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YOSHINOYA, INC.

  Term Paper ID:21960
Essay Subject:
Fast food chain. Amer. & Japanese operations, franchises, format, expansion, finances, marketing, future. Charts.... More...
9 Pages / 2025 Words
4 sources, 5 Citations, APA Format
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Paper Abstract:
Fast food chain. Amer. & Japanese operations, franchises, format, expansion, finances, marketing, future. Charts.

Paper Introduction:
Yoshinoya is a Japanese company that has several basic fast-food operations in Japan, and which operates in the United States through its wholly owned subsidiary, Yoshinoya West. This research examines whether and to what extent the company should expand its American holdings in coming years. As of the end of March 1994, Yoshinoya West was operating 66 directly-owned and managed outlets, with the majority in California. The company plans to expand its operating area in the future to include the eastern and central states by using a franchise system; negotiations have already begun with an American company that wants to have a franchise in those areas. Yoshinoya West's sales already ranked 390th in the American restaurant industry in 1993, and are expected to move up to 330th place in 1994. If the opening of new outlets accelerates through the a

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||1995 | 68 |16% ||1996 | 8 5 |22% ||1997 | 935 |27% ||1998 |1 8 |31% ||1999 |1225 |36% ||2 |136 |46% | With this amount of concentration in the United States (nearly half ofthe company's operations by the year 2 ), the company is obviously goingto have to pursue an equally aggressive marketing program to introduce itsproducts into new regions as it expands, and to offer support to productsin existing regions where it is competing with highly successful Americancompanies. The currentratio, for example, measures the ability of the company to meet its currentobligations with its current assets. Restaurants and Institutions, 12-13.Horvath, P. Its coreproduct, and the one which it has exported, is the "beef bowl" concept,which has beef (or chicken) served over a bowl of rice. Takahashi, N. Restaurant sector review. To begin with, any expansion into a different market helps the companywithstand downturns in its primary markets. There were other reasons that sales fell in the Japanese market,including a reluctance of Japanese consumers to purchase goods withimported rice, and the limited menu selection that Yoshinoya has in Japan.The summer of 1994 was uncharacteristically hot, with the result thatconsumers opted for more refreshing meals than those offered by Yoshinoya. 7). The company's overseas expansion started in 1977 with theestablishment of the American consolidated subsidiary, Yoshinoya West. In the United States, the company competes indirectly withall fast food operators, and most directly with Jack-in-the-Box, whichoffers a product similar to the core product of Yoshinoya. Of course, care should betaken so that direct and franchise operations are not in direct competitionwith each other. Yoshinoya D&C. Franchising can also be a good way for small business owners to enterthe market, and can help build up community relationships that are strongbetween the company and the business sector. Within Japan, the demand for foods such as Yoshinoya has fallen off inthe mid-199 s. With aparticular focus on Los Angeles, the American chain is likely to achieveits goal of 1 outlets on the West Coast by the end of 1995. This is important since the company will need an infusion of capitalif it is going to pursue an aggressive expansion strategy within the UnitedStates. However, the company also benefitedfrom advertising that its chief competitor, Jack-in-the-Box undertook atabout the same time. Morgan Stanley and Co. The companyplans to expand its operating area in the future to include the eastern andcentral states by using a franchise system; negotiations have already begunwith an American company that wants to have a franchise in those areas.Yoshinoya West's sales already ranked 39 th in the American restaurantindustry in 1993, and are expected to move up to 33 th place in 1994. Yoshinoya is a Japanese company that has several basic operations inJapan, and which operates in the United States through its wholly ownedsubsidiary, Yoshinoya West. Yoshinoya's current American stores are located primarily inCalifornia where it offers bowl dishes and side items. UBS Research Unlimited Industry Reports.Shibanuma, S. UBS Research Unlimited Company Reports. While non-Asian consumerswill come around to the option of having non-hamburger fast