REVIEW OF OPERATIONS—NON-TRANSPORTATION
STATION RENAISSANCE— CREATING NEW STATION ENVIRONMENTS FOR THE 21st CENTURY Since establishment, JR East has moved decisively to leverage the potential synergy of its business resources such as high-traffic stations and adjacent commercial spaces. Creation of convenient and attractive retail-store, restaurant, office, hotel and other facilities will deliver sustainable revenue growth and complementary business diversity.
Shopping Centers & Office Buildings In April 2002, JR East and Tokyu Corporation jointly opened the JR Tokyu Meguro Building. A subsidiary of JR East is renting out office space and operating a shop- ping center there.
Station Space Utilization JR East continued its efforts to improve the attractiveness and earning power of its stations. Tsudanuma and Asagaya stations were enhanced through Cosmos Plan initiatives implement- ed in November 2002 and May 2003, respectively. Sunflower Plan initiatives were imple- mented at 67 stations, including Mejiro, Osaki, Sakuragicho, Hashimoto and Hachinohe.
32 EAST JAPAN RAILWAY COMPANY ANNUAL REPORT 2003 Cosmos Plan Shops/ Convenience Introduced in December 2000, the Cosmos Plan involves com- Convenience Restaurants store prehensive reviews of existing operational facilities at stations where passenger numbers are in excess of 200 thousand per day and major terminal stations in prefectural capitals. In addi- tion, substantial new station spaces are being newly created through various methods, including the construction of artificial ground. Sunflower Plan Ticket gate Commercial Launched in fiscal 1998, the Sunflower Plan mainly targets sta- space tions with passenger numbers generally in excess of 30 thou- Station sand per day. Activities include partial reviews of operational Artificial office facilities at and around stations and short construction sched- ground ules with minimal investment to develop stores. STATION RENAISSANCE
OPERATING REVENUES
9% 7%
14%
(Millions of Yen) 2002 2003 Station Space Utilization 368,553 368,961 Shopping Centers & 165,276 170,321 Office Buildings Other Services 219,950 225,955
OPERATING INCOME
5% Other Services 13% In the year ended March 31, 2003, 8% two new hotels were added to the HOTEL METS chain: The HOTEL METS Kamakura-Ofuna and the HOTEL METS Hachinohe. The Metropolitan Hotel chain was also (Millions of Yen) 2002 2003 enhanced by the addition of an Station Space Utilization 26,810 28,135 annex, East Wing, to the Hotel Shopping Centers & 38,494 43,519 Metropolitan Edmont. The HOTEL Office Buildings METS chain caters mainly for busi- Other Services 16,084 17,458 ness travelers, while the Hotel Metropolitan chain consists of Notes: 1. Percentage is a ratio of the year ended March 31, 2003. 2. Operating revenues mean operating revenues from outside customers. city hotels. (Photo: Transportation News Co., Ltd.)
EAST JAPAN RAILWAY COMPANY ANNUAL REPORT 2003 33 Review of Operations—Non-Transportation
STATION SPACE UTILIZATION
OVERVIEW TOPICS Ueno Station Renewal Project—First- Stations, where 16 million passengers Development Status of Sunflower Plan year Results embark each day, are JR East’s most and Cosmos Plan First-year sales in atré Ueno, the new shop- important business resource. JR East runs a Under the Sunflower Plan, JR East carried ping center created through the refurbish- wide range of businesses, including retail out a total of 296 development projects ment of Ueno station, exceeded targets. outlets and restaurants, to enhance the covering an aggregate area of 240,000m2 There has also been a clear synergy effect, convenience and comfort of station users between fiscal 1998 and fiscal 2002. In including increased revenue from sales of and increase its profitability. It is continual- fiscal 2003, it undertook projects at 67 short-distance passenger tickets at Ueno ly working to make its stations more attrac- locations, including Mejiro station, Osaki station. Station users say that the station is tive by developing new types of stores to station, Sakuragicho station, Hashimoto brighter and easier to use since the refur- meet a wide range of consumer needs. station and Hachinohe station. These proj- bishment, while local business owners say JR East is dynamically creating synergies ects covered a total area of 13,000m2 and that the district around the station now between its railway and non-transportation resulted in the opening of a wide range of attracts more people. operations through in-depth reviews of its new retail outlets. Before the launch of the station layouts under the Station Renaissance Sunflower Plan, there were commercial Restructuring of Retailing and program. The volume of traffic through developments at only about 30% of sta- Restaurant Operations many of JR East’s stations indicates that tions used by over 30 thousand passengers Another target for restructuring is the retail- there is a considerable scope for the devel- per day. The ratio is now in excess of 90%. ing and restaurant operations. Convenience opment of consumer-oriented services. For The Cosmos Plan was devised as a store operation is an extremely promising example, in the year ended March 31, 2003 framework for larger-scale development proj- business format, and JR East is already one (fiscal 2003), JR East had 32 stations used ects. The first to be renovated was Ueno of the industry leaders in terms of average by over 200 thousand passengers a day, and station, which is used by 372 thousand pas- daily turnover. However, management of 54 stations used by between 100 thousand sengers per day. The upgrade was complet- the convenience stores was previously and 200 thousand passengers per day. ed in February 2002. JR East continues spread among various group companies. In with similar projects in central and subur- fiscal 2002, the business was restructured ban Tokyo. Among them were projects at under the trade name NEWDAYS, and oper- Tsudanuma station, completed in November ating efficiency has been improved through 2002, and at Asagaya station, completed in the integration of merchandise flows, logis- May 2003, which serve 209 thousand and tics and systems, so the pace of store 88 thousand passengers daily, respectively. development can be expected to accelerate.
Tsudanuma station