Kyowa Corporation

Basic Information

Stock Code
6570
Industry
Service Industry
Category Detail
Leisure & Recreation Facilities
Prefecture
Nagano Prefecture
Establishment Year
May 1986
Listing Year
March 2018
Official Website
https://www.kyowa-corp.co.jp/
TSE Information
TSE Information
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Other Companies
Nakano Fudo, Siliconsta, AEON Fantasy, SD Entertainment, Round One, Konfinta, GENDA

Overview

Kyowa Corporation is a major amusement facility operator based in Nagano Prefecture, established in 1986. Through numerous M&As, it has expanded into the Kanto and Tokai regions and is advancing business diversification.

Current Situation

Kyowa Corporation recorded consolidated sales of approximately 12.4 billion yen and operating profit of approximately 700 million yen for the fiscal year ended March 2023, maintaining stable growth. Its core amusement facilities are centered in Nagano Prefecture, with store networks expanding into major cities in the Kanto and Tokai regions. In recent years, it has strengthened competitiveness through M&A strategies and entered the prize production business via acquisition of subsidiary Bloom's operations. It has improved operating profit margins, set new record net profits, and advanced operational efficiency. It is also focusing on wholesale distribution of diverse leisure-related goods, establishing a multifaceted revenue base. Moving forward, it aims for growth through both regional closeness and capital region expansion, enhancing customer experiences via digitalization and new brand rollouts. While no specific sustainability policies have been publicly announced, awareness of social responsibilities such as regional contributions is high. It maintains a cautious approach to funding and investment while promoting revenue expansion through selection and concentration, along with brand unification.

Trivia

Interesting Facts

  • Originally started with batting center operations.
  • Actively pursues M&A in amusement facilities, contributing to industry restructuring.
  • Owns the most game centers in Nagano Prefecture.
  • Entered Japan's prize market through absorption of subsidiary Bloom.
  • Store name 'Apina' is a beloved Nagano-originated brand.
  • Also engages in game equipment sales, enabling comprehensive entertainment provision.
  • Practices community-oriented management through regional event collaborations.
  • Participates in numerous national industry associations, contributing to sector development.
  • Achieved rapid area expansion through store acquisitions from peer competitors.
  • Child play area 'Kids Square' is popular with families.
  • Temporarily entered online crane game business but later withdrew.
  • Strengthening youth attraction through trading card specialty stores.
  • Founder and current president maintain family-led company management.
  • Established employee stock ownership association for management participation.
  • Introduces proprietary developed equipment in batting centers.

Hidden Connections

  • Collaborates with major shareholder Yumie Corporation on coordinated store development.
  • Strengthened ties with industry giant through store transfer from Bandai Namco Group.
  • Serves as a community-rooted company playing a key role in Nagano Prefecture's regional revitalization efforts.
  • Regular member of Japan Amusement Industry Association, contributing to industry standards.
  • Deepened relationships with toy manufacturers via acquisition of subsidiary Bloom.
  • Expanded networks in toy industry through entry into prize production.
  • Contributes to regional sports promotion via batting center business.
  • Many executives hail from Nagano Prefecture, fostering strong local economic ties.

Future Outlook

Growth Drivers

  • Store network expansion leveraging M&A strategies
  • Enhanced recognition and customer base strengthening in capital and Tokai regions
  • Customer experience improvements through digital technology adoption
  • Further diversification and channel expansion in prize manufacturing
  • New service development and event collaborations utilizing regional ties
  • Strengthening kids-related businesses targeting child-rearing generations
  • Sustainable management initiatives such as energy-efficient equipment
  • Expansion into online games and digital platforms
  • Employee development and pursuit of comfortable work environments
  • Marketing enhancements aimed at acquiring new customer segments

Strategic Goals

  • Directly operated stores exceeding 100 in major cities nationwide
  • Achieve consolidated sales over 20 billion yen
  • Secure top 3 position in prize production industry
  • Expand digital service market share to over 50%
  • Strengthen CSR framework through regional partnerships
  • Realize workplaces with over 90% employee satisfaction
  • Reduce environmental impact by 30% and standardize energy efficiency
  • Build brand through collaborations with child-rearing support facilities
  • Flexible response to customer needs via diverse brand deployments
  • Increase new business sales ratio to 20% of total

Business Segments

Amusement Facility Operation Support

Overview
Services providing overall operation and management of amusement facilities, as well as M&A support.
Competitiveness
Store revitalization tailored to regional characteristics
Customers
  • Local governments
  • Commercial facility operators
  • Entertainment facility owners
  • Event operators
  • Gaming venue operators
Products
  • Operation consignment services
  • Facility management know-how provision
  • Sales planning support
  • Store M&A brokerage
  • Equipment procurement services

Game Equipment Sales and Maintenance

Overview
Provides new equipment sales and maintenance services for existing equipment.
Competitiveness
Rapid equipment procurement and repair systems
Customers
  • Game center operators
  • Facility equipment management companies
  • Used game machine sellers
  • New market entrants
Products
  • Game equipment sales
  • Repair and maintenance services
  • Installation services
  • Quality assurance
  • Equipment upgrade consulting