food, having anAsian population on which market entrance can be based will help ensure therapid acceptance and success of the new restaurants, particularly as theyare located farther from the West Coast, where the acceptance level for the"bowl" concept is already high. And, since Yoshinoya'sdishes are priced considerably below those of its competitors, it has astrong price advantage, too. If itis unable to improve its financial performance, its expansion efforts willnot have the desired results, and the company could easily find itself over-extended in a short period of time. Another advantage to expanding to other countries is that the companycan take advantage of demographic and cultural trends which are likely tofavor the company's core products. (1994, December 28). For the future, the company is developing an even cheaper chain thanthe traditional Yoshinoya, known as 'Simple Yoshinoya' and also an 'AdultYoshinoya' chain aimed at the middle-aged and older customer in Japan. Yoshinoya should be able to take advantage of thelarge numbers of Americans who enjoy rice on a daily basis, and who seekvariety in the kinds of fast food options that are available to them. Of greater interest is the Adult Yoshinoya format, which also will notuse the Yoshinoya trade name. It has been successful forother fast food companies, and gives the parent organization control overthe image and quality of the food that is offered. In 1993, the company began activelyparticipating in television advertising, resulting in a 15 percent increasein sales in its American operations. The expansion effort in the United States is not without risk, butYoshinoya has a proven track record that should help it be successful as itreaches from the West Coast to other markets. It has a strongmarketing program, which means that it should be able to successfully sellits expansion efforts to various banks in order to obtain financing.However, this is going to put additional pressure on the company to performwell over the next several years as it needs to service the debt, and thecompany cannot lose sight of the fact that its recent financial performancehas been lackluster. Currentprojections indicate that the American market will contribute 1 percent tosales in 1995, 12 percent in 1996, 15 percent in 1997, 18 percent in 1998,2 percent in 1999, and 22 percent in 2 . However, the companyalso recognizes that its success has been built on niche marketing, andthrough simplifying its marketing in Japan and focusing on specific groups,such as the adult consumer, it hopes to repeat the success which has markedits performance to this point in time. Thesefigures indicate that the parent company (on which Yoshinoya West depends)is facing a critical financial situation that demands swift action if thecompany is to continue in its successful tradition. Simple Yoshinoya aims to add things such as self-service to thecurrent Yoshinoya format for an even lower price. During the same time, the United States hasbeen undergoing an economic recovery, with the result that more consumersare eating out more often, and these consumers are looking for a morevaried menu than fast food operators have traditionally provided in theUnited States. The use of franchisees will helpdefray some of this risk, but their use also requires an aggressivemarketing support program. While more than one in four Americans reportsthat they eat rice on a daily basis, fewer than 13 percent of Americanrestaurants offer menu items that contain rice; of these, most are inSpanish and Mexican restaurants. As the more mature group, family restaurants have seen adeterioration in their earnings. For the fast food group, return on equity rose between FY199 andFY1991, but has held steady since. 13). Even as the company enters and expands its American operations, itmust pay careful and close attention to the financial fundamentals. Key financial ratios are presented for severalyears to illustrate the overall financial picture of Yoshinoya (Takahashi,1994, 8):|Item |1992 |1993 |1994 ||Return on assets |15.7% |18.3% |17.8% ||Return on equity |8% |9.9% |9.9% ||Assets turnover |33.5 times |35.4 times |38.8 times ||Current Ratio |2.1:1 |2.3:1 |1.5:1 ||Equity Ratio |83.9% |83.9% |85.8% ||Payout Ratio |27.4% |26.7% |27.3% | These ratios indicate that although the company is entering adifficult time, its underlying financials remain strong. The family restaurant group, however,has seen such a sharp deterioration that merely preventing a furtherdecline in FY1994 and FY1995 will be a positive sign (Horvath et al, 1994,p. The chain also carries beef, steak, vegetable and combination versions ofthe bowls, and offers