A Success Story

Success Story

Devender S Narang Pooja Mishra Shoibhit Sahai

Jitendra N Patel Satish J Patel Vikram Chaliyawala

BENIHANA OF TOKYO An Insight

Americas first Japanese Steakhouse Introduced Hibachi table cooking Idea

Pioneered by Hiroaki (Rocky) Aoki in 1964

Established chain of 15 restaurants (Gross turn over $12 million / year ).

BENIHANANA OF TOKYO: Journey

15 No. Of Restaurants

1 1964

2 1966

3 1967 1972

Turn Over(Million $)

12

0 1964

1.3 1967 1972

BENIHANANA OF TOKYO: Planning

Market Opportunity
Three

years of extensive market research

American

liking for taking food in exotic surroundings Mistrust of Americans on exotic food Availability of Labour & High Labour cost

Innovations and Creativity

Authentic

historical Japanese surroundings Hibachi style of cooking in front of guests

BENIHANANA OF TOKYO: Concept Evolution

Operating Strategies Reduction of overhead expenses Fixed menu to eliminate wastages Reduction in food storage area

Optimal Manpower requirement One chef and one waitress caters to two dining tables Simple organisational structure Employee incentives Experienced Japanese Chefs were provided with six months training on Americas mannerism Customer Satisfaction Express service Quality of Food

BENIHANANA OF TOKYO: Concept Evolution

Site Selection and Design

Located in high traffic area with easy access to residential and commercial complexes Floor Plan to maximize dining area

Quick Decision Making

BENIHANANA OF TOKYO: Advertising Strategies

Advertised experience rather than restaurant

Converted cooking business to show business

Introduced communal dining concept

New conceptualization via print media

BENIHANA OF TOKYO: Comparison

Benchmark Labour Cost (as % of Operating Expenses) 30-35 Benihana

Food Cost (as % of COGS)

Beverage Cost (as % of COGS) Rent (as % of Operating Expenses) Promotion (as % of Operating Expenses) Construction cost

38-48
25-30 05-09 0.75-2.0 Lower

BENIHANA OF TOKYO: Comparison

Benchmark Labour Cost (as % of Operating Expenses) 30-35 Benihana

8-10

Food Cost (as % of COGS)

Beverage Cost (as % of COGS) Rent (as % of Operating Expenses) Promotion (as % of Operating Expenses) Construction cost

38-48
25-30 05-09 0.75-2.0 Lower

30-35
20 05-07 08-10 Higher

BENIHANA OF TOKYO: Hiccups

Discontinuation of Franchisee
Owners

lacking relevant experience Lack of Emotional Bonding Limited control over Franchises

Expansion Constraints
Scarcity

of skilled Japanese staff High construction cost

BENIHANA OF TOKYO: Recommendations

Use of Indigenous Construction material Expansion in Overseas through Joint Ventures Utilize unexplored potential market area Target other segments of market