Pleasing the Customer Leads to success
The Business Philosophy of Casual Italian Restaurant, Saizeriya
Milanese Doria gratin dish for 299 yen ($3.75). Wine by the glass for 100 yen ($1.25). Everyone in Japan must know Saizeriya, the popular casual Italian restaurant with surprisingly low prices. What first came to life 42 years ago as a tiny western-style restaurant in Chiba’s Ichikawa City has now grown into a huge chain with almost 1,000 restaurants in Japan and abroad. Founder and chairman Yasuhiko Shogaki accomplished this growth in a single generation–how did he inspire and educate his employees? In this interview we will deconstruct the leadership qualities of Mr. Shogaki.
Slash the Price of His Signature Milanese Doria Dish
The high school student stuffs his face, alternating between the Milanese Doria and the Spaghetti Peperoncino. The family shares numerous varieties of pasta and pizza dishes. The senior couple is surprised at the 100-yen a glass wine and focaccia appetizer.
“It’s this good for that price?” “You can definitely fill up even with just 1,000 yen!” With such a strong price-performance profile, restaurant chain Saizeriya has captured the loyalty of a wide-ranging customer base, growing to become one of Japan’s larger restaurant chains with about 1,000 stores in Japan and overseas, and employing more than 2,000 people. Some think that Saizeriya is part of a larger corporate restaurant chain, but in fact it is completely independent. It has its beginnings in 1967, with the tiny western-style restaurant in Chiba’s Ichikawa City where current Saizeriya chairman Yasuhiko Shogaki used to toil.
When that little restaurant opened, Shogaki was still a student at the Tokyo University of Science. His only restaurant experience thus far had been a part-time job at a cafeteria, and he didn’t come from a restaurant-owning family, either.
How did this young, inexperienced student manage to build and continue to grow Saizeriya to become such a standout in its business category?
“I was never alone in wanting to build this company bigger. It is so much fun to work our hardest for our customers. I have been carried this far thanks to employees like that, is how I feel,” explains Shogaki.
Why is it that hard-working and motivated people tend to gravitate towards Shogaki? In listening to his stories we can catch a glimpse of the unifying energy that tends to motivate others.
The first great opportunity to let the world know of the superior cost performance of Saizeriya came when the restaurant decided to slash the price of the Milano Doria rice gratin in 1999 by 40%. Overnight, Saizeriya began offering the 480-yen ($6) dish at just 290 yen ($3.75).
At the time this dish was already the biggest seller for Saizeriya. It was having plenty of impact on earnings even without the drastic price cut. Why did Shogaki cut the...