One Kind of Everyday Facility Worth Watching Closely When You Invest
Hello — I’ve recently been busy traveling around on site visits, so the article on the Philippines I’d promised has been delayed. But during a long high-speed rail journey of over ten hours, I had time to read a couple of short books, and one of them turned out to be genuinely useful for area analysis — I’ll share more on that another time. One of them, a special feature in a book called “Know Japan” (“Chi-Nichi”), caught my attention: an idea I’d wanted to write about for years, and I finally got to finish the piece on that train ride.
Japan’s first 7-Eleven opened in 1974. From 1977 to 1986, the store count surged from under 5,000 to 35,000, and by 2017 it had reached 56,000. In this intensely competitive market, convenience store chains keep refining their strategy, and they have become an indispensable part of daily life in Japan.
But what does this have to do with property investment in Japan? Under intense competition, convenience stores have evolved in two directions: their customer targeting has become increasingly precise, and their site-selection strategy has become extremely rigorous. Both of these competitive dynamics can help us read a neighborhood’s population density and the character of its resident community more quickly.
On population density, 7-Eleven is a clear standout. It operates 19,166 stores across Japan and ranks first in consumer preference; among the differences in preference, over 60% of respondents rated 7-Eleven as having the best reputation. Beyond a wide product range, convenience is one of the main reasons — and that sense of convenience comes precisely from the fact that 7-Eleven’s site selection follows population as its key indicator.
Below is a chart comparing municipality-level population in the Tokyo metropolitan area against the three convenience store chains that together hold close to 90% market share — 7-Eleven, FamilyMart, and Lawson. Taking “more populous areas have more stores” and setting the correlation coefficient to “1” at 100% correlation, 7-Eleven scores 0.764 — meaning close to 80% of its stores cluster in densely populated areas — while FamilyMart and Lawson score 0.34 and 0.248 respectively, meaning less than half of their stores follow that same pattern.
Beyond an overall population-first siting strategy, store openings are also subject to strict internal review. Chains maintain dedicated site-selection teams that analyze each area’s population advantages in detail, right down to road-usage patterns, pedestrian and vehicle traffic flow, daily movement habits, income and spending habits, and more. Once a location is targeted, even if initial negotiations fail, the chain will open a store nearby first while continuing to negotiate with the site’s owner, persisting until it succeeds in securing that spot — which is why a 7-Eleven location is, without exaggeration, chosen from among countless alternatives. This has become a practical, observable living-standard indicator for property investors in Japan.
Of course, convenience store density is just one angle of analysis — next time, I’ll cover how the convenience store market itself is segmented.
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References
- “The Philosophy of Retail: 7-Eleven’s Founder Tells His Own Story”
- “Know Japan: Convenience Stores”
