Color of Anarchism Re: Protest ISO...

Yoshie Furuhashi furuhashi.1 at osu.edu
Fri Jan 3 23:43:07 PST 2003


At 8:10 PM -0800 1/3/03, Gar Lipow wrote:
>Supose co-ops like the (Winpeg) Mondragon Co-op were everywhere -
>resteraunts, food stores - not some gigantic percentage of the
>economy, but enough so that everyone came into the contact with them.

Co-ops are everywhere in Japan -- not that it is any closer to an anarchist utopia, though.

***** From #103, November-December 2002

Japan Co-ops Endure Recession, Innovate

From: Japanese Consumers' Co-operative Union

Editor's note: Information below is taken from the English-language newsletter of the Japanese Consumers' Co-operative Union (JCCU); their website is located at http://www.coop (click "English"). --D.G.

Years of recession have led to shrinking sales for most of the grocery industry in Japan. Consumer food co-ops, the largest such sector in the world, reflected this pattern but not as markedly; total sales for FY 2000 and 2001 were 98.3 and 99.2 percent of the previous year, respectively. However, tighter management has enabled Japanese consumer co-ops to increase membership number and share capital, and a higher percent of the co-ops showed a profit in the past year.

Recession aside, Japan's amazing co-op numbers continue to make the U.S. look underdeveloped. Membership nationally totals over 21,000,000; members of retail co-ops account for 90 percent of that total. Of the retail members, more than one-third are in Han groups, three or more neighbors who order together. Like U.S. buying clubs only more urban and smaller, Han (joint purchase) groups number over 1,500,000 and have some 7,000,000 members. There also are 2.4 million members of medical co-ops and over 800,000 members of housing and insurance co-ops....

Total turnover (revenue) by these co-ops was 3,257 billion yen or over 25 billion dollars. There are about 450 retail co-ops with 2,364 outlets.

Mostly located in dense, urban settings, Japanese food co-ops have seen strong growth in the relatively new fields of home delivery services and Internet ordering. Sales through Han groups, the traditional non-store sales outlet, actually are decreasing and are at their lowest in more than ten years. Home deliveries are growing and account for a total of 300 billion yen (over 2 billion dollars) annually. Delivery fees have been reduced over time; in Tokyo the fee is only 180 yen. A minimum of 60 deliveries per day is said to be the break-even point.

Internet operations work for the co-ops because members are able to procure through established home delivery and joint purchasing systems. An Internet platform offered by JCCU to co-op members in 2000 now has 55,000 registered members in 13 co-ops. Kyoto Co-op in its first year of joint purchase orders via the Internet had 350 million yen in sales through the system. Ordering, product information, member comments, co-op news and activities -- all are transmitted to or from home or work or mobile phone.

<http://www.cooperativegrocer.com/cg2002/japan103.shtml> *****

***** Agribusiness Perspectives - Paper 13

Sanchoku - Supply Chain Management in Japanese Consumer Co-operatives

* Ada, R., Kawasaki, H., & Doolan, R.

* Rick Ada is the Principal Agricultural Economist with the Department of Primary Industries, Toowoomba, Queensland. Hiroto Kawasaki works for the Iwate Consumers' Co-operative, Morioka, Iwate. Robert Doolan is a Senior Trade Officer with the Department of Economic Development and Trade, Queensland. This paper is based on research conducted by the Queensland Department of Primary Industries and was partially funded by the Rural Industries Research and Development Corporation. For more details see, 'Japanese Consumer Co-operatives and Direct Transactions - Sanchoku' (1997) by Ada, R. & Kawasaki, H., Department of Primary Industries, Queensland....

Introduction

The Japanese Consumer Co-operative Movement is among the largest consumer buying groups in the world. With more than 19 million members, a 2.7% share of the Japanese retail market and a 7% share of the Japanese food market, the co-ops are the largest retail group in Japan. Based on co-operative philosophies and democratic management principles, the Japanese consumer co-ops have developed a number of unique characteristics and methods of operation, such as the joint buying (Han) groups, Co-op Brand products and a number of consumer movements. These features, including sanchoku, have given the co-ops a special place in the distribution industry in Japan and assisted in their rapid growth.