miso soup, clam chowder, green salad and atraditional Japanese pickle mixture. The simple Yoshinoya, adult Yoshinoya and curry restaurants areinteresting options for Japan, but are not likely to do as well in theUnited States. Aproject team was put together in November to develop new business withplans to open test outlets for Simple Yoshinoya. Those fast-foodrestaurants who do offer teriyaki chicken dishes report that they areuniversally "good sellers" (Chaudhry, 1993, p. This has beenused with some success in other fast food operations in the United States,and has become an accepted and even expected option among Americanconsumers. The outlets will not usethe Yoshinoya trade name to avoid competition with regular outlets.However, since Yoshinoya's prices are already lower than those of otherrestaurant chains, the power of a simple format in attracting Japanesecustomers is unknown. The company has recognized that there is a potentially large marketwithin the United States that it can take advantage of. The estimated number of storesin the United States also indicates the aggressive marketing that thecompany intends to undertake (Shibanuma, 1994, 6): |Year |Total Stores |% in U.S. The recurring profit margins of the fast food group, though weak, areexpected to rebound slightly in FY1995 to the ten percent level. Aproject team was put together in November to develop new business withplans to open test outlets for Simple Yoshinoya. The franchisor,on the other hand, does not have to incur the start-up costs associatedwith entering a new market, but is able to reap the benefit of expansion,nonetheless. UBS Research Unlimited Industry Reports.Shibanuma, S. Financing the expansion is likely to be done through long-term debt,which the company is in a good position to obtain. Financially, the company is in a weakened position in 1994 overprevious years, but it has strong performance in previous years thatsuggest it could recover without incurring significant losses. Ifthe opening of new outlets accelerates through the adoption of a franchisescheme, its ranking is likely to rise at a dramatic pace (Shibanuma, 1994,p. This research examines whetherand to what extent the company should expand its American holdings incoming years. Americans have a tendency to eat outmore than other nations, with the result that they are interested infinding new restaurants which can meet their needs for fast food availableeconomically. The start of operations on the East Coast should lift theratio of consolidated to parent results above the current 1. There is a danger that the company will undertake too much expansiontoo quickly, as well, and it may well be drawn into expanding its menus inthe United States to include traditional American fast food offerings suchas hamburgers. However, thecompany also benefited from advertising that its chief competitor, Jack-in-the-Box undertook at about the same time. (1993, October 15). Financially, the entrance into the American market, or the expansion,presents the company with a bit of a problem. (1994, December 28). The company joined the American fast-food tradition of appealing to families when it introduced a children'smeal in 1993. 12). The appeal of rice to American consumers, and particularly in the fastfood market, is significant. The other ratios, including profitability ratios such as return onassets and return on equity, are strong, and demonstrate that themanagement at Yoshinoya is able to make a profit on its existing financialstructure although the company itself is undergoing some degree ofdifficulty. Salesincreased 4 percent from 1993 to 1994, but 15 percent from 1992 to 1993.Operating profit increased 31 percent from 1992 to 1993, but only twopercent from 1993 to 1994. The companyplans to expand its operating area in the future to include the eastern andcentral states by using a franchise system; negotiations have already begunwith an American company that wants to have a franchise in those areas.Yoshinoya West's sales already ranked 39 th in the American restaurantindustry in 1993, and are expected to move up to 33 th place in 1994. In addition to the beef bowl, these outletswill offer fish dishes to appeal to the over-4 consumer. Yoshinoya is an example of a Japanese company which has recognizedthat its product has worldwide potential, and which also recognizes that itcan build a niche for its products both within Japan and elsewhere in theinternational market. Sales at existing outlets in Japan fell by 13 percent from 1993to 1994 due also to increased competition from low-priced restaurants andfrom convenience store lunch boxes (Takahashi, 1994, 2). The move makes goodstrategic sense in that it helps the company as a whole survive shocks toany one market, and it also take advantage of Americans' predilections fordining out and for fast food as an acceptable alternative for doing so.Its aggressive expansion program should be implemented and pursued with astrong marketing support program, with the goal of having a company that istruly international in its scope by the year 2 . 