QSR Interview | By Blair Chancey
Can you give an example of maximizing materials? For example, when you buy a whole salmon fish, most people only use a couple parts of the fish but we use almost the whole fish. We actually get a much better use of the fish and are more environmentally friendly because there’s less waste.
Another way is when we opened our first outlet, most Japanese restaurants had a seating capacity of 50 for a 1,000-square-foot restaurant. We were able to double that by creating a longer conveyor that runs into the kitchen. For outlets that are odd-shaped, we were also the first to design belts that run and snake round the shape of the restaurant.
Is the menu the same at all Sakae locations? Generally we have about 60 or 70 percent of the menu that’s similar at all the locations, so that we can have a brand identity. The rest, we check what’s happening in the market—the demand, the pace—and we fill those roles with the other parts of the menu.
Your stores use kiosks called Interactive Menus. What’s the advantage of using those? It’s quite simple technology, and we just apply it to the restaurant environment.
When we first started, Japanese food was very new to the marketplace, so if our colleagues at the front of the restaurant are asked, ‘What is a California Roll?’ 20 times a day, on the 20th time they’re not going to be able to smile. But if you click on the computer 2,000 times a day, it’s always going to smile back at you.
That’s the reason we have it there, so people will take the time to learn about the menu. If you click on an item, you can see a picture and a description of the item and even the nutritional information so people can make healthy choices.
Are the computers really worth the financial investment? When we started in 1997, it was very expensive. One unit would be about $2,000 to $3,000. The reason why we invested in that is because we were able to bring down the labor costs. We don’t need someone to take you to your table or take your order. Also, the computers offer great data mining. We took a lot of information about the customers. Over time, that way we were able find out how the tables were ordering and eventually bring down our costs.
Are your locations franchised or are they all company-owned? We’re in seven countries and cover 12 cities—Singapore, Jakarta, Chiang Mai, Beijing, Chengdu, Hong Kong, Shanghai, Manila, Kuala Lumpur, Penang, Selangor, and New York City. Of these, Indonesia, Thailand, and the Philippines are franchised stores.
What do you look for in a potential new market? Any textbook will tell you that you need to do a basic risk assessment looking into areas such as regulatory, legal, environmental, political, and financial. We also ensure that we have a good network of suppliers, regulators, and property owners before we enter the market. And while we exercise a lot of prudence before signing on the dotted line, we also look at the long-term potential of the market. And we do not mind entering it even if it may be deemed as high risk.
Do you look to develop one country or continent at a time or multiple stores in various top-performing markets? We take one step at a time. We actually go to one country and try to build a substantial number of locations to make it viable and sustainable before we move on to the next. But we have so many inquiries from all over, so sometimes there’s the temptation to spread ourselves out. But really we need the correct structure and support system to keep costs down, so we’re very focused.
That brings me to sourcing. Is it challenging sourcing consistently to so many areas across the globe? We take a two-pronged approach. We work with a core group of global suppliers, and we centralize purchases of selected items. This provides economies of scale for the group in general. On the other hand, if there are local suppliers who can provide a better deal due to proximity and quality, we will then work with the local suppliers. The two-pronged approach helps us to manage our costs and prices so that we give the best in terms of raw materials and the best prices.



