Rafu Will Continue Through 2017

Mark Nakakihara and Ellen Endo discussed changes they are implementing at The Rafu Shimpo. (J.K. YAMAMOTO/Rafu Shimpo)

By J.K. YAMAMOTO, Rafu Staff Writer

The Rafu Shimpo, which faced possible closure at the end of year due to declining revenue, will still be operating next year, the newspaper’s new management team announced at a public meeting held Sunday at the Go For Broke National Education Center in Little Tokyo.

“With all the changes that we’ve made over the last seven months, with many more coming up in the next two months, the owners of The Rafu Shimpo have agreed to continue with the paper through the year 2017,” said Mark Nakakihara, special consultant. “Hopefully, the changes that we made and the ones that we are making will keep the paper going for many years after that. This wouldn’t be possible without thanking the publisher, Mickey Komai, and his family for allowing us to make these changes.”

Nakakihara said he was brought on board because of his experience with UPS and other companies. “I’ve been running family-owned companies from both the sales and operations side. I report to and experience various family ownerships, from husband and wife, father and son, sister and brother, and single proprietors.

“My current company, NDS [Norco Delivery Services], is a family-owned California delivery service that’s been in business for the past 60 years. I’ve been with them for the past 20 years and currently serve as president. We have over 150 employees and approximately $12 million in annual sales. So I understand how families view their companies and feel that I can communicate with them on how to make their companies more profitable.”

Although the subscription drive launched earlier this year has produced results, he said, more needed to be done. “We recalculated the daily ad percentage with the printers, creating a lower postage rate classification. With an earlier print deadline … our mail is now fully automated, which is increasing the speed of delivery and an additional postage discount. We’ve created a new relationship with the printer for improved service. We also reduced the price with printing and also more flexible payment terms.

“We reached out recently to the community churches to announce their various ministry programs in our weekly directory and in return we’ve asked for voluntary contributions. We have a planned partnership with the mortuaries to lower the upcharges to their customers in order to increase the revenue to our paper. We renegotiated payroll and janitorial services to lower their cost by 50 percent. We reconfigured our phone services and our health insurance for significant savings.

“Soon there will be a new website that will have unique features. This will then attract more viewers and thus more advertisers to increase revenue. So in the end we’re trying to put out a new and better product.”

Daily Delivery

Nakakihara is also working with his contacts at the U.S. Postal Service to speed up delivery. “We are working on a process that will improve the daily delivery to all the local areas that are not receiving their paper on a timely basis. Our first project is in Orange County … looking at getting the 926, 927 and 927 zip codes delivered on the same day as the ones that are being delivered in Los Angeles.

“Unfortunately, we’re also looking for ways to mitigate the new USPS rate increase that’s going to happen on Jan. 22. This carries a possible 7 to 8 percent increase to our production, but we feel that with some of the changes that we’ve made, we are probably going to be able to mitigate these rate increases.”

Nakakihara said his company is doing some pro bono work for Rafu. “Once the paper gets delivered to the USPS’ main facility in Los Angeles, my drivers will then take that paper for Orange County and deliver it to the Orange County processing center that night so that it can be delivered to the Orange County post offices. My drivers will also take it to the Santa Clarita main post office so that the San Fernando Valley customers can be delivered on the same day as those in the city of Los Angeles. I’m going to see if that works before I go to San Diego or anywhere else …

“The Rafu Shimpo is actually on the Consumer Affairs with the USPS, so now all the postmasters in all regions … can make sure the paper is delivered on the mail carriers’ route that day. Today it’s actually considered junk mail, so that’s why it doesn’t get processed in time.”

Feeling Optimistic

Gwen Muranaka, English section editor-in-chief, recalled a similar public meeting held seven years ago after the two Nikkei newspapers in San Francisco went out of business, and said the news this time is more positive. “What’s happened in the last six months has been an unprecedented level of support from the community, and it shows how important an institution like The Rafu is to connect this community, bring us together … Our staff and volunteers were at almost every Obon festival this summer, reaching out.”

While the original goal of 10,000 subscriptions was not reached, she said, “we received 1,500 online subscriptions and for the first time in [20] years we actually had an increase in our paper subscriptions as well.”

Muranaka praised Nakakihara and former editor Ellen Endo, who is serving as interim chief operating officer. “What’s giving me hope is they’re saying, ‘We want to improve things for everybody. We want to make the paper stronger. We want to make sure the needs of the staff are looked at, that the work of the staff is appreciated.’

“It is still an ongoing process. We’re being asked to do a lot of things … to manage our time better, to look at ways to perhaps monetize things that we’ve never thought of doing before, so can we make ourselves more efficient.”

Noting that Little Tokyo community organizations are facing a generational shift and changes in leadership, she said, “Everyone’s going, ‘What’s going on with these institutions?’ But it’s also a moment of great opportunity and a chance to be very optimistic about where we’re going. We need the right people leading these efforts. It’s going to be a long road, but I feel more optimistic with the team that we have here that we’re going to get there.”

Revenue Sources

Endo — who, like Nakakihara, has been helping the newspaper pro bono — said, “I came to this, and so did Mark, not knowing whether or not we could even help … Now that we’re seeing results and seeing positive change, we know it’s worth it.”

