Katsunori Takemoto: Choshi Electric Railway Runs for the Community

It's not that I want to be in the spotlight, but the company is on the verge of collapse, so I have no choice (laughs).

Recently, members of my local Kisarazu Mita-kai, who were worried about Choshi Electric Railway, chartered a train. I drove the train and acted as a DJ while providing guidance along the line. By DJ, I don't mean a disc jockey, but a "Don-biki Joke" [a joke that makes people cringe] (laughs).

The time I received the most help through Juku connections was in April 2013, when we established the "Choshi Electric Railway Operation Maintenance Measures Council" within Choshi City Hall to discuss whether the railway was truly necessary for the town. I presented a long-term management improvement plan for the next 10 years to experts from the local political and business worlds, and the chairman was Koichi Ito, an alumnus of Keio Senior High School.

Yes. He is a very distinguished person and was the chairman of the Choshi Chamber of Commerce and Industry at the time. He currently serves as a member of the Chiba Prefectural Public Safety Commission. He is truly a local dignitary.

The vice-chairman was Masanobu Sakamoto, who is also an alumnus of Keio Senior High School. After working for a major trading company and serving as a city council member, he is now the vice-chairman of the National Federation of Fisheries Co-operative Associations and the head of the Choshi Fisheries Cooperative. He is probably the only head of a fisheries cooperative with an MBA (laughs).

I first visited Choshi Electric Railway in February 2005. A lawyer I know was the legal advisor for the company, and at that time, the company had fallen into a very difficult situation. In fact, the previous president had been arrested for professional embezzlement the year before. Although the debt was created by the president, because it was embezzlement, the company had to take responsibility for it. So, I was asked, "We don't have an accounting expert. Can you help us?"

That's right. They said, "We have to file for bankruptcy, but we don't even have the deposit money to pay the court."

Initially, I seriously created a "Management Improvement Plan." Since they hadn't received loans from government-affiliated fiscal investment and loan institutions yet, I thought this was an opportunity. When I went to ask, the National Life Finance Corporation lent us 15 million yen, and another SME Finance Corporation lent us 55 million yen, for a total of 70 million yen.

I thought we could catch our breath, but the railway is a capital-intensive industry. Between fixing tracks and train inspections, the money disappears in the blink of an eye. Furthermore, the sleepers that had been left for a long time were rotting, and we had to repair signals, so in about six months, our operating capital was almost gone.

The mayor at the time was a former career bureaucrat and, of course, a capable person. Using his connections from his days at the University of Tokyo, he brought in an elite from the Development Bank of Japan with the title of advisor to Choshi City. In the fall of 2006, that advisor called the president and other executives and told them, "Show us a revitalization plan that is achievable right now." "Achievable right now"—there was no way we could achieve it while we were suffering. All I could do was comfort the distraught president and senior managing director by saying, "It's okay, I'm sure things will work out somehow."

"Nure-Senbei" itself had been on sale since 1995, but I rented a server myself and started online sales. At that time, I was still just a tax accountant and not even an outside director, but I worked hard to help sell the crackers whenever I had time. It's no use just looking at numbers and complaining; you have to increase sales. So, I went to help on various occasions.

When I would take a piece of cracker and hold it up to people passing by, they would open their mouths and eat it. When I asked, "Is it good?" they would say "It's good" unless it was really terrible. Then I would say, "If it's good, please buy it." I took advantage of the Japanese feeling of "if I've been treated, I must buy it" (laughs). This is called the principle of reciprocity. Another is logical consistency: "Is it good?" "Yes." "Then please buy it." "I'll buy it" (laughs). It was taste-test selling using these sales techniques.

There were days when we sold nearly 1 million yen worth. But that was just a drop in the bucket. Eventually, we were pushed to the point of borrowing money from the labor union. This couldn't go on. So, I wrote press releases to TV stations and others saying, "Please come and cover Choshi Electric Railway's final battle." But because it was "Nure-Senbei," it was damp and hard to catch fire (laughs).

In that situation, the words uttered by the accounting manager at the time were: "Please buy our Nure-Senbei. We have to earn money for train repairs."

