SANKO MARKETING FOODS

Basic Information

Stock Code: 2762
Industry: Retail
Category Detail: Restaurants
Prefecture: Tokyo
Establishment Year: April 1977
Listing Year: March 2003
Official Website: https://www.sankofoods.com/
TSE Information: TSE Information
Yahoo! Finance: Yahoo! Finance
Other Companies: Other Diverse Competitors, AllAbout, Yakiniku Sakai Holdings, W Dish, DD Group, Kaifan, Chimney, Eternal Hospitality Group, SFP Holdings, Yoshix Holdings, Kushikatsu Tanaka Holdings, Watami, Area Quest, Daisho

Overview

SANKO MARKETING FOODS is a retailer headquartered in Shinjuku-ku, Tokyo, founded in 1977, that develops restaurant chain brands centered on private-room izakayas.

Current Situation

SANKO MARKETING FOODS recorded net sales of approximately 2.1 billion yen for the fiscal year ended June 2021, but posted substantial losses in operating profit, ordinary profit, and net profit (approximately 1.7 billion yen, 1.4 billion yen, and 1.8 billion yen losses, respectively). Its flagship brand is the private-room izakaya 'Kin no Kura Jr.,' along with diverse formats such as Touhou Kenbunroku, Tsuki no Shizuku, Tokyo Chikara Meshi, and others, operating 29 directly managed stores and 21 consignment-operated stores, totaling 50 stores. It faces intense competition in the restaurant industry with numerous rivals. In 2021, it changed its trade name and began international expansion by opening the first 'Tokyo Chikara Meshi' store in Thailand. It is emphasizing franchise expansion for private-room izakayas to strengthen the brand and expand its customer base. Moving forward, challenges include expanding overseas operations and rebuilding the business through improvements to existing stores. While advancing measures for financial health improvement, it aims to boost competitiveness through new business formats and differentiation of existing brands. It requires flexible management strategies responsive to the latest business trends and market needs.

Trivia

Interesting Facts

Pioneered private-room izakayas by opening 'Toriya Touhou Kenbunroku' in Shinjuku in 1998.
Founded as a teishoku restaurant 'Sankotei' under the Kanda bridge girders, which inspired the company name.
Featured in 2010 on TV Tokyo's economic program as a winner in the 270-yen izakaya wars.
Changed company name to English notation SANKO MARKETING FOODS in 2021 to emphasize international presence.
Holds numerous izakaya brands, with some expanding overseas via licensing.
'Kin no Kura Jr.' is known in the industry as the mainstay franchise brand.
Accelerating overseas expansion with Tokyo Chikara Meshi brand in Thailand and beyond.
Previously challenged diverse formats including pasta specialty store 'Tokyo Spaghetti.'
Main izakaya brands feature approachable pricing and private-room designs.
Competitors include Watami, SFP Holdings, Daisho, and others.
Founder Taira Hayashi has contributed to the restaurant industry for many years.
Head office in Takadanobaba, Shinjuku-ku, with registered head office in Nihonbashi Ningyocho, a rare dual-base setup.
Balances franchise and directly managed operations as a restaurant chain.
With paid-in capital of 50 million yen, relatively small-scale but pursues unique strategies.
In 2023, established fisheries and aquaculture-related company to strengthen food resource involvement.

Hidden Connections

Asahi Beer holds a major shareholder position and collaborates on beverage planning.
Multiple same-brand eateries still exist near the site of the founder's original 'Sankotei.'
Occasionally shares industry information with competitors like Watami and SFP Holdings.
Business collaboration advancing with Thai licensee partner ON AND ON GROUP.
Multiple investment securities firms listed in shareholder composition, indicating high market attention.
Store name 'Touhou Kenbunroku' derives from a historical book, adding depth to brand image.
Dual head office and registered office setup utilized for funding and operational efficiency.
Former 'Tokyo Spaghetti' brand represents a nationwide new format challenge.

