A Closer Look into Torikizoku’s Expansion in Singapore
Those who worked in Japan will know the “sacred” ritual: Nomikais. Chugging a glass of Asahi, getting another Yakitori skewer, or maybe dealing with a drunk colleague getting way too honest in the confined space of an Izakaya.
If you are a Singaporean who have lived through that rush hour all the way to clocking off to an izakaya, and want a taste of nostalgia, Torikizoku is opening soon at VivoCity. But If you’re expecting an article about the long meandering queue on the first day of opening, you’re in the wrong place.
Instead, I will be talking about the business and the joint venture behind it.
Enter Fairprice, the Big Guy behind the Torikizoku Singapore Expansion
When you want to expand your services or brand to another country, the first thing you will want to worry about the partner you are engaging in the target country. Are they competent enough? If they are competent enough, do they have the same vision as your company or brand? We all know that a lot of brands fail overseas for various reasons, including unforeseen circumstances, low support and mismatch between visions of partners.
According to The Nikkei, Japan’s Eternal Hospitality Group will franchise Torikizoku through Gohan Concepts, a joint venture between Fairprice Group and BHAG Pte. Ltd. And looking at the name “Fairprice Group”, does that name ring a bell?
For anyone living outside Singapore, the Fairprice name is something that everyone in Singapore will know. Enter Fairprice Xtra, Fairprice Finest, the series of supermarkets by the group. If you go to any Kopitiam or Lau Pa Sat, you may pay with the NTUC Fairprice app connected with your credit/debit card to get a 10% discount. You may even find extensions of the group in stores like Unity, which is a pharmacy offering medicine at affordable prices, and Cheers, a convenience store chain to fulfill daily needs. All of these belong to the Fairprice Group. But what is exactly that group?
Fairprice Group is an extension of NTUC (National Trades Union Congress), a union federation that uses social enterprises to give workers purchasing power on top of wage power. It was founded with the mission of keeping daily essentials within reach to everyone in Singapore. That is reflected in several activities such as Textbook Donation Drive, Launch of Fairprice Housebrand with cheaper prices.
What does that tell us?
Torikizoku is known as that affordable izakaya in Japan. Collaborating with Fairprice Group means that their vision and mission are aligned, as both are committed to providing affordable food to many people. Besides that, Fairprice Group is already experienced with running Kopitiams including Lau Pa Sat, not them venturing to F&B for the first time. This means that this expansion is expected to be a relatively strong foundation for the business to run.
What does that mean for the neighboring countries?
With Eternal Hospitality Group having established a subsidiary in Vietnam, and a franchisee in the Philippines, this Torikizoku expansion could be seen as a step-by-step strong expansion. Expansion to Singapore could be seen as a testing market that could be reduplicated to Vietnam (like copy paste but not exactly copy paste).
Expanding to Vietnam has some risks (it will need to bear the costs and face operational risks and the complexities of hiring staffs), but they can still learn from the experience in Singapore and apply only what is applicable. It is also worth noting that operations in Vietnam will closely resemble Torikizoku in Japan, compared to Singapore, due to the socioeconomic factor. Singapore’s per capita income is quite high that the price might be adjusted for a certain margin.
In Philippines’ case, it is worth mentioning that Japanese Izakayas are on the rise in the country, removing the preconception that Japanese food is very expensive. That means Torikizoku’s entry to Philippines’ market will be slightly more difficult that there are many competitors in the market. It is up to the brand to position itself as something different so that it will not be left behind in the izakaya craze.
In Malaysia and Indonesia, things might get more challenging because the two countries are predominantly Muslim, hence Halal certification is strongly recommended for the brand to be able to reach out to more audiences. This proves to be a challenge because of the izakaya culture is inseparable from the alcohol drinking culture.
Even though there are brands that have successfully entered Indonesia and obtained halal certification, such as Yoshinoya, Torikizoku entering Indonesia will make it a point to redefine the drinking aspect of the izakaya. The brand must not only learn to navigate itself and tweak its recipe without changing the taste as much, but also innovate so that the brand will be well received in these two countries, without diluting its cultural essence. That might involve sparkling water, yuzu, and other alternatives on the menu.
Other challenge includes a lot of home-grown Japanese brands like Hoka Hoka Bento in Indonesia, Empire Sushi and Sushi King in Malaysia. As general customers are already accustomed to these restaurants, Torikizoku has to endeavor in localization to be able to compete well with these opponents, or risk losing out.
When you see the Torikizoku Opening Soon board in VivoCity, probably you will think, “Oh, it’s another juicy delicious chicken skewers in town”. But deep inside it lies a plan to democratize Yakitori culture outside Japan.
I bet you are already hungry by just reading this article.
But if you are hungry for expansion to overseas market, Vintage Management is here for you.
We have the knowledge and experience that helped 500 companies expand overseas and succeed.
If you want to work with us, contact us and we will be happy to assist you.
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