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Last Sunday morning, the Slow Food movement presented its leisurely charms to the breakfast crowd at a large suburban restaurant. Customers experienced unhurried table service and a 22-minute wait for pancakes, which brought about a sense of appreciation upon their arrival.
This delightful experience would be expected in Genoa or Santorini, but it was quite unexpected at a bustling McDonald’s just outside Yokohama.
The slowness was unintentional and apologetic, highlighting a discrepancy. Despite being realistically busy with customers, the restaurant was unrealistically understaffed. This was evident from the unusually long wait under the golden arches and the sign by the counter, which openly declared the workforce shortfall for each shift and appealed for prospective employees to fill the gaps.
Japan, unwilling to admit it to itself, is facing a problem. The necessary staff is unlikely to come, and the interim solution of “service shrinkflation” is only a temporary fix that cannot fool customers indefinitely.
For many years, Japan has excelled in providing high-quality service, especially in the food and retail sectors. Intense competition has raised customer expectations to incredibly high levels regarding cleanliness, punctuality, efficiency, knowledgeability, and attention to detail. However, failing to meet these standards in Japan is more noticeable than in other countries.
Even global brands like McDonald’s recognize the need to elevate their game in Japan and have historically done so.
The variable factor in recent times is Japan’s chronic labor shortage, a slowly emerging crisis resulting from demographics and hesitancy regarding immigration. This shortage is affecting the entire economy, as exemplified by a Kyodo survey indicating that 49% of Japan’s largest companies are lacking staff. Additionally, bankruptcies caused by staff shortages have more than doubled in the first six months of this year compared to the same period in 2022, according to Tokyo Shoko Research.
Versions of this crisis can be seen everywhere, including unsettling examples. The Japan Society of Civil Engineers is concerned about a significant national deficit in bridge and tunnel expertise in a country known for its hills and valleys.
For now, a considerable portion of Japan’s consumer-facing industries is engaging in a complex charade reminiscent of corporate gamesmanship. After years of deflation and diminished pricing power, Japanese food companies have become masters of the dark arts of “shrinkflation,” reducing product quantities while maintaining familiar packaging sizes. Although this practice is not exclusive to Japan, the reluctance to raise prices has made it a deeply ingrained habit in the country.
Grumpy Japanese websites meticulously document the ways, measurements, and timelines in which shrinkflation has impacted favorite products, from reducing the length of beloved ice lollies to decreasing the number of cheese slices or chocolates in a pack. A popular joke revolves around Fujiya’s Country Ma’am chocolate chip cookies, predicting that each cookie will be smaller than a Y1 coin by 2040 if current rates of shrinkflation persist.
Shrinkflation relies on maintaining visual consistency in packaging to meet customer expectations while delivering less. It postpones the need for a fundamental change in the customer relationship for as long as possible.
Japan’s service sector, which includes 24-hour convenience stores, well-staffed shops, ubiquitous vending machines, and incredibly punctual trains, seems destined to play a dual role in the shrinkflation game. While businesses in other countries may accept delivering worse service based on circumstances, Japanese companies are bound by their historical refusal to do so.
As far as possible, the outward appearance will remain unchanged, but Japan’s carefully perfected and promised experience will gradually diminish in small increments. This will manifest in shorter opening hours, longer queues, slower fast food, fewer train services, and more self-service checkouts. Eventually, a point will be reached where the decline can no longer be disguised.
When the product shrinkflation charade can no longer deceive, food companies resort to raising prices. Similarly, when service shrinkflation fails in Japan, a broader set of expectations must be reset in a society that has been accustomed to excellence.
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