This was it. While catchphrases like "the aroma of soy sauce with dashi" didn't catch on, this added the spark.

Later, when a Fuji TV news program broadcast the process leading up to the Nure-Senbei boom as a dramatization, the response was enormous. In that way, the words of the accounting manager led to saving Choshi Electric Railway.

That's right. "Please buy our crackers. For the train repairs" was no longer a catchphrase but a painful plea (laughs). This struck a chord with people nationwide. We received about 15,000 orders at the online shop. There were 1 million hits a day, and the server crashed.

We ended up with a backorder of about 10,000 items. We had to stop taking orders because we couldn't ship them anymore, and the people who placed the last orders received their crackers six months later. So, at the time, it was jokingly whispered on the internet as the "Nure-Nure Scam" (laughs).

Exactly. Even so, everyone watched over us warmly, and we were somehow able to recover in 2007.

By reducing debt and avoiding taxes, funds began to circulate somehow, and the president likely trusted me to some extent. I became an outside director at the next election of directors.

Actually, there was a period when the Nure-Senbei boom happened and we made an operating profit of 100 million yen. Since we continued to be in the black, I thought we were safe. We were even able to replace aging carriages.

However, the following year, the Great East Japan Earthquake occurred. Due to the impact of harmful rumors regarding the nuclear accident, there wasn't a single soul in the rotary in front of Choshi Station. During the Nure-Senbei boom, it was as crowded as the Yamanote Line, but after the earthquake, we started transporting air instead of people.

As a result, performance deteriorated rapidly, and eventually, the bank balance dropped to 500,000 yen. It's not like I was a single office worker. We had 200 million in debt. In that impossible situation, I ended up becoming president as a relief pitcher.

Right around this time, a wealthy individual from Choshi who served as the chairman of a company listed on the First Section of the Tokyo Stock Exchange established a general incorporated foundation in Choshi with his own pocket money and prepared 150 million yen. This was a foundation created to buy out Choshi Electric Railway.

Well, something like that. The previous president was against that idea. Actually, the vice-chairman of the foundation was the mayor of Choshi at the time, and he didn't get along with the previous president. He thought that if we came under the umbrella of this foundation, he would naturally have to resign.

However, the bank balance was only 500,000 yen. Thinking realistically, the board of directors decided that I should temporarily take over as president, press the seal about three times, and join the foundation.

But when I met the foundation executives, they said this money was for a newly established "New Choshi Electric Railway" and they had no intention of giving a single yen to the current Choshi Electric Railway. In short, they were thinking of implementing a revitalization scheme using a second-company method. And I was instructed to stop debt repayments immediately. I couldn't do that, obviously. I'm a tax accountant, after all. I'll avoid stating clearly why they were pushing things so hastily, but there were various circumstances...

In the end, this incurred the displeasure of our main bank. Thus, things settled into a direction of aiming for reconstruction through a standard approach over time. However, the foundation cut ties with us, saying, "You are too soft. We are pulling out." So I rushed to the SME Revitalization Support Council to work on long-term reconstruction, which leads back to the story of the "Choshi Electric Railway Operation Maintenance Measures Council" I mentioned at the beginning.

Yes. However, in the mayoral election immediately following, the mayor lost by a narrow margin, and the wind changed. The winner was a Keio University alumni, the incumbent Shinichi Koshikawa. He was in the same year as me and graduated from the Faculty of Economics.

Yes. I met the mayor and said, "Nice to meet you. We were in the same year at Keio," and since then, he has come to give greetings at various events. In that way, I have been greatly helped by Juku connections.

Then, in December 2013, Mr. Ito, the chairman of the Operation Maintenance Measures Council and a Keio University alumni, declared loudly, "I declare here that Choshi Electric Railway is necessary for Choshi." And although subsidies from Choshi City had been frozen for 10 years due to scandals, they reached the conclusion that they should be reinstated. Following the result of receiving aid from Choshi City, we were also able to receive subsidies from Chiba Prefecture.

Actually, just before receiving the subsidy from the prefecture, we had a derailment accident, but local high school students collected money through crowdfunding and donated 5 million yen. Thanks to that, the derailed carriage returned to service after 448 days.