17). 3). This is the strategythat Kroc started with McDonald's, and which has been the hallmark ofsuccessful fast food companies since. The company plans to have 1 outlets by February 1996. Furtherexpansion is planned via joint ventures and franchises, which are alreadyunder negotiation, to extend the American operation to the East Coast.Agreements with these new partners were scheduled to be concluded byFebruary 1995. If even a small rebound is seen inFY1995, their operating margins should rise back towards the six percentlevel. As a result, the company offers not just beef bowls, but alsoteriyaki chicken bowls, salads, desserts, an expanded drink menu and aformat that is similar to the other fast-food chains with which Americanconsumers are already familiar. Restaurants and Institutions, 12-13.Horvath, P. This is due largely to the economic slump in which thecountry finds itself, and in the late-night customer decline whichresulted. However, while the current operating situation is not overlyencouraging, the company's underlying financial health remains strong. Bowled over. Despite all of these favorable conditions, the company cannot losesight of the fact that its sales and operating profits have increased onlyslightly in the mid-199 s; while this is due in no small part to thedifficulties that the Japanese economy has been suffering and to politicalproblems with using imported rice in its products, the company needs toshore up these figures if it is to be successful in the long-term. Yoshinoya's American stores are located primarily in California whereit offers bowl dishes and side items. This would be a mistake for the company, which has proventhat its niche marketing concept can be successful in the United States.Its Yoshinoya West operation has modeled its restaurants on the familiarconcept that Americans expect, and to stray from this concept would be torisk failure in its expansion efforts. Yoshinoya D&C. Jack-in-the-Box introduced a line of Japanese-bowldishes that were priced at a higher level to Yoshinoya's; after the companybegan promoting its new entrants, Yoshinoya's sales increased by arespectable five percent. The Dunkin' Donuts operation that the company runsin Japan has run into problems for a variety of reasons, not the least ofwhich is that the Japanese do not consider doughnuts a meal (unlikeAmericans). The relationship between the Japanese and American operations isexpected to grow closer as the American market opens up. However, thecompany has fared well against this competition, even taking advantage ofthe advertising that its competitors use in the United States, and enteringthe fray with its own aggressive advertising campaign. Keyfinancial ratios are presented for several years to illustrate the overallfinancial picture of Yoshinoya (Takahashi, 1994, 8):|Item |1992 |1993 |1994 ||Return on assets |15.7% |18.3% |17.8% ||Return on equity |8% |9.9% |9.9% ||Assets turnover |33.5 times |35.4 times |38.8 times ||Current Ratio |2.1:1 |2.3:1 |1.5:1 ||Equity Ratio |83.9% |83.9% |85.8% ||Payout Ratio |27.4% |26.7% |27.3% | These ratios indicate that although the company is entering adifficult time, its underlying financials remain strong. As with its other businesses, the curryrestaurants feature low prices per dish, making them popular with Japaneseconsumers. In Japan, the company faces competitionfrom other fast-food restaurants, and from convenience stores that offerboxed meals. The company's overseas expansion started in 1977 with theestablishment of the American consolidated subsidiary, Yoshinoya West. (1994, July 8). Thefamily restaurant group is struggling to maintain the six percent level,although a small amount of improvement is expected in FY1994 and FY1995(Horvath et al, 1994, p. Because they are considered a snack, it has been difficult forthe company to successfully penetrate the market with this operation.However, Yoshinoya has successfully cut back those stores which are notsuccessful, and is seeking to reposition the product in order to see betterresults in the future. Yoshinoya D&C. ||1995 | 68 |16% ||1996 | 8 5 |22% ||1997 | 935 |27% ||1998 |1 8 |31% ||1999 |1225 |36% ||2 |136 |46% | With this amount of concentration in the United States (nearly half ofthe