Choshi Electric Railway: Turning Creative Ideas into Profit

Many railway companies have suffered during the pandemic, but the Choshi Electric Railway in Chiba Prefecture made a profit for the first time in six years in 2021. This is because 80% of their sales come from non-train operations, such as selling wet rice crackers, track ballasts, train sounds, auctioning station names and even producing a movie. Take a look at the unique ideas implemented by the company's president to keep the company on track.

Transcript

00:03

Choshi Electric Railway is a small rural railway that operates in Chiba, the prefecture next to Tokyo.

00:12

The person in the driver's seat is Mr. Takemoto Katsunori, the president of Choshi Electric Railway.

00:19

Due to a shortage of staff, he also drives the train.

00:29

On this day, Choshi Electric Railway held a market event on a JR station concourse.

00:39

Try our "nuresembei!"

00:42

They're savory and tasty!

00:49

Mr. Takemoto leads the way, working hard to attract customers and increase sales of the company's products.

01:05

At another time, he even produced and appeared in a film to promote the railway.

01:20

All of these efforts are to keep Choshi Electric Railway in operation.

01:27

We've always been committed to providing hospitality
to visitors and seeing them off with a smile,

01:32

hoping that they will return to Choshi area again.

01:42

In today's program, we take a look at Choshi Electric Railway

01:46

and the many difficulties it has overcome thanks to the president's unique ideas.

01:58

Located east of the Tokyo metropolitan area, facing the Pacific Ocean,

02:02

Choshi Electric Railway runs through Choshi City in Chiba Prefecture.

02:08

The 6.4 km private rural railway connects with JR at Choshi Station, the first station on the line.

02:18

Starting service in 1923, this year marks the railway's 100th anniversary.

02:30

In the 1950s, the former Japanese National Railways, now JR, operated direct service on Choshi Electric Railway.

02:41

Up until 1984, the railway also carried produce from along the line,

02:46

such as vegetables, seafood, and soy sauce, a local specialty.

02:53

Until around 1990, the railway served as a means of transportation

02:58

for locals as well as tourists visiting scenic spots along the line.

03:08

However, like many rural railways,

03:10

an increase in the number of people driving cars and a declining birthrate saw ridership fall.

03:17

The railway was in jeopardy of being discontinued several times.

03:33

Currently, the railway runs three two-car trains with a total of six cars.

03:39

The secondhand cars were acquired from other railway companies and were built over 50 years ago.

03:53

About 65 employees work here, who operate a food sales business in addition to its railway business.

04:06

At the forefront of the company is Mr. Takemoto Katsunori.

04:13

Starting at the railway in 2005,

04:15

he first worked as a tax accountant and as an advisor to the company's management.

04:23

When the company faced bankruptcy in 2012,

04:26

he was asked to take over as president to turn the company around.

04:36

The first thing Mr. Takemoto did was expand the food manufacturing and sales business.

04:44

When he became president,

04:46

one of Choshi Electric Railway's side businesses with consistent sales was "nuresembei,"

04:52

which they had produced and sold since 1995.

04:59

"Nuresembei" is a chewy, moist rice cracker flavored with soy sauce.

05:07

The "nuresembei" sold well, thanks to the support from railfans and tourists worried about the railway's survival.

05:14

I hope I can be a little help.

05:25

I know they're trying their best,
so I'd like to support them.

05:32

Seeing a business opportunity, Mr. Takemoto built a self-owned factory in 2014 to mass-produce the "nuresembei."

05:42

With two production lines, they produce more than 6 million rice crackers annually.

05:48

That's 20,000 per day.

05:58

To keep the company alive, we must focus on
something other than the railway.

06:05

In our case, it's the manufacturing
and sales of food products.

06:11

We saw an opportunity to compensate
for the deficit in the railway division.

06:19

In 2015, Choshi Electric Railway started selling the station naming rights to companies.

06:29

The original name of this station was Kasagami Kurohae Station.

06:34

In Japanese, the "Kuro" in "Kurohae" means "black."

06:39

The "hae" means "grow."

