Japan`s Chains Devise Clever Strategies Amid Crisis

▽ Mobile phones with simple functions

Japan’s third-largest wireless communications service provider SoftBank Mobile saw robust growth last year, according to Nikkei Business Daily.

The company snared 2.39 million of the 5.3 million new subscribers to the service in Japan last year.

SoftBank’s recipe for success was simple mobile phones, which were sold more than a million units last year. Mobile phones come with a variety of functions such as Web surfing, television streaming, MP3 player, digital camera and electronic payments.

SoftBank’s simple mobile phones, however, simply enable calls or the sending of e-mail.

“Senior citizens and young consumers bought our mobile phones. Many young consumers want mobile phones with just the necessary functions,” a company source said.

▽ Fitness clubs with basic facilities

“Curves,” a fitness club exclusively for women, has 700 branches across Japan. The number of members grew more than 20 percent last year to reach more than 210,000 members.

The club has no showers, swimming pools or full-length mirrors. Each branch is equipped with only 10 kinds of exercise equipment.

A membership costs just 5,000 to 6,000 yen (55 to 66 U.S. dollars) per month, far cheaper than Curves’ competitors. Middle-aged housewives, accounting for around 70 percent of the club’s members, visit with their friends and work out for half an hour per day.

Since a branch needs minimal space to accommodate basic exercise equipment, new branches have mushroomed to attract more housewives.

▽ Flat rate service

Restaurants have been hit the hardest by the economic downturn in Japan. Nevertheless, the bar chain Torikizoku run by the Osaka-based Eternal Service has been a huge success.

The chain’s secret is to price every side dish and beverage at 280 yen (3.10 dollars).

Torikizoku has added 30 branches every year over the past three years and had 128 last month.

Two skewers of roasted chicken, salad or a meal costs just 280 yen each. The prices of alcoholic beverages are set lower than those sold at convenience stores and each skewer of roasted chicken weighs 60 grams.

In seeking to provide all kinds of food and drink for 280 yen, the pub has struggled to cut costs and draw more customers. Most Japanese bars sell 80-90 kinds of food and drink, but the number is just 55 for Torikizoku.

Too many items usually result in cooking difficulty, delayed service and a fall in customer turnover. To raise customer turnover, Torikizoku uses electric grills to cook meat or fish that cook ingredients two times faster than charcoal grills.

The chain’s customer turnover rate stands at 2.5, two times that of other bars.

Torikizoku also sets up branches on the outskirts of cities to take advantage of lower rent.

sya@donga.com