Sanchoku or direct delivery (direct transactions) has become an important competitive feature for Japan's consumer co-operatives. Whilst it is similar in many ways with direct supply contracts developed between commercial supermarkets and agricultural producers, sanchoku has developed a number of unique characteristics which bring consumers and producers together. Begun as a means of reducing the transactional costs between agricultural producers and consumers, sanchoku has become a mainstay of the consumer co-operative movement for the supply of fresh foods including fish, fruit and vegetables, beef and pork. Traditionally only used in developing relationships with Japanese producers, sanchoku is now being extended to international suppliers as the co-operatives seek safe, good quality food products from around the world.

In this paper, we aim to:

i.provide an overview of the Japanese Consumer Co-operative movement ii.give details of the operation of sanchoku in the regional co-operatives and a view of the future of sanchoku and opportunities for international sanchoku....

The Japanese consumer co-operative movement has a history dating back to the 19th century, but it has risen to prominence mainly since the early 1980's. The first Japanese consumer co-op was established in 1898 and the number has grown dramatically, particularly during the period following World War II. The Japanese co-ops have developed and grown following the basic principles of the original English Rochedale Co-op.

In 1844 a group of 28 weavers, today known as the 'Rochedale Pioneers', started a shop in the small town of Rochedale in England. This group are attributed with the origin of the co-op philosophy (Ross and Langdon 1985, p. 3).

The 646 consumer co-op societies in Japan supply a wide range of services to their members including insurance, medical services and housing and include many different types of co-ops. The largest group is the regional co-ops which generate more than 80% of the total ¥3,375 billion annual turnover. These co-operatives operate 1 378 retail outlets throughout regional Japan and primarily supply members with food and other household goods. Over recent years the number of outlets has decreased as the co-ops have increased the number of large stores (over 3000m2), whilst scrapping their smaller stores.(Oguma, 1997)

The products carried by the regional co-ops range from highly perishable foods to packaged holiday tours. The emphasis, however, is on the fresh food products. Some 69 per cent of total turnover are food sales, 46 per cent of which is fresh foods. (Figure 2) Around 20 per cent of this fresh food is obtained through direct transactions (sanchoku) with producers, often bypassing wholesale markets. Over 50 per cent of this direct transaction business is conducted with agricultural and fishery co-ops....

Sanchoku - Direct Relationships between consumers and Producers

Sanchoku is a movement and co-op business created by co-operation between consumers and producers, to achieve a stable supply of safe, high quality product at a stable and reasonable price. This movement was initiated by the co-ops to overcome the dominance of the public wholesale market in the perishable food distribution system and the control of the processed food distribution system by major food companies. To achieve this outcome, the movement encourages the development of regional agriculture and industry, and promotes sustainable agriculture whilst reforming the distribution system. A clear aim is to 'support the production of local farmers, keep food costs down, and make sure food is safe to eat'. (JCCU, 1996b)

Sanchoku (often translated as 'direct transaction') is the supply of fresh food products (mainly meat, fish, fruit and vegetables), directly from producers or agricultural organisations (such as farmer and fishery co-ops) to consumer co-ops, usually without the intervention of wholesalers, markets or other 'middlemen'. Whilst the concept of direct delivery is not unusual and is a feature used by many large commercial retailers, there are a number of conditions applied to sanchoku in the Japanese consumer co-ops which make it unique.

There are three basic principles applied to sanchoku:

* The origin of the product and the name of the producer should be clear to the consumer. Co-op members are supplied with detailed information by the co-op through newsletters, weekly product catalogues and signs in the supermarket stores. In some cases, producers will visit co-op stores and discuss their product with co-op members.

