Masatoshi Ito, the billionaire who expanded a small family-owned shop into one of Japan’s largest retailers and took 7-Eleven convenience stores global, has died. He was 98.
(Bloomberg) — Masatoshi Ito, the billionaire who expanded a small family-owned shop into one of Japan’s largest retailers and took 7-Eleven convenience stores global, has died. He was 98.
Ito passed away on March 10 due to old age, the company said in a statement Monday, confirming earlier reports by local media.
Although his Ito-Yokado stores, which offered one-stop shopping for things from groceries to everyday clothes, lost their luster long ago, Ito’s legacy continued in the 7-Eleven franchise. The company he founded, Ito-Yokado, was the predecessor to 7-Eleven operator Seven & i Holdings Co.
There are more than 83,000 7-Elevens dotting the globe, with about a fourth of them in Japan. Ito was the company’s largest shareholder, amassing a net worth of $5 billion, according to the Bloomberg Billionaire’s Index.
Sometimes called the Sam Walton of Japan, Ito was known for a decentralized business style that was influenced by his long friendship with famed management consultant Peter Drucker, who once described Ito as “one of the world’s outstanding entrepreneurs and business builders.”
Starting Small
Ito-Yokado traces its origin to the “Yokado Clothing Store” that Ito’s uncle, Toshio Yoshikawa, opened in Asakusa, Tokyo, in 1920. Ito’s half-brother, Yuzuru, took the lead in expanding the business but died in 1956, and Ito took it over. He later renamed it Ito-Yokado and took it public in 1972.
The retailer continued to expand, including establishing Denny’s Japan Co., which brought the US-based casual restaurant chain to the country. A younger executive at Ito-Yokado, Toshifumi Suzuki, discovered 7-Eleven during a visit to the US to negotiate that deal.
After forging a deal with Texas-based Southland Corp., then-owner of the 7-Eleven chain, Suzuki opened the first outlet in Japan in 1974. That business would eventually outgrow Ito-Yokado’s general merchandising segment; in 1991 the company acquired Southland’s equity.
In 1992, Ito resigned from his post at Ito-Yokado to take responsibility for alleged payments by company officials to three “yakuza” gangsters to keep order at a shareholders meeting.
Suzuki succeeded Ito as president, later becoming chairman and chief executive officer. He renamed the business Seven & i Holdings in 2005, and 7-Eleven Inc. was made a wholly owned subsidiary. Ito remained as honorary chairman of the parent company, with the “i” in the name referring to Ito-Yokado and his last name.
Seven & i became one of Japan’s largest retailers. In 2020, it agreed to buy about 3,900 Speedway gas stations and stores from US-based Marathon Petroleum Corp. for $21 billion, at the time its biggest-ever deal.
On the urging of an activist shareholder, Seven & i is streamlining its business. In November, the retailer announced the sale of its Sogo & Seibu Co. department stores for an enterprise value of about ¥250 billion ($1.8 billion) to Fortress Investment Group. Last week, Seven & i said it will close roughly one out of every four of its Ito-Yokado stores in Japan.
Read more: Seven & I Closing Some Legacy Japan Stores After Activist’s Push
Military, Management
Ito was born on April 30, 1924, in Tokyo. His father, Senzo, and mother, Yuki, were merchants who sold pickled vegetables and dried food. Ito wrote in his autobiography that while his father was a “libertine” who seldom showed up at work, his mother was a true merchant. (Yuki eventually divorced Senzo, who was her second husband. Ito didn’t attend the funeral when he died.)
After graduating from Yokohama commercial vocational school in 1944, Ito joined Mitsubishi Coal and Mining, forerunner of Mitsubishi Materials Corp. He was drafted into military service and had trained to be part of a suicide squad to attack enemy ships when World War II ended. Soon after the war, he quit Mitsubishi and joined the family business.
His friendship with Drucker was cemented at Claremont Graduate University in California in the Peter F. Drucker and Masatoshi Ito Graduate School of Management, to which Ito donated $23 million.
Their relationship began in a “client-consultant mode,” but evolved into “long evenings discussing the world economy, the Japanese economy, and the direction in which Mr. Ito should be planning,” according to the school’s website.
Drucker believed in a decentralized method of running businesses. Ito followed his advice, setting up his company in autonomous units in charge of businesses such as supermarkets, department stores and convenience stores.
“He credits me, quite undeservedly, with a lot of his success,” Drucker was quoted as saying.
Ito and his wife, Nobuko, had three children, Yasuhisa, Hisako and Junro. One of his sons, Junro, became an executive at Seven & i.
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