company's operations by the year 2 ), the company is obviously goingto have to pursue an equally aggressive marketing program to introduce itsproducts into new regions as it expands, and to offer support to productsin existing regions where it is competing with highly successful Americancompanies. Inc. The project teamis studying details, and the success of the adult format is believed tohold the key to future expansion (Takahashi, 1994, 4). Theoverseas network now encompasses 87 outlets, of which 71 are in the UnitedStates, 11 are in Taiwan, three in Hong Kong, and one each in thePhilippines and China (as of August 1994) (Takahashi, 1994, p. Morgan Stanley and Co. It alsohas appeal in that its name is distinct from other competitors, a featurethat the company has used to some success in its marketing to this time.The company can also focus on the health aspects of its food; while high incaloric content, the food is generally low in fat. Thisbusiness is developing well. Jack-in-the-Box introduced aline of Japanese-bowl dishes that were priced at a higher level toYoshinoya's; after the company began promoting its new entrants,Yoshinoya's sales increased by a respectable five percent. By creating an image that isrecognized throughout the country, with a menu that offers standardizedfare, the company creates an organization where customers know what toexpect no matter where they are in the United States. 2X for net profit. Theoverseas network now encompasses 87 outlets, of which 71 are in the UnitedStates, 11 are in Taiwan, three in Hong Kong, and one each in thePhilippines and China (as of August 1994) (Takahashi, 1994, p. Yoshinoya is a Japanese company that has several basic fast-foodoperations in Japan, and which operates in the United States through itswholly owned subsidiary, Yoshinoya West. In this way, the expansion into the United States willenable Yoshinoya to capitalize on its core product and its ability tocreate satisfied customers. The current operatingsituation is not overly encouraging, the company's underlying financialhealth remains strong. 13). Company Reports.Takahashi, N. While the slump in the ratioindicates that the company is undergoing difficulties, it certainly has notfallen to a point where creditors are likely to refrain from issuingadditional funds. The outlets will not usethe Yoshinoya trade name to avoid competition with regular outlets.However, since Yoshinoya's prices are already lower than those of otherrestaurant chains, the power of a simple format in attracting Japanesecustomers is unknown. Bowled over. UBS ResearchUnlimited Company Reports. The company has also been able to respond well to competition, both inJapan and in the United States. This business is developing well. The company will need to establish careful guidelines for itsfranchisees with regard to food preparation and marketing, since fewAmericans have a long tradition in preparing the type of food thatYoshinoya markets, but a strong franchisee program could be the ideal wayfor the company to enter the American market. (1994, July 8). The currentratio, for example, measures the ability of the company to meet its currentobligations with its current assets. More than one in four Americans reports that they eat rice on adaily basis, but fewer than 13 percent of American restaurants offer menuitems that contain rice; of these, most are Spanish and Mexicanrestaurants. Of greater interest is the Adult Yoshinoya format, which also will notuse the Yoshinoya trade name. Its coreproduct, and the one which it has exported, is the "beef bowl" concept,which has beef (or chicken) served over a bowl of rice. ReferencesChaudhry, R. In the United States, the company has recognized that the "beef bowl"concept is not enough to attract American customers again and again to therestaurants. (1993, October 15). In the United States, Yoshinoya's best-selling item is the teriyakichicken bowl, which features grilled chicken over rice with cauliflower,cabbage, carrots and broccoli with teriyaki sauce over the entire contents. 4). In addition, Asian dishes as a whole are poorlyrepresented by the fast-food industry in America, which tends to favorhamburgers and chicken in its offerings. As of the end of March 1994, Yoshinoya West was operating 66 directly-owned and managed outlets, with the majority in California. That Yoshinoya is able to maintain astrong current ratio and keep its return on assets and equity high speakswell for its management, and suggests that it has the talent on-hand thatit will need in order to successfully market on the international level. 