Watami in Taiwan & China
Watami Foods’ has upgraded the old, smokey image of the “izakaya” pub into a clean, friendly space for family gatherings. This has paid off in domestic growth that has led to 600 locations. JMR intern Ada Chen takes a look at the Watami formula for success as it expands further into China and other parts of Asia.
Founder Miki Watanabe started his restaurant business in 1986. After some experimenting with concepts and store formats, he open the first "Watami" restaurant a few year later. Watami ("the people's) restaurants differ from traditional Japanese “izakaya”: A typical izakaya is a drinking bar that also serves food, making it a convenient place for
after-work drinking with workplace friends. The Watami approach expands the izakaya into drinking space with better food, more cheerful decor and attentive staff, Consistency in menu offerings, preparation and service are an integral part of the formula. Watami has been successfully re-shaping the image of such establishments and maintained reasonable prices. This has attracted the hip 20s crowd as well as families. With over 600 locations it is on its way to attaining its target of a 20% of the market share for such eating establishments in major Japanese cities.
Hong Kong and Taiwan -- a hit with the locals
In late 2001 Watami group opened its first oversea restaurant in Hong Kong and the business expanded rapidly. It buffed up its image and its 20 restaurants in Hong Kong as see by locales as a fashionable Japanese food.
In Taiwan, Watami is doing even better. The image of the restaurant is chic; the food rated highly by the locals and service is impressive. Watami’s enhancements to the old “izakaya” format has lifted it into the quality restaurant category in Taiwan, enjoying a classier reputation than they have in Japan. Watami continues to expand there.
Mainland China -- hitting the Great Wall of resistance
Things evolved differently in China though. Its mainland of China outlet open in Shenzhen in 2005, about the same time as they started their Taiwan business. However there are still only 3 restaurants in Guangdong Province and 3 in Shanghai. Mainland Chinese took less warmly to the Japanese restaurant format. Chinese national pride are strong and memories of the war years still linger in the Chinese political mindscape. The Watami story in China is still being written however and the on-going internationalization taking place in big cities such as Shanghai and ChongQin will open new opportunities for the Watami formula to work its magic on restaurant goers. = AC with RM