Beyond the digital world, there is, so to speak, a warm analog heart. Choshi Electric Railway should exist for the community, and since it has an integrated relationship with the region, we will work hard with local support. I spend my days in that environment.

The population along the line is only decreasing. Tokawa, the last stop, had a population of 5,000 ten years ago, but now it's under 3,000. It's a marginal railway heading toward a marginal settlement. I can't exactly tell the locals, "Please ride more."

Exactly. By having many customers come from Japan and abroad, I want to contribute even a little to the local economy.

That said, if you ride it, you'll see there aren't many places you could call scenic spots along the line. Many people think it runs along the coast, but you can hardly see the sea. If that's the case, we have no choice but to launch various interesting projects and steer toward entertainment, so we're doing all sorts of silly things.

Yes. And it's not just any illumination, but all-pink illumination. Because pink LEDs were the cheapest (laughs). When it was broadcast on TV on the first day of operation, our employees were scolded on the phone for an hour, with people saying, "Isn't that indecent!" (laughs). But conversely, it became a hot topic and succeeded in attracting customers.

The "Haunted House Train" is 50 minutes round trip, and no getting off midway (laughs).

That's right. It's an attraction where you're told to "endure it." It's no longer a means of transportation (laughs).

About 600,000 sticks, around 25 million yen, so it's doing quite well. The release date was August 3rd last year—Bankruptcy Day [Ha-san no hi] (laughs). Since that's bad luck, we started sales at 18:18. To say "Bankruptcy, no no" [Ha-san, iya iya] (laughs).

They haven't returned much, but foreign tourists are increasing. In April the year before last, our company signed a sister-line agreement with the Su'ao Line in Taiwan. It's in a similar location to Choshi, about two hours from the capital, and has many similarities. We made it so that if you show a ticket used on the Su'ao Line, you can ride Choshi Electric Railway freely for a day.

Recently, a group of female college students from there came. I drove the train to Tokawa, and they were overjoyed, which made me very happy.

I thought I should obtain a driver's license from a customer's perspective as well, so I obtained what is called a Class A Power Vehicle Operator's License. It's a national qualification that allows you to drive anywhere with training.

Is that so? Empuku-ji also gives us donations for every event, and they are always helpful. This month, we are releasing a "Choshi Electric Railway Goshuin-cho" [stamp book] and a charm called "Hibikore Hensai" [Every Day is Repayment] that expresses our earnest feelings, and the chief priest gave me advice on those as well.

We can't survive if we just do ordinary things, so we are trial-and-erroring to establish a new pillar of revenue. "Nure-Senbei" is, of course, a core product and sells stably, but this alone cannot fill the deficit of about 30 million yen. Furthermore, the substation is aging, so it will cost 200 million yen for repairs in two years.

For that reason, I'm currently thinking of making a movie. A big hint is "One Cut of the Dead" [Kamera o Tomeru na!]. It had a production cost of only 3 million yen but box office revenue of 3.1 billion yen. As an original movie with respect for "One Cut of the Dead," I thought "Don't Stop the Train!" [Densha o Tomeru na!] might be good (laughs). Because it's about to stop. Since it's on the verge of being discontinued, I'll put my earnest feelings into it.

Actually, I'm thinking of trying the world's first fusion of a real movie theater and a train movie theater.

Yes. I'll make it so that people are about 98% satisfied with the screening in the movie theater, but leave a little bit of a strange feeling, so that they'll think, "If I want to see the rest, I have to go to Choshi Electric Railway." A "laugh-shocking" conclusion awaits there (laughs). Having many people come to Choshi will also lead to regional contribution.

In the world's first train movie theater, you'll understand that "actually, it was like this" during the 19 minutes to the final stop. If we get the same box office revenue as "One Cut of the Dead" with this, we'll be safe for 100 years (laughs).

Also, could Keio University do a naming rights deal for the company name "Keio Electric Railway"? (laughs). For one year, I'll call myself "Takemoto of Choden, also known as Keio Electric Railway."

At the same time, I'm looking for a new father—that is, a parent company. If there are any wealthy individuals in the Juku, please consider us (laughs).