Read the passage about the changes to Japanese department stores and complete the paragraphs with the correct answer A–G. A so a merger serves as a convenient excuse to centralize B customers are deserting them in favor of C reorganize their operations and renovate their aging buildings D the value of the land on which its stores sit E the first building in Japan to have central heating and escalators F there were art galleries, restaurants serving foreign food G who cost less since they receive fewer benefits Consolidation beckons for Japan’s retail icons Once, Japan’s department stores were symbols of modernity. In 1673 Mitsukoshi, the oldest, introduced the then-radical innovation of fixed prices. At the turn of the last century, its flagship store was 1 ___ ; and one of the first big shops in the country to allow customers to wear shoes. Nowadays, however, depato, as department stores are known in Japanese, seem stodgy: 2 ___ specialty clothing stores and malls. Moreover, consumer spending is flat and the population is declining. Sales have fallen across the industry for a decade, and profits with them. Because productivity is low and operating costs are high, earnings are meager. Mitsukoshi, for one, has posted losses for six consecutive years. It is thought that 3 ___ is now higher than that of the company itself. No wonder, then, that the boards of Mitsukoshi and Isetan, the country’s fourth- and fifth-largest department store chains, laid plans for a merger that would create the country’s biggest retail group, with $14 billion in annual sales. The deal is seen as a way for Mitsukoshi to learn new tricks from Isetan, which is far smaller but profitable. Their rivals are doing the same. Combining forces is a way for stores to increase their buying clout with distributors. It can also help to promote broader restructuring. Branches are often run almost autonomously, 4 ___. Innovative practices from the better-performing stores can be rolled out across the business. Many big chains have shed permanent staff in recent years and resorted to temporary workers, 5 ___. But stores are still packed with too many employees serving too few shoppers. Department stores have the lowest productivity in the Japanese retailing sector. To catch up, Japanese department stores need to invest in IT, 6 ___, says Kentaro Mori of the Boston Consulting Group. This costs money—something they are short of. So the mergers are a way to attain larger scale and thus make these investments more affordable. The depato helped to spread Western-style, middle-class consumerism in Japan. Family visits at the weekend were as much cultural excursions as shopping expeditions: 7 ___ and shelves stocked with exotic products from around the globe. But unless a radical overhaul accompanies the current consolidation, the depato themselves will soon become curiosities.