Sat | Dec 10, 2016

Little Tokyo goes big on franchises - Seeking 20 operators in Jamaica, others in the Caribbean

Published:Sunday | November 30, 2014 | 12:00 AM

Tameka Gordon, Business Reporter

Despite recent setbacks at home, quick-service food chain, Little Tokyo Restaurant, is pushing ahead with its nascent franchising programme through which it will be expanding into Caribbean markets in 2015.

In Jamaica, its home base, the company aims to have an outlet in every parish within the same time period, General Manager Paul Williams told the Financial Gleaner.

Little Tokyo was founded by Harry Zheng who came to Jamaica in the 1980s and set up shop in the Liguanea Post Mall in Kingston. The restaurant, which sells Asian fast food, was eventually relocated directly across the road to Sovereign Centre, where its flagship outlet remains today.

The company currently has 11 restaurants, three of which are operated by the owners while the others are franchises.

"We started franchising this year. We offered three, but they had a breakdown so we have taken them from them (the franchisees)," said Williams.

But undeterred, Little Tokyo is now offering 20 franchises nationwide for next year and has received almost 50 applications so far.

"Put it this way, Little Tokyo will be in every parish by the end of next year - that is our goal. It has been growing for the last nine years but this is the first push to really put the brand out there," said Williams.

He adds that the Asian food chain is going after market share held by the dominant fast-food operator in Jamaica, KFC.

Little Tokyo has seen interest from franchisees in Trelawny and Old Harbour and is looking "everywhere" to push its offerings, Williams said.

Franchisees will have to pay $2 million to $8 million for the franchises, and are expected to employ at least one Chinese chef for authenticity, he said.

The cost is pegged to the size of the outlet, with sizes ranging from 1,000 square feet to 3,000 square feet.

"Background in food and beverage is good but not hard and fast," he said, adding that persons from the community in which the restaurant is to be located will have an edge.

"We find it helps the store to progress quicker," he said.

The company has realised profits from its other stores within the first six months of business, the GM said.

Little Tokyo has targeted Cayman Islands, The Bahamas, and Trinidad & Tobago for immediate expansion, with two outlets initially earmarked for Trinidad.

The Trinidadian outlets, he said, will be operated by Little Tokyo while Cayman and Bahamas will be franchises.

"Lots of Trinidadians have been putting up on our website that the food is great and they would love something like that down in Trinidad. So we did a scoutng
mission earlier this year and found two very good locations," said
Williams.

He said the company also noted
"overwhelming" interest through its online market surveys of Trinidad
and hopes to tap the "greater disposable income" of residents
there.

"Both Trinidad stores will be corporate. We
have a corporate office in Trinidad as well, because there is room for
at least four in Trinidad and one in Tobago, so we are planning that,"
said Williams.

"All of this year, we have been
researching it, and in the third month of next year, we will actually be
moving some stores into those locations," he said of the regional
expansion thrust.

Bahamas will eventually see three
stores but only one has been confirmed so far, he
said.

In Jamaica, Sovereign Centre remains Little
Tokyo's top-performing outlet.

"We do about 1,200
lunches a day there and on the weekend we do about a couple hundred
more," said Williams.

In Kingston, the company also
has outlets in Cross Roads, Papine, Seventh Avenue Plaza, and the newest
at Half-Way Tree, which opened three months
ago.

Outside the capital, Little Tokyo is in Portmore,
Mandeville, Ocho Rios, Spanish Town and Savanna-la-Mar, while three
locations are now planned for Montego Bay.

Pulled
franchises

A new store will open in Portmore to
replace the franchise that was pulled from the previous operator. The
new location will be at Destiny Mall.

The Spanish Town
and Ocho Rios stores are also set for new management after the
franchise partnerships were pulled.

"We are coming for
KFC," Williams declared.

Companies Office of Jamaica
records name Harry Zheng and Fie Yan as directors of Little Tokyo. The
company was incorporated in
2006.

tameka.gordon@gleanerjm.com