06:41

A shampoo company bought the naming rights and changed the station's name

06:46

to "Kaminoke Kurohae Station," which means "to grow black hair."

06:56

Currently, ten companies, including pharmaceutical and construction companies, serve as sponsors.

07:06

The station naming rights generate approximately 10 million yen in revenue annually.

07:16

In addition to its financial struggles, Choshi Electric Railway also suffered from a labor shortage.

07:23

So, in 2017, Mr. Takemoto obtained his train driver's license.

07:33

To reduce the burden on drivers, he works one to two shifts a week, driving the trains.

07:49

When Mr. Takemoto noticed a decline in "nuresembei" sales, he started developing a new product.

08:01

This snack released in 2018 is called "Mazuibou."

08:09

A parody of a famous Japanese snack, "Mazui" means "bad."

08:14

The name is a self-deprecating joke that encompasses both "bad taste"

08:19

and the "bad business condition" of the company at the time.

08:27

Try our "Mazuibou." Our business is in bad condition,
but the snack tastes good.

08:37

"Mazuibou" became a hit, and now sells 1 million units annually.

08:45

In addition to these two successful products,

08:47

Choshi Electric Railway has produced many food products using local ingredients.

09:01

These products are sold at Choshi Electric Railway's stations, directly managed shops, and on their website.

09:13

In 2020, the pandemic hit, affecting Choshi Electric Railway.

09:19

The company worried that their business, which had been gradually improving, would decline again.

09:31

However, the food sales business saved Choshi Electric Railway from the crisis.

09:36

Online sales increased as more and more people began working from home.

09:47

Since Mr. Takemoto became president in 2012, he has expanded the retail business,

09:53

making up for the deficit of the railway operation.

10:01

Of the company's approximately 530 million yen in revenue in 2021,

10:07

sales from the railway, the primary, business made up just 80 million,

10:13

whereas retail sales made up 450 million which is a 13.3% increase on the previous year.

10:30

Now, 85% of the company's revenue comes from food production and sales.

10:36

In 2021, for the first time in six years, the company made a profit.

10:47

On February 28th, Mr. Takemoto visited Choshi City Hall for the company's monthly business update.

11:03

In 2014, Choshi City established a support fund, utilizing donations from citizens,

11:10

to maintain the operation of Choshi Electric Railway and its various activities.

11:17

Assuming revenues are about the same as last year,
we expect to exceed 600 million yen at this pace.

11:32

Mr. Takemoto reported that retail sales were doing well

11:36

and that the company expected to make a profit again this year, following the previous year's success.

11:44

We couldn't have made it
without people's support.

11:47

Many people have purchased our goods online
and ridden our trains to support us.

11:56

Thanks to all of this, the company
was able to turn a profit.

12:06

I'm surprised that over 80% of the sales of Choshi Electric Railway are actually from food items such as the rice crackers.

12:13

At this point in time, it sounds like they're more like a food manufacturer with a side business of having a railway.

12:18

Actually Choshi Electric Railway has been like that for decades

12:23

so that means that the pandemic, especially the decreasing ridership didn't have as much of an impact

12:32

on the overall situation of the company as you might think.

12:35

Nevertheless it's really impressive to see the non-ticket sales of the company grow during the pandemic

12:41

pulling the company back to a profit.

12:43

Yes, since you mentioned tickets, I used to think I have to go to the railway,

12:47

ride the train, buy a ticket to support them but at this point in time, I can just buy goods.

12:51

Some of those goods are marked higher than a ticket

12:54

but I know it's something for me to take home or give my friends and at the same time, I'm supporting the railway

12:59

and I don't even have to go there, I can just buy it online as well.

13:03

Yes indeed.

13:04

Those various ideas plus the president of the company himself are making us want to support the company even more, really.

13:14

Yes, his passion definitely showed.

13:16

Naming rights, food items but there are many more bright ideas that the president has.

13:21

Let's go and find out what they are.

13:25

In addition to food, Choshi Electric Railway has planned and sold various railway-related goods.

13:34

These cans contain "railway stones" known as ballast.

