Watami

Basic Information

Stock Code
7522
Industry
Retail
Category Detail
Restaurants
Prefecture
Tokyo
Establishment Year
May 1986
Listing Year
October 1996
Official Website
https://www.watami.co.jp/
TSE Information
TSE Information
Yahoo! Finance
Yahoo! Finance
Other Companies
Yakiniku Sakai Holdings, DD Group, Doutor Nichires, Kaifan, AP Holdings, Chimney, Eternal Hospitality Group, Skylark, SFP Holdings, Yoshix Holdings, Sanmaruku, Kushikatsu Tanaka Holdings, Daisho

Overview

Watami is a retail company founded in 1986, centered on the restaurant business and diversifying operations, with izakaya chains as its foundation, expanding into fast food, agriculture, and delivery services.

Current Situation

Watami boasts consolidated sales of approximately 90.9 billion yen and net profit of about 4.2 billion yen as a pioneer in restaurant and delivery businesses. Starting from its flagship izakaya format 'Watami,' it actively expands into yakiniku, Chinese, and fast food formats. In the 2010s, it withdrew from the nursing care business to consolidate management resources. In recent years, it has expanded stores through franchise contracts and strengthened overseas development in China, Taiwan, Singapore, and elsewhere. While it has faced criticism in the past for labor environment issues and food safety incidents, it has implemented improvement measures and is addressing sustainability. In 2024, it acquired the Japanese subsidiary of Subway, entering the fast food business in earnest, and is advancing new format development and business diversification toward 2030. It is building a foundation for future growth through diversified funding and strengthened management structure.

Trivia

Interesting Facts

  • The company name 'Watami' derives from the name of founder Miki Watanabe.
  • Watami operates numerous stores domestically and internationally.
  • Watami previously engaged in nursing care but withdrew in 2015.
  • Past violations of the Labor Standards Act surfaced, leading to corrective actions.
  • In 2014, it reached a high-value settlement over a karoshi suicide case.
  • In addition to restaurant brands, it has entered agriculture and environmental businesses.
  • In 2024, acquired Subway's Japanese operations, entering fast food in earnest.
  • Introduced a unique employee independence system to promote business succession.
  • Obtained international ISO certifications to strengthen quality control.
  • Engages in educational support in developing countries as social contribution activities.

Hidden Connections

  • Rare example of a company named after its founder's name.
  • Major beverage companies and financial institutions participate as key shareholders.
  • Subway Japan acquisition builds ties with major fast food players.
  • Aims for vertical integration from ingredient production to food provision through agriculture-food service fusion.
  • Karoshi incident sparked societal debate on corporate labor environment improvements.
  • Pursues sustainability as a corporation through RE100 and environmental recycling activities.
  • Sale of nursing care business enabled focus on restaurant and delivery operations.
  • Responds to 'black company' criticisms in the industry without shying away from legal action.

Future Outlook

Growth Drivers

  • Aggressive rollout of new fast food brands
  • Expansion of home meal delivery demand amid aging society
  • Business diversification in diverse domestic and international dining markets
  • Enhanced corporate value through environment and sustainability initiatives
  • Overseas market growth and new store openings
  • Accelerated growth leveraging franchise model
  • New format development to capture younger and female customers
  • Operational efficiency through digitalization and IT utilization
  • Improved employee satisfaction and retention via labor environment enhancements
  • Customer support through strengthened health-oriented menus
  • Stable funding through capital alliances
  • Strengthened collaboration with local communities

Strategic Goals

  • Increase fast food and restaurant stores to 1.5 times current number
  • Expand home meal delivery sales to over 20 billion yen
  • Maximize CO2 reduction effects through nationwide environmental business
  • Achieve 50% or more ratio of ingredients with sustainability certifications
  • Maintain turnover rate below 10% through ongoing labor environment improvements
  • Raise overseas business sales ratio above 20%
  • Significant improvement in store operations efficiency using IoT and AI
  • Achieve 30% increase in young customers through new format development
  • Expand annual social contribution spending to over 100 million yen
  • Complete plastic container recycling system at all stores

Business Segments

Ingredient Supply for Restaurant Chains

Overview
Stable supply of ingredients to diverse business formats.
Competitiveness
Procurement expertise honed through multi-format operations
Customers
  • Izakaya Chains
  • Yakiniku Shops
  • Cafes
  • Restaurants
  • Hotels
  • Hospitals & Nursing Facilities
Products
  • Pre-processed Ingredients
  • Frozen Foods
  • Alcoholic Beverages
  • Seasonings
  • Vegetables & Fruits