Prize Planning and Manufacturing

Overview
Business division handling planning, manufacturing, and sales of toys and promotional prizes.
Competitiveness
Planning capabilities and diverse product lineup
Customers
  • Amusement facility operators
  • Retail stores
  • Event planning companies
  • Toy manufacturers
  • Trading card specialty stores
Products
  • Squeeze toys
  • Original prize planning
  • Prize manufacturing
  • Promotional items
  • Novelty planning

Leisure Goods Wholesale

Overview
Broad wholesale operations for toys and leisure goods.
Competitiveness
Extensive customer network across diverse sectors
Customers
  • Retailers
  • Sports facility operators
  • Entertainment facilities
  • Musical instrument stores
  • Toy specialty stores
Products
  • Toy wholesale
  • Sports goods wholesale
  • Musical instruments wholesale
  • Game goods wholesale
  • Accessories wholesale

Facility Technical Support Services

Overview
Specialized services supporting the technical aspects of facility operations.
Competitiveness
Years of on-site know-how and rapid response capabilities
Customers
  • Bowling alley operators
  • Batting centers
  • General entertainment facilities
  • ITS companies
  • Equipment maintenance providers
Products
  • Maintenance services
  • Equipment upgrade consulting
  • Security systems
  • Facility efficiency support
  • Training programs

Digital Content Utilization Support

Overview
Support services for advancing new businesses leveraging digital technologies.
Competitiveness
Flexible planning and industry expertise
Customers
  • Amusement facilities
  • Event planning companies
  • Advertising agencies
  • Regional revitalization groups
  • Digital advertising providers
Products
  • Online game collaborations
  • Digital promotion planning
  • Customer analytics tools
  • Gamified product planning
  • Digital marketing support

Competitive Advantage

Strengths

  • Long-standing know-how in community-based store operations
  • Integrated management of multiple business brands
  • Rapid business expansion utilizing M&A
  • Stable revenue structure through diversification
  • High service quality backed by abundant employee resources
  • Steady penetration into capital and Tokai regions
  • New entry into prize manufacturing business
  • Flexible store brand strategies
  • Experience in operating large facilities
  • Established diverse sales channels
  • Unique customer base and regional partnerships
  • Rapid equipment maintenance response
  • Well-established management systems
  • Trusted relationships within the industry
  • Comprehensive employee stock ownership program

Competitive Advantages

  • Built a strong store network based in Nagano Prefecture
  • Expanded market share through M&A-driven store growth and brand unification
  • Achieved revenue diversification by entering prize production
  • Differentiated from competitors via diverse services and management strategy
  • Risk diversification enabled by multi-regional operations
  • Responsive to regional needs through flexible store brand management
  • Acquired repeat customers through excellent customer service
  • Enhanced customer satisfaction with latest equipment introductions
  • Efficient operations through focused resource allocation
  • Expansion strategy leveraging synergies with related businesses
  • Advanced facility management and operational support capabilities
  • Strengthened brand power through community collaborations
  • Aiming for new customers via online service expansion
  • Stable service provision backed by large employee base
  • Diverse product lineup meeting varied customer needs

Threats

  • Intensifying market competition from aggressive competitor store openings
  • Risk of reduced footfall from pandemics like COVID-19
  • Customer loss due to lagging digitalization in the entertainment industry
  • Risk of service degradation from labor shortages
  • Unstable consumer spending due to economic fluctuations
  • Market contraction from population decline in local cities
  • Relative disadvantage from competitors' brand strengthening
  • Operational constraints from regulatory tightening or legal changes
  • Intensified price competition from new entrants
  • Increased financial burden from rising equipment investments
  • Profit squeeze from cost inflation due to rising prices
  • Delayed response to rapid shifts in customer preferences

Innovations

2021: Entry into Prize Production Business

Overview
Acquired Bloom's business through subsidiary establishment and commenced prize manufacturing.
Impact
Successfully diversified revenue and strengthened business foundation.

2020: Implementation of Store Brand Unification

Overview
Unified multiple acquired subsidiary stores under the 'Apina' brand.
Impact
Achieved improved brand recognition and management efficiency.

2023: Store Network Expansion via M&A

Overview
Acquired 4 Bandai Namco-affiliated stores to bolster Kanto customer base.
Impact
Contributed to sales growth and expanded regional market share.

2022: Expansion of Child-Oriented Facility 'Kids Square'

Overview
Strengthened child play facilities in the Kanto area.
Impact
Successfully acquired new customer segments.

2024: Introduction of Digital Reservation and Membership System

Overview
Revamped reservation system to improve customer convenience.
Impact
Improved customer satisfaction and repeat visit rates.

Sustainability

  • Ongoing participation in local cleanup activities and community event support
  • Promotion of CO2 reduction through energy-efficient equipment introduction
  • Active use of recyclable materials for prizes
  • Institutional improvements for better employee work-life balance
  • Enhanced infection control measures for safe and secure facility operations
  • Local hiring promotion and talent development programs
  • Creation of store operation manuals emphasizing reduced environmental impact
  • Implementation of environmental awareness activities for customers
  • Contributions to sustainable local economies
  • Formulation of plans to promote green power usage