13:39

Usually found beneath the track, the canned stones are sold as novelty items.

13:51

These, too, became a hit.

13:53

In addition, they also sell souvenirs that don't cost anything in materials,

13:58

such as cross-section slices of rails and dog spikes.

14:04

It's a trial-and-error process. We discontinue
the product if it doesn't sell.

14:11

We're willing to merchandise products
when we come up with any ideas.

14:19

In 2019, they began selling...

14:25

"railway sounds," such as trains running, crossings,

14:35

doors opening and closing, etc.

14:38

as ringtones through music distribution services.

14:43

Their slogan is "we're running out of things to sell, so we're selling sounds."

14:50

Also, they released a photo book of Ms. Sodeyama,

14:54

a train conductor who works at Choshi Electric Railway and is popular among railfans and passengers.

15:01

In total, they sold out 700 copies.

15:06

In addition to being a conductor, Ms. Sodeyama currently drives the trains as well.

15:17

President Takemoto aims to secure the railway by making Choshi Electric Railway the "most entertaining railway in Japan."

15:27

To that end, Mr. Takemoto produced a horror movie called "Don't Stop the Train" in 2020.

15:36

The movie's title reflects his determination to keep the trains running despite the crisis.

15:53

The film, which was shown nationwide, helped increase recognition of Choshi Electric Railway.

16:04

In 2022, he was asked by the local tax office to direct a short drama-style film.

16:17

The film, which was about properly paying taxes, was set on the now profitable Choshi Electric Railway.

16:25

The video aimed to promote tax awareness among citizens.

16:40

We were interested in the ability of Mr. Takemoto and
Choshi Electric Railway to disseminate information.

16:46

Therefore by collaborating with them, we thought
it would be a good PR for tax agencies.

17:00

Cheers!

17:03

Various special event trains, such as the "Beaujolais Nouveau Train"

17:12

and the "Theater Train" have been run by Choshi Electric Railway.

17:18

One of the most popular themed trains operated by Choshi Electric Railway is the "Haunted Train,"

17:24

which has run during the summer months since 2015.

17:28

Gaining attention in the media, the popular train has come to represent the railway.

17:34

It is now a summer tradition at the railway.

17:40

Recently, the railway has received many requests from companies in different industries wanting to collaborate.

17:50

This train, a collaboration with famous singer Kyary Pamyu Pamyu, has been running since 2022.

18:02

One of her signature songs is "Mondai Girl."

18:06

In Japanese, the word "mondai" means "problematic."

18:12

The collaboration is a response to the problems faced by Choshi Electric Railway.

18:21

Kyary Pamyu Pamyu designed the interior decoration to help people overcome their problems.

18:27

The train runs every day.

18:32

In addition, her voice can be heard making the onboard announcements.

18:38

"Thank you for riding with us.
This is Kyary Pamyu Pamyu."

18:42

"The train will run through the most popular
section called the green tunnel."

18:50

"At the front, we will see a fairy-take view,
as if we're running through a forest."

19:07

Choshi Electric Railway has also been able to attract visitors

19:11

through events held in collaboration with major game and animation companies.

19:21

We've been running many fun projects
and various event trains.

19:27

With new ideas, we are actively trying to attract
people who have never been to Choshi area.

19:38

On February 25, Choshi Electric Railway ran a special train to commemorate its 100th anniversary.

19:49

Twenty people from Tokyo and other areas participated in the event.

19:59

At Choshi Station, the nostalgic two-car train is waiting at the platform.

20:07

This event train is called the "Food Tasting Train."

20:14

It was created to promote the charm of Choshi City.

20:18

The idea is to enjoy the cuisine from local produce and scenery from the train.

20:29

Mr. Takemoto wanted to support the local economy which was affected by the pandemic.

20:39

At Nakanocho Station where Choshi Electric Railway is headquartered,

20:44

Mr. Takemoto boards the train with special boxed lunches.

20:52

These special bento boxes contain food made from seasonal local produce and freshly caught fish.

21:01

At this station, the owner of a seafood restaurant brings onboard sushi featuring mackerel caught at Choshi port.