Home-Delivered Bento & Prepared Meal Services

Overview
Specialized delivery services for health and daily living support.
Competitiveness
Hand-delivery by Magokoro Staff
Customers
  • Elderly Facilities
  • Home Care Recipients
  • Public Organizations
  • Medical Institutions
Products
  • Nutritionally Adjusted Bento
  • Care Meals
  • Ingredient Delivery

Food Manufacturing & Processing

Overview
In-house manufacturing and supply of processed foods from contracted farms.
Competitiveness
Strict quality control and contract farming system
Customers
  • Retailers
  • Food Service Industry
  • Processed Food Companies
Products
  • Processed Agricultural Products
  • Organic Vegetable Products
  • Dairy Products

Environment & Energy Services

Overview
Supports store environmental improvements through energy savings and recycling.
Competitiveness
Environment solutions tailored to store operations
Customers
  • Store Operators
  • Corporate Facilities
  • Local Governments
Products
  • Energy-Saving Systems
  • Recycling Equipment
  • Renewable Energy

Education & Human Resource Development Services

Overview
Provides education support for retail and food service industries.
Competitiveness
On-site oriented HR training expertise
Customers
  • Watami Group Companies
  • Food Service Companies
  • Staffing Agencies
Products
  • Recruitment Support
  • Employee Training Programs
  • HR Development Consulting

Competitive Advantage

Strengths

  • Covers broad customer segments with diverse restaurant brands
  • Stable revenue base from delivery services
  • Secures ingredient safety through agriculture collaboration
  • Nationwide store network and franchise system
  • Stable financial base through capital alliances
  • Aggressive overseas expansion and globalization
  • Strong brand recognition and customer base
  • Utilization of unique employee independence system
  • Expansion into environmental businesses and social contributions
  • Ongoing business restructuring for improved management efficiency

Competitive Advantages

  • Addresses diverse market needs with abundant store formats
  • Rapid store expansion leveraging franchises
  • Enhanced cost control through synergies with agriculture and delivery businesses
  • Organizational improvement system learned from past labor issues
  • Entry into fast food via Subway Japan acquisition
  • High-quality management with ISO certifications
  • Improved brand image through community-based social contributions
  • HR development strength from proprietary training system
  • Collaboration with major food & beverage companies via capital ties
  • Flexibility in risk diversification through diversified businesses

Threats

  • Market contraction due to consumers shying away from dining out
  • Damage to corporate image from labor environment issues
  • Intense price competition and new formats from rivals
  • Risk of brand damage from food safety issues
  • Impact of economic downturn on consumer spending
  • Fluctuations in raw material prices and procurement risks
  • Political and economic risks in overseas expansion
  • Costs associated with store closures and format changes
  • Decline in competitiveness from delayed adoption of new technologies
  • Increased operating costs from stricter regulatory compliance

Innovations

2024: Acquisition of Subway Japan Business

Overview
Acquired the Japanese operations of fast food chain 'Subway' to promote business diversification.
Impact
Successfully entered the fast food market and expanded customer base.

2023: Acquisition of Singapore Food Company

Overview
Made a Singapore food-related company a subsidiary to develop new markets.
Impact
Strengthened business foundation in the Asian market.

2022: Launch of New Format 'Sushi no Watami'

Overview
Launched a new sushi brand in Koto Ward and began store rollout.
Impact
Contributes to dining diversification and new customer acquisition.

2021: Introduction of Renewable Energy Toward RE100 Achievement

Overview
Switched electricity used at headquarters building and food factories to 100% renewable energy.
Impact
Contributes to reduced environmental impact and improved corporate image.

2020: Accelerated Expansion of 'Karaage no Tensai' via Franchise Contracts

Overview
Partnered with Kosidaka Holdings to promote multi-store rollout.
Impact
Contributes to market penetration and sales growth of the new format.

Sustainability

  • Transitioning to renewable energy for electricity toward 2040 RE100 goal
  • Introduction of collection and recycling system for plastic bento containers
  • Energy-saving promotion activities at group stores
  • Expansion of organic and low-pesticide farming at contracted farms
  • Store operation optimization to reduce food waste
  • Food education activities and educational support for local communities
  • Logistics efficiency improvements to reduce environmental impact
  • Social value creation through health-oriented menu development
  • Ongoing efforts to improve working environment
  • Promotion of local production for local consumption using regional ingredients