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BENIHANA OF TOKYO
Ma Hai Duong
Background
• Benihana is primarily a steakhouse employing
the ‘Hibachi’ style of cooking
• Founded in 1964,Hiroaki Aoki (Rocky)
• Started franchising in 1969
• 15 units from 1972
Initial strategy
• Introduce of Hibachi to:
Provide greater attention and service to the
customer while still keeping costs low.
Increase the proportion of the productive area.
Limit the main menu to 3 entrees to reduce
wastage and cut costs.
Insist on historical authenticity.
Site selection
• Benihana had one basic criterion for site
selection: High traffic.
• Rent normally 5%-7% of sale for 5,000-6,000
square feet of floor space.
• Most units were located in a predominantly
business district, though some had access to
residential areas.
Training
• All chefs were highly trained: they had completed a
three-year formal apprenticeship.
• They were given a three to six month course in Japan in
the English language and American manners.
• Training chefs within the United States was also a
continuous process.
• Paternal attitude Benihana took toward all its employees.
• The unique combination of Japanese Paternalism in an
American setting had to be appreciated.
Organization and control
• Each restaurant carried a simple management structure: a
manager, an assistant manager and two or three front men.
• Reporting structure:
• Individual quota figures allotted base upon overall sales
goals and budget.
ManagerManager of operations
Vice president of operations
Advertising policy
• Different and original in advertising approach.
• Outstanding visual in ads.
• The advertising policy is different and it makes
them seem different to people.
• The company invested 8-10% of its gross sales
on reaching the public.
Future expansion
• Self operated restaurant and franchisees:
Franchisees owner were not experienced in
restaurant business but only investors.
Culture difference in owner and native Japanese
staff.
Control on franchisees was difficult.
• One of biggest constraints is staff.
• Finally, there is the cost factor.
Different between Benihana production
and other typical restaurants
• The “Hibachi table” concept
• Historical authenticity for the building material
• Use space for kitchen is only 22%
• Presenting dynamic cooking show to the
customers
• High number of recommendations and word of
mouth publicity (67%)
• Benihana model business difficult to replicate.
Benihana business model
• Limited menu => keeps cost of food and wastages to
bare minimum.
• Minimize flow time => keep turnover rate high thus
utilization and throughput
• Minimize Waste
• Minimize Inventory
• Optimal site selection =>High traffic area and keep
an optimal mix to meet the business district and
residential flow
• Minimize Space
• Highly trained, skilled and motivated workforce
Design choices
• Making Japanese cooking tangible - People
feel good about the cooking process and not
food only
• Personal Training - Highly trained personal
• Reducing Risk - Market research and setup at
highly populated area
• Controlling quality - Making the customer
look what they are being cooked
Conclusion
• Benihana primarily sells on the strength of its food
products.
• It reduces wastage through its simple menu.
• The potential market is huge yet there are resource
constraints in scaling up.
• The ad spend could be reduced or reworked to
increase efficiency.
• Large scale retail of processed food products could
affect quality.
• Could be pursued under a separate brand.