3). With aparticular focus on Los Angeles, the American chain is likely to achieveits goal of 1 outlets on the West Coast by the end of 1995. The company must also build on its marketing strengths to appeal tothe American consumer. Yoshinoya D&C. 8X for salesand 1. Yoshinoya may have an untapped marketfacing it as Americans clearly enjoy rice, but have not yet produced a fast-food chain which can meet that demand. Generally, industry analysts considera ratio of 2:1 to be indicative of a healthy company, which is the levelthat the company had early in the 199 s. Those fast-food restaurants whodo offer teriyaki chicken dishes report that they are universally "goodsellers" (Chaudhry, 1993, p. Expansion in the United States has several advantages for the company. In addition, the companyshould consider introducing "Value Pricing," which offers complete mealcombinations, including a drink, for a single low price. Company Reports. Althoughthe company began American operations in 1977, it has been only recentlythat it has seen the full potential that the American market offers, andthat it has made expansion into the United States a key part of its long-term growth strategy. Because ofthis, the company is best left to expanding its core American business,which is the beef and chicken bowl options with which it has alreadyregistered strong success. After approximately three years of testing, Yoshinoya opened fouroutlets of its curry chain. Inc. The company can also pursue franchising opportunities, whichremoves some of the burden from Yoshinoya directly and places it on thefranchisee. In addition, thecompany has started to develop the curry chain Pot & Pot as the thirdpillar of its business, after Beef Bowl and Dunkin' Donuts (which itmarkets in Japan). Within the Japanese market, it is easiest to divide restaurants intotwo categories: fast food and family (Horvath et al, 1994, p. (1994, August 12). The estimated number of storesin the United States also indicates the aggressive marketing that thecompany intends to undertake (Shibanuma, 1994, 6): |Year |Total Stores |% in U.S. Operating margins for both groups have deteriorated over the past sixyears, but the fast food group has performed better than familyrestaurants. The company also has strong management skills available to it in thatit is able to generate respectable financial performance even when itssales have fallen dramatically. Generally, industry analysts considera ratio of 2:1 to be indicative of a healthy company, which is the levelthat the company had early in the 199 s. The project teamis studying details, and the success of the adult format is believed tohold the key to future expansion (Takahashi, 1994, 4). 13). For example, the company hassuffered financial downturns recently in Japan in part due to the country'spoor economic performance. In addition to the beef bowl, these outletswill offer fish dishes to appeal to the over-4 consumer. 4). Yoshinoya should be able to take advantage of the largenumbers of Americans who enjoy rice on a daily basis, and who seek varietyin the kinds of fast food options that are available to them. The company has also recognized that there is a potentially largemarket within the United States that it can take advantage of. Overall, Yoshinoya's same-store sales increasedby eight to ten percent from 1992 to 1993, helped in large part by theadvertising of a competitor (Chaudhry, 1993, p. To some degree, it has done this through itsintroduction of kid's meals, a direct competition to the meals offered attraditional hamburger fast food operations. In addition, Asian dishes as awhole are poorly represented by the fast-food industry in America, whichtends to favor hamburgers and chicken in its offerings. Furtherexpansion is planned via joint ventures and franchises, which are alreadyunder negotiation, to extend the American operation to the East Coast.Agreements with these new partners were scheduled to be concluded byFebruary 1995. The relationship between the Japanese and American operations can beexpected to grow closer as the American market opens up. To be successful in its expansion program, the company should focus onlarge metropolitan areas where fast food operations are already successful. This research examines the Japanese companyand its American operation in order to perform a strategic audit on thecompany's overall performance and future outlook. As of the end of March 1994, Yoshinoya West was operating 66 directly-owned and managed outlets, with the majority in California. Yoshinoya may have an untapped market facing it as Americansclearly enjoy rice, but have not yet produced a fast-food chain which canmeet that demand. Yoshinoya can combat competitors by focusing on its single-productstrategy versus one company that tries to do "everything" well. Franchisees receive marketingsupport from their parent company, help in running the business, and thebrand recognition that goes with the company as a whole. Overall,Yoshinoya's same-store sales increased by eight to ten percent from 1992 to1993, helped in large part by the advertising of a competitor (Chaudhry,1993, p. Yoshinoya has a considerable number of products that it sells in Japanthat it has not used in its expansion to the United States. 