Saturday, March 25, 1989.
Early morning in Tokyo was shrouded in a thin layer of cold mist. Newspaper deliverymen rode Honda Super Cub motorcycles, exhaust pipes puffing white smoke as they weaved through the quiet residential streets of Setagaya Ward.
Thwack.
A thick copy of the Yomiuri Shimbun was stuffed into the mailbox at the Sato residence.
A few minutes later, Mrs. Sato, wrapped in a wool shawl, pushed open the door and retrieved the newspaper, her breath visible in the cold air. She habitually shook the newspaper, trying to dislodge the colorful supermarket promotion flyers tucked inside to see which store had cheaper rice and soy sauce today.
Her movements stopped.
There were no colorful flyers today.
Wrapped around the outermost layer of the newspaper was a high-quality coated paper advertisement, even thicker than the main issue.
It didn't use cheap red-and-yellow explosion stickers, nor was it filled with dense rows of price figures.
The entire layout was designed in a minimalist cream-white tone.
In the very center was a high-definition wide-angle photograph: Under warm lighting, light-colored wooden shelves were neatly arranged. Warm-toned track spotlights cast soft circles of light, illuminating products displayed like works of art. A clerk in a clean uniform smiled as they handed a brown paper bag full of fresh vegetables to a customer. In the background, an open kitchen steamed with heat, and golden-brown croquettes shimmered enticingly in a glass display case.
Above the photo, a line of bold, powerful black Mincho-style kanji characters was printed:
Consumption Tax? We'll Pay It for You.
There was no convoluted phrasing.
These few words were like a fastball, slamming hard into the retinas of every reader.
Below was a line of slightly smaller explanatory text:
S-Mart (Saionji Supermarket) & Uniqlo Solemnly Promise: Starting April 1st, all products will maintain their original prices. Say no to 1-yen coins; say no to tedious calculations.
Life should be leisurely; it shouldn't be weighed down by that 3%.
In the bottom right corner, a red square logo was printed alongside a bright red Saionji Family crest.
Mrs. Sato rubbed her eyes.
She looked at the place in the photo that appeared more refined than a high-end department store in Ginza, and then at that simple, blunt promise.
"No price hike? Paying the tax for us?" her voice sounded a bit airy in the early morning wind, trembling with disbelief. "Such a beautiful place... can they really be this conscientious?"
9:00 AM.
Koto Ward, Daiei Group Headquarters.
The door to the President's office was tightly shut, but the roaring coming from inside could be heard clearly even by the secretary at the end of the hallway.
"Bastard!"
With a loud crash, an expensive crystal ashtray flew toward the corner and shattered into pieces. Glass shards sprayed across the carpet, reflecting the gloomy daylight from outside the window.
Isao Nakauchi stood before his desk, his chest heaving violently. He clutched that copy of the Yomiuri Shimbun tightly, the newspaper already crumpled into a ball.
"Saionji Shuichi... and that little girl!" Isao Nakauchi's eyes were bloodshot.
He looked at the row of executives standing before him. Every one of them had their heads bowed, staring at the tips of their leather shoes, not daring to make a sound.
"We just emptied our warehouses! We just had a fire sale of all our stock to avoid the inventory audit across the tax period!" Isao Nakauchi pointed at the newspaper, his fingers trembling. "And now they're telling me they aren't raising prices? They're going to pay the tax for the customers?"
"Then what are we? What was our month-long clearance sale like idiots for?"
A manager looked up timidly. "President, this is unfair competition. What they are doing is illegal. We can complain to the Fair Trade Commission..."
"What the hell good is a complaint!" Isao Nakauchi slammed his palm on the desk. "By the time those old farts at the Commission finish their process, April 1st will have long passed! By then, all the customers will be gone!"
He walked to the floor-to-ceiling window and looked down at the busy street below. The Daiei Supermarket sign swayed slightly in the wind, looking somewhat dated.
To prepare for April 1st, the Daiei Group had spent a fortune upgrading their checkout systems, prepared tons of 1-yen coins, and even trained cashiers on how to quickly calculate the 3% tax. They thought this was following national policy, that it was common sense in the retail industry.
But now, someone had flipped the table.
"Where do they get the nerve?" Isao Nakauchi gritted his teeth. "A 3% net profit is the lifeblood of the retail industry. Do they want to commit suicide?"
"President..." the head of the intelligence department hesitated for a moment before taking out a more detailed investigation report concerning this new species called S-Mart. "It's not just a matter of the 3%."
The intelligence head opened the report, displaying a set of surreptitiously taken photos.
The photos showed a new S-Mart store in Chiba Prefecture that had just had its construction barriers removed.
"We've discovered twenty such stores around the Tokyo periphery. All of them are converted from former abandoned factories or logistics warehouses. But..." the department head pointed at the interior in the photos. "They aren't using warehouse shelving. They've laid down wooden floors and used warm lighting. And there's that deli section, S-Kitchen."
"According to our informants, the croquettes and oden there use the latest recipes from S-Food's central kitchen. The prices are 10% lower than ours."
Isao Nakauchi snatched the photos, staring intently at the sales floor that felt high-end yet was marked with low prices.
The huge contrast between the visual high-end feel and the low prices filled him with an unprecedented sense of dread.
"This is impossible..." Isao Nakauchi's voice dropped. "With this kind of renovation standard, how are they controlling their costs? Are they really doing charity?"
"There's also the membership system," the department head added. "Only customers who have purchased a membership card can enjoy the 'tax-free' treatment. According to our observations on-site, even though they haven't officially opened yet, long lines have already formed just for the pre-sale membership cards."
Isao Nakauchi's body stiffened.
He spun around suddenly and slammed the crumpled newspaper onto the floor as if crushing an invisible enemy.
"This is complete madness!" Isao Nakauchi's voice was hoarse. A fear beyond common sense gripped his throat. "Using department store renovations to sell radishes, and scooping up money with membership cards before even opening..."
He gritted his teeth, a beast-like ferocity in his eyes.
"This is cutting off our retreat. If they succeed, the price advantage Daiei has built over decades will become a joke!"
"Get the car ready! To the Retail Industry Association!" Isao Nakauchi grabbed his coat from the back of the chair, draped it over his shoulders, and strode out. "If that fellow Yoshiaki Tsutsumi, who prides himself on being noble, sees his territory being swallowed by this neither-fish-nor-fowl entity, he'll probably be more anxious than I am!"