While thanking the subscribers and advertisers who have supported the paper over the years, Endo detailed plans to find new sources of revenue. “We’re focusing on a dynamic online presence, something that will be more cutting-edge. We want to be able to do that smartly … We believe there is money to be made there and certainly a way to build the audience.

“The other thing we want to do is give advertisers a reason to advertise, so we’re working on themes or a focus … We have an anime team that came to us and offered to create an anime section, which is going to be very exciting. You’re going to be able to sort of a taste of it in the print edition, but you’re going to want to go, if you’re an anime aficionado, to the online to see the anime in high resolution …

“The other source of revenue is the digitization of the archives. The archives go back to the early 1900s … We want people to be able to access those archives for research … and be able to, for a small fee, maybe download or print … also to be able to word-search those files.

“We want to put some effort into investigative journalism, so we want to make sure that we’re on top of key issues that are impacting the community, things like the current election.”

Outreach to Advertisers

George Toshio Johnston, who has worked in both mainstream and ethnic media for nearly 30 years and is known to Rafu readers as one of the “Into the Next Stage” columnists, was introduced as the newly appointed sales and advertising coordinator.

Johnston also thanked Endo and Nakihara for their “time-consuming, energy-intensive but also very necessary and hopefully rewarding behind-the-scenes reorganization of The Rafu Shimpo’s business operations. Without them pushing, leading, executing, I’m certain none of these things … would have or could have taken place.”

He added, “I would not have said yes if I didn’t think there was a real chance for a turnaround at The Rafu Shimpo. I think the Nikkei demographic here in Southern California and nationwide is one that advertisers should covet … We’re well-educated, socially conscious, upwardly mobile, relatively affluent with good taste and as a group interested in goods and services advertisers want to sell …

“I want to start The Rafu’s outreach to new advertisers … I want to reach out beyond just the usual suspects when it comes to the type of ads that **Rafu** can carry. While there are our affinity-based advertisers who provide goods and services unique to our collective taste and specific needs … we also need to realize that while we might be predisposed to think ANA or JAL as advertisers for readers thinking of traveling to Japan, we also need to realize that Thai, Singapore, Korean Air as well as United and American Airlines also fly to Japan. Same for those folks who are interested in a luxury Inifniti or Lexus … why not Mercedes Benz, BMW, Lincoln and Cadillac as well?”

Describing the newspaper as “a brand name that means something to the Southern California Japanese American community as it chronicles “events in our community that bigger, general-interest newspapers simply can’t,” Johnston said, “The Rafu Shimpo is older than the span between now and the last time the Chicago Cubs won the World Series. I don’t know if they’re going to win … but just like them being in the running again, this is like a new beginning for us …

“There is no single solution, no magic bullet, no grand-slam home run or Hail Mary pass … that’s going to turn things around … It’s going to be a lot of little things and some bigger things that will hopefully lead us to that success. We have to try new and possibly unorthodox methods to turn things around.”

Building a Foundation

Nakakihara credited former staff member Jordan Ikeda for writing an article back in April to “wake up the entire community” to the possibility that Rafu might close. “If it wasn’t for that, I wouldn’t be here, I wouldn’t have met Ellen, and I think a lot of these changes wouldn’t have been made … For 20 years the number of subscribers has been declining, and after the article came out, after the community stepped forward, it was the first time in 20 years that the number of subscribers had increased. So that’s huge.”

Another major announcement from Nakakihara: “We are going to be creating a new nonprofit foundation that will be totally separate from The Rafu Shimpo. The name of the new nonprofit is still being approved by the Department of Corporations, but tentatively we’re looking to call it the Zentoku Foundation. Zentoku (善徳) in Japanese means virtue … doing the right thing.

“So we’ll have a new board of directors. I’ll be president. My experience as president of two large nonprofit organizations, SEYO [Southeast Youth Organization] in Orange County and Yonsei Basketball, will help in making this a very successful foundation. It’s still in the process, but Zentoku’s mission is going to be to provide community support, organization and networking, supporting Japanese American groups, organizations and individuals to help maintain, reconnect and revitalize the Japanese American community …

“We are very fortunate to have one of the best law firms in the nation who specialize in nonprofit foundations, called Seyfarth Shaw, based out of Chicago and Los Angeles. They’re putting together the Zentoku Foundation on a pro bono basis. They’ve seen the value that’s going … not only to The Rafu Shimpo but in helping the entire Japanese American community.

“We are days away from being approved, and so once that happens we will be able to announce it and we’ll be able to describe exactly what the process is going to be and how we’re going to be able to raise money for supporting The Rafu Shimpo.”

Unlike the existing Rafu Foundation, which does not benefit the newspaper, the new foundation will, he said. “We’ll be having specific fundraisers for specific events to raise money for the paper … There’s a fine line on what a nonprofit can donate to a for-profit corporation, so that’s the part that we’re working on.”

Asked if the newspaper itself might become a nonprofit, as The Nichi Bei Weekly did in San Francisco, Endo said that may happen “down the road” but is not being considered right now.