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    Japanese c-stores offer fresh veggies to compete with dollar stores; Taiwanese 7-Elevens cash in on Hello Kitty.

    TOKYO -- When an operator of 100 yen shops (similar to dollar stores) began selling perishable foods five years ago, it did a lot more than boost revenue -- it sent a jarring wake-up call across three retail sectors.

    However, Ninety-nine Plus Inc.'s successful encroachment into supermarket space has sparked reprisals, according to the Asahi Shimbun newspaper.

    Some convenience store chains have opened fresh-food outlets, modeled after 100 yen shops, while supermarkets are staying open longer, with more and more of them operating around the clock.

    Ninety-nine Plus, spun off from a supermarket chain operator in 2000, runs about 580 Shop 99s, mainly in Tokyo and surrounding areas.

    In addition to household sundries that 100 yen shops specialize in, a variety of perishable foods -- from meat and fish to vegetables and fruits -- are sold in small lots for 99 yen, excluding consumption tax.

    The company, based in Kodaira, western Tokyo, projects consolidated sales of 122 billion yen for the current fiscal year, up 70 percent from the year ended in March.

    The fiscal 2004 sales of 72 billion yen more than doubled from two years earlier.

    The company's success derives from demand in urban areas from consumers who live alone and want to buy perishables in small amounts.

    Another factor is an increasing number of people who purchase vegetables late at night after most supermarkets and greengrocers are closed.

    Ninety-nine Plus is no longer alone in the niche it created, however.

    Convenience store operators are setting up chains of fresh-food outlets with comparable pricing.

    The companies are targeting housewives and middle-age and older consumers in an attempt to expand their customer bases, which are primarily people in their 20s and 30s.

    A broader customer base is critical for convenience stores whose average same-store sales have fallen year on year for nine straight months through April.

    Lawson Inc. in May launched its first 100 yen shop, dubbed Store 100, in Tokyo's Nerima Ward. Fresh food packed in small portions occupy about 10 percent of shelf space.

    Lawson aims to increase the number of 100 yen outlets to between 700 and 1,000 by the end of February 2008.

    Another convenience store operator, am/pm Japan Co., opened its first one-price outlet in Tokyo's Meguro Ward in March. The shop sells vegetables and fruits for a tax-exclusive 98 yen per package.

    Three F Co., a Yokohama-based convenience store chain, has opened four q's mart outlets with a line of perishables in Kanagawa Prefecture since December 2003.

    In other international news, in Taiwan, Hello Kitty, that ubiquitous symbol of cuteness, is using her enduring feline appeal to win customers young and old once again.

    This time the benefactor is the 7-Eleven chain, which is offering coin-sized, three-dimensional badges of Hello Kitty in 31 different poses -- on a bike, making a wish and riding a shark, among others -- to people who spend more than NT$77 each visit to the convenience store.

    Since the campaign began early last month, sales are 20 percent above their level a year ago, said company spokeswoman Lily Lin.

    By the time the promotion ends in the middle of next month, more than 100 million badges will be given away -- or four for every one of the nation's inhabitants, the company predicts.

    Locked in intense competition with at least three other major convenience store chains, 7-Eleven chose a proven winner to boost sales.

    Hello Kitty, created in 1974 by Japanese designer Yuko Shimizu of Sanrio Co., has an almost cult-like following across Asia, including the Philippines, Taiwan, Japan and China.

    There aren't many consumer segments where the Kitty doesn't pop up. She adorns clothing, house wares, cosmetics, jewelry, toys of all sorts, paper goods and electronics ranging from waffle irons to computers.

    The character's appeal spans all ages, particularly among girls and women. But men buy Hello Kitty products too, often as gifts for their daughters, wives or girlfriends.

    Seven-Eleven, a franchise owned by President Chain Stores Corp, paid Sanrio a fee for the use of Hello Kitty image but declined to disclose the amount, Lin said.

    Taking note, rival convenience stores Family Mart and Hi-Life are considering fantasy character campaigns of their own, featuring stalwarts like Snoopy or Doraemon, the blue-and-white Japanese character with a pocket on his stomach, another popular character in Asia.

    But Hello Kitty seems to occupy a special place in the nation's retailing tradition.

    Four years ago, McDonald's stores sparked a frenzy by giving out Hello Kitty dolls -- and matching samples of her boyfriend Daniel -- attracting long lines of customers outside its restaurants.

    More recently a bank encouraged new business by putting the Hello Kitty image on its credit cards, and several department stores featured her on their shopping bags.

    But this year's 7-Eleven promotion seems to be the biggest one of all, with enthusiastic fans exchanging Hello Kitty badges on the Internet and attending collectors' meetings to fill in missing pieces.

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