EXPERIENCE HELPED CHAINS ENDURE QUAKE

KOJI HIRANO

KOBE, Japan (FNS) -- Despite suffering heavy losses, Japan's major retail food chains sprang into quick action following last January's devastating earthquake here and kept supply chains open.

Operators including Daiei, Jusco Co. and Ito-Yokado Co. persevered by relying on alternate distribution centers and advanced systems. Many rose to the occasion by providing relief and donations to hardest-hit areas. Chains were partly putting into practice

lessons learned during recent disasters.

Leading the pack was Kobe-based Daiei, the nation's largest supermarket chain and retailer, which was expected to post annual sales of about $25.6 billion in the year ended Feb. 28. The company's operations suffered damages of about $500 million, including ruined stocks, according to company estimates. Some 11 units still aren't operating because of the earthquake.

The company leveraged its huge national distribution potential to funnel merchandise into the affected areas. "We have wide distribution channels," said Kazuyo Nishimura, senior staffer at the company's office of Secretary, Research, Assessment & Public Relations. "We have more than 350 shops all over Japan, and can gather merchandise for the disaster area by using the network. There are four Daiei distribution centers in the area which suffered from the quake. But the distribution for the time being has been covered with the help of other centers."

Soon after the earthquake struck Jan. 17, the company sent some 300 supervisors from across the country to the devastated area. Executives also arranged for alternate transportation for shipping product, which soon led to the arrival of water and rice into the affected areas. Jusco Co., one of the nation's major retail chains with 192 units, said 40 stores were damaged and four destroyed. The company chartered trucks from other areas to ship merchandise into the problem sectors. The retailer also supplied imported mineral water to the crisis areas.

Another leading retailer, Ito Yokado, raised $7 million in aid from its divisions, which include 7-Eleven Japan. The funds were sent to the Hyogo office of the Japan Red Cross, which serves the disaster areas. Ito Yokado, which operates food and general merchandise stores, also offered $700,000 worth of merchandise in a move to spur the relief effort, said a chain official.

The chain also kept a distribution center open 24 hours a day in the Chukyo area (halfway between Tokyo and Kobe) to maintain distribution routes.

The Japan Chain Stores Association, a major organization of retailers, also worked hard in the relief effort. Member stores contributed food and clothing, which was sent to stricken areas on eight trucks the day after the quake.

The preparedness of Japan's chains was improved by their experience in recent disasters. "We learned a lot from the big earthquake [which took place in northern Japan] at the end of last year," said the Ito-Yokado official. This executive noted that the chain was prepared with the correct merchandise and other resources.