12). Ifthe opening of new outlets accelerates through the adoption of a franchisescheme, its ranking is likely to rise at a dramatic pace (Shibanuma, 1994,p. It is recommended that Yoshinoya continue to operate some ofits restaurants directly, with the result that these will have a symbioticrelationship with the franchisees in the area. Simple Yoshinoya aims to add things such as self-service to thecurrent Yoshinoya format for an even lower price. The marketing skills that the company has demonstrated focus on itsability to accurately segment the market into groups that are willing topurchase its products at the agreed-upon price, and to recognize (in thecase of Dunkin' Donuts) when certain operations are not performing well.These core strengths should help the company achieve its aggressive plansto be successful in two of the most competitive markets in the world, theUnited States and Japan, in one of the most competitive industries, thefast food industry. Yoshinoya is a small company, relatively speaking, that is willing todilute the risk it faces in any one market by expanding internationally.Its presence in the United States may be its greatest potential, and itrecognizes this as it plans to have nearly 5 percent of its operationslocated within the United States by the year 2 . The company should also seek out areas where there is a strongconcentration of Asian consumers who are familiar with the "bowl" conceptin order to have quick access to the community. (1994, August 12). In terms ofearnings per share, the fast food group (Mos, Yoshinoya and Kentucky FriedChicken) was virtually level with family restaurants (Seiyo, Skylark,Kyotaru, Denny's, and Coco's) in FY1988, but has subsequently gained groundand continues to outperform them. Already,Yoshinoya has seen one competitor enter into competition directly againstit, but it has benefited from advertising that introduced the "bowl"concept to the market at large. Yoshinoya has a considerable number of products that it sells in Japanthat it has not used in its expansion to the United States. Although thecompany began American operations in 1977, it has been only recently thatit has seen the full potential that the American market offers, and that ithas made expansion into the United States a key part of its long-termgrowth strategy. While the slump in the ratioindicates that the company is undergoing difficulties, it certainly has notfallen to a point where creditors are likely to refrain from issuingadditional funds. Net profit increased by 32 percent from 1992 to1993, and only 7 percent from 1993 to 1994 (Takahashi, 1994, 8). The company plans to have 1 outlets in Japanby February 1996. Thisdivision is a convenient way to consider profit margins. As with its other businesses, the curry restaurants featurelow prices per dish, making them popular with Japanese consumers. However, Yoshinoya must recognize that it is competing against thesesuccessful, and much larger, fast food operations, and that they are likelyto be reluctant to give up market share to the new company. The company can also take advantage of the appeal of rice to Americanconsumers. For the future, the company is developing an even cheaper chain thanthe traditional Yoshinoya, known as 'Simple Yoshinoya' and also an 'AdultYoshinoya' chain aimed at the middle-aged and older customer in Japan. ReferencesChaudhry, R. Afterapproximately three years of testing, Yoshinoya opened four outlets of acurry chain. In 1993, thecompany began actively participating in television advertising, resultingin a 15 percent increase in sales in its American operations. Restaurant sector review. Here, consumers are only now beginning to be comfortablewith beef and chicken bowl offerings, and expanding to other "off-beat"menu items is likely to confuse customers rather than increase theiroverall awareness of the chain and its features as a whole. Currentprojections indicate that the American market will contribute 1 percent tosales in 1995, 12 percent in 1996, 15 percent in 1997, 18 percent in 1998,2 percent in 1999, and 22 percent in 2 .

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