* The consumer should know the method of production. The essence of sanchoku is that producers are contracted by the co-ops to supply primary products direct from the farm or fishery to the co-ops. The products must meet specifications on quality and size and delivery dates, all of which are features of most contracts. However, in addition to the usual contractual agreements, producers must also meet agreed conditions on the way in which the product is produced. In particular there are restrictions on the use of chemicals and, in some cases, artificial fertilisers which may be regarded as potentially injurious to the consumers' health or damaging to the soil and the environment. Sanchoku is seen as a way of guaranteeing the safety of products for members. Co-op staff or their representatives regularly visit suppliers and product is tested to ensure that standards are met. Information on the methods of production is provided to members.

* There should be exchanges between consumers and producers. Consumers are encouraged to visit suppliers' farms and special events are organised by the co-ops to allow members to see how their food is produced. Producers are also encouraged to meet members and will visit city consumers and homestay with co-op member's families. The exchange of information between producers and consumers is a key operational feature of sanchoku and one that makes it unique among forms of direct transaction. Both consumers and producers extol the virtues of this type of contact. Sanchoku puts the producers in direct contact with consumers, improving the lines of communication and enabling both parties to share experience and better understand and meet each other's needs.

Information exchange takes place in both direct and indirect ways. For consumers distant from the production centres direct contact is more difficult; however, they are encouraged to write to producers making comments on the products and suggestions for improvements. The consumer co-ops also organise trips for members so they can inspect the places of production. Consumers not only comment on products but also provide encouragement and assistance to producers.

Other forms of communication used include visits by producers to co-op stores, where they can discuss issues directly with their customers; newsletter articles for co-op members in co-op publications; indirect feedback from members, through visits by co-op staff to producers; and direct contact with producers by mail or telephone.

The aims of this communication are not only to provide feedback on products but also to reduce the widening gap in understanding between city and rural people. The rural areas are the source of much of Japan's cultural heritage and visits to these areas give city-based co-op members the opportunity to revisit their cultural roots.

Sanchoku incorporates social and environmental elements in addition to the commercial supply chain issues. Commercially, sanchoku provides the co-ops with a source of fresh, 'safe' food with some savings in the distribution costs and, importantly, a market image, as a retailer of 'safe' foods. Socially, sanchoku is seen as supporting Japanese agriculture, both regionally and nationally. This is particularly important in view of co-op members' desire to improve Japan's self-sufficiency in food. Currently at 42% on a calorie basis. (JCCU 1994)....

<http://www.agribusiness.asn.au/review/Perspectives/IAMAConfPaper.html> *****

***** Agribusiness Perspectives - Paper 33

Direct Supply Relationships with Japanese Consumer Co-operatives - A Market Opportunity 1

Rick Ada, Principal Agricultural Economist 2

Abstract Japanese consumer co-operatives are the largest food retailers in Japan representing more than 25 per cent of Japanese households, with a membership of over 20 million. The co-operatives have established direct supply relationships with fresh food producers as a means of ensuring product safety and freshness for their customers. Known as sanchoku, this direct supply is characterised by supply chain relationships that encourage close contact between producers and consumers. This paper outlines research conducted into the consumer co-operative movement and the requirements to access this large and growing market. It concludes that the co-operatives represent a significant opportunity for Australian food exporters to provide a differentiated product to the Japanese market. The results of case studies of two Australian producer groups, firms that have used the research results to gain market entry to the co-operatives, are highlighted and generalisations are made regarding the necessary considerations for producers wishing to export to Japanese co-ops.

<http://www.agrifood.info/Review/Perspectives/2000AdaJapanCoops.htm> ***** -- Yoshie

* Calendar of Events in Columbus: <http://www.osu.edu/students/sif/calendar.html> * Anti-War Activist Resources: <http://www.osu.edu/students/sif/activist.html> * Student International Forum: <http://www.osu.edu/students/sif/> * Committee for Justice in Palestine: <http://www.osudivest.org/>



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