Future Outlook

Growth Drivers

Market share growth from expanding demand for private-room izakayas
Acceleration of overseas store expansion centered on Thailand and Asia
Brand expansion through strengthened franchise business
Customer acquisition via health-oriented menu development
Operational efficiency and customer convenience improvement through digital technology adoption
Advancing diversification and differentiation strategies via new formats
Increased repeat customers through enhanced community-focused services
Strengthened initiatives for sustainable management
Steadfast efforts toward business reconstruction and financial health
Flexible management policies responsive to changes in dining-out environment

Strategic Goals

Expand stores to over 150 domestically and internationally
Improve overseas sales ratio to over 20%
Achieve sustainability standards across all stores
Improve operational efficiency by 30% through digital shift
Increase franchise sales composition to over 50%
Maintain annual launch of 2 or more new formats
Continuously improve employee satisfaction
Double annual participation in community contribution activities
Achieve 40% ratio of health-oriented products in menu development
Realize stable profitable operations through strengthened financial position

Business Segments

Store Operation Consignment

Overview

Provides planning, consignment, and management services for store operations to improve performance.

Competitiveness

Experience in private-room izakaya operations and multi-store management capabilities

Customers

Restaurant Chain Operators
Retail Store Operators

Products

Store Operation Know-how
Brand Management
Operation Consulting

License Brand Provision

Overview

Provides license agreements for popular brands domestically and internationally to expand business.

Competitiveness

Recognition and reliability of private-room izakaya brands

Customers

Domestic and International Restaurant Operators
Restaurant Partners

Products

Brand Usage Rights
Sales Support Services

Ingredient Procurement and Supply

Overview

Achieves high-quality cuisine provision through stable ingredient procurement.

Competitiveness

Procurement network extending domestically and internationally

Customers

Own Stores
External Restaurants
Food Wholesalers

Products

Chicken and Processed Foods
Fresh Fish
Seasonings

Competitive Advantage

Strengths

Brand strength specialized in private-room izakayas
Deployment capabilities across diverse restaurant formats
Extensive store operation experience
Expansion of licensing business
Balanced operation of directly managed and franchise stores
Concentrated store network centered on the Tokyo metropolitan area
Target differentiation between brands
Menu development responsive to regional needs
Extensive network of talent in the restaurant industry
Proven management structure with board of auditors

Competitive Advantages

High market recognition and nomination rate for private-room izakaya 'Kin no Kura Jr.'
Diversification strategy through unique multi-brand deployment
Strengthening global expansion via overseas rollout of Tokyo Chikara Meshi
Aiming for business scale expansion through franchise development
Differentiation competitiveness via target specialization per brand
Strong store concentration in the fiercely competitive Tokyo Shinjuku area
Growth foothold through launch of international licensing business in Thailand
Maintaining quality by securing stable ingredient procurement routes
Ability to respond to consumer demand across diverse formats
Marketing strength leveraging extensive customer data

Threats

Decline in dining-out demand due to COVID-19 impact
Market share contraction from intense domestic and international restaurant industry competition
Profit pressure from rising labor and raw material costs
Shifts in demand due to consumer health consciousness and declining alcohol consumption
Increasing difficulty in differentiation from competitors' brand expansions
Operational constraints from stricter regulations and shortened operating hours requests
Cultural and regulatory risks in overseas business
Management resource limitations from funding constraints in stock market
Ingredient supply issues from logistics instability
Intensified price competition from consumption tax hikes, etc.
Increased burden of new product development to gain customer support
Missed market opportunities from delays in digitalization

Innovations

2023: Opening of First Tokyo Chikara Meshi Store in Thailand

Overview: Opened the first overseas store in Bangkok through partnership with a local Thai company.
Impact: Serves as a foothold for international expansion, expecting overseas revenue growth.

2021: Brand Refresh via Trade Name Change

Overview: Changed name from Sankyo Marketing Foods Co., Ltd. to SANKO MARKETING FOODS to strengthen brand communication.
Impact: Contributes to refreshing corporate image and improving recognition.

2022: Strengthening FC Expansion for Private-Room Izakayas

Overview: Expanded FC store count through refined franchise model and enhanced franchisee support.
Impact: Contributes to brand expansion and revenue stabilization.

2020: Introduction of Digital Ordering System

Overview: Introduced contactless ordering and payment systems at key stores.
Impact: Achieves improved customer convenience and operational efficiency.

2024: Customer Attraction Enhancement via New Formats

Overview: Expanded customer base through new formats like cafe-style Pasta mama stores.
Impact: Successfully acquired younger customers, contributing to sales growth.

Sustainability

Introduced waste reduction programs at stores
Promoting active use of local ingredients
Adopting LED lighting for energy efficiency
Strengthening employee health management and safety measures
Promoting eco-friendly disposable containers
Launching food loss reduction campaigns
Strengthening collaboration with local communities
Awareness activities to prevent drunk driving
Reducing water usage and promoting recycling
Sustainability assessments in the supply chain