21:16

And at this station, a local farmer boards the train to talk about locally produced cabbage.

21:24

To the right and left are my fields.

21:28

Surrounded by the sea, Choshi produces very sweet
cabbage with minerals brought in from the sea.

21:38

Next, the sushi chef brings out sweet omelets called "datemaki."

21:46

The "datemaki" from Choshi, which has a smooth and rich texture, is known as "Fisherman's Pudding."

21:58

Choshi's "datemaki" is made by sushi chefs. That's
why there is a sushi roll in the middle.

22:14

Then, to finish things off, an original local beer is served.

22:20

We brewed this beer to go well with fish from Choshi.
It retains the flavor and removes the smell of fish.

22:35

I didn't expect to be able to try so many
specialties of Choshi on the train.

22:43

The producers spoke directly to us and gave us
a better understanding of each food.

22:53

To take part in the event, participants were asked to promote the "Food Tasting Train"

22:58

and the tourist attractions of Choshi City on social media.

23:05

The aim was to promote the charm of Choshi and to attract more visitors.

23:15

If the region declines, the railroads
will also decline, and vice versa.

23:25

It is the mission of railroad companies, especially
rural railroads, to work together with communities

23:32

to prevent the further decline of the region by running
events and spreading information online.

23:46

I'm blown away by the president's ability to turn any ideas he has

23:51

into a business straight away and becoming an entertainment railway that it is now.

23:55

Who thinks of horror movies and trains together? It's brilliant.

23:59

And also the thought of what do we have here that we can sell,

24:02

what can we make that we can sell, what can we hear that we can sell.

24:06

That's clever.

24:07

Yes indeed and all the most it's surprising that many of these ideas come out during the pandemic

24:13

which probably would be the most difficult times for a company.

24:17

And I also saw that Choshi Electric Railway company is now becoming a hub of information for the local community

24:26

and behind the scenes is probably the determination or unity, if you like, of the local community to support Choshi Electric.

24:37

Yes, I think unity is a great word to also describe the Tasting Train.

24:41

It brings the passengers, the railway but also the locals all together

24:45

and then the locals can then talk about for example the cabbages that you're driving passed,

24:50

that they are making by themselves so it's a wonderful place to bring everyone together, like you said as a hub.

24:55

Indeed, I hope that through these efforts, Choshi Electric Railway will survive

25:02

and my personal hope is that through the efforts and through the survival,

25:06

Choshi Electric can get a facelift somehow

25:10

so that more modernized services can be provided to the passengers so that people,

25:16

more people I mean, want to use the railway line as their own day-to-day means of transport.

25:22

Of course not without losing too much of their entertaining tastes.

25:28

Yes!

25:30

Railway Topics.

25:35

On February 9, Kagoshima City welcomed its "Magma Yakiimo Tram."

25:40

While riding this streetcar, passengers can enjoy eating yummy sweet potato.

25:48

"Yakiimo," or baked sweet potato, is a delicacy in Japan during the fall and winter months.

25:57

On the train, four kinds of sweet potato from Kagoshima Prefecture are prepared for passengers to taste and compare.

26:06

The train, which had been out of action for two years due to the coronavirus pandemic, attracted many passengers.

26:16

Please enjoy riding the tram filled
with Kagoshima's charms.

26:23

We hope visitors would experience
and spread the word.

26:28

The Magma Yakiimo Tram runs through Kagoshima City in about an hour.

26:39

On February 14, at Tosa Kuroshio Railway's Gomen-Nahari Line's Train Depot in Kochi Prefecture,

26:47

a train was decorated to promote Japan's "Hinamatsuri" or Girl's Festival.

26:55

Traditionally, "Hinamatsuri" is dedicated to praying for girls' health, growth, and happiness.

27:02

It is celebrated by displaying dolls called Hina Dolls.

27:10

Each community has its own unique
and beautiful "hina" dolls.

27:15

This is such a great "Hinamatsuri" Train.

27:20

The "Hinamatsuri Train" ran until March 5.