide owners to display the license in visible places like near the entrance or register.[5] A food hygiene supervisor must also be appointed for each store. However, because the rules for how the operator's name is written on the license vary slightly by municipality, you cannot judge whether it is directly operated or a franchise from this information alone.[5]
Being hard to distinguish is not necessarily bad for customers. The strength of this system is that in either type of store, you can shop in a similar way according to the promise of the same sign.
5. How can you check the numbers and posted notices at your local convenience store?
Things you can do at home: Open the table of domestic convenience store numbers from Seven & i Holdings. Use a calculator to find the ratio of directly operated stores using the figures for fiscal years 2014 and 2024. Calculate 150 ÷ 21,552 and 470 ÷ 17,491. If the answers are approximately 0.7% and approximately 2.7%, they match the text above.[2]
Things you can do by going out: Go to a nearby convenience store with an adult. Look for where the business license is posted. Be careful not to disturb the store; just look. It might be interesting to compare what is written and where it is posted at different convenience stores.[5]
Official documents: The Fair Trade Commission guidelines on franchise systems and materials from the Ministry of Economy, Trade and Industry study group are available online in Japanese. They explain the position of franchisees and the concept of contracts using official language.[1]