Tori Aristocrats Raise Prices, but Many Are Convinced — Amazing Management Efforts that Changed Izakaya History

On May 1, Tori Aristocrats Holdings announced that it would raise the price of its yakitori chain Tori Aristocrats from 350 yen to 360 yen. Among them, Tori Kiya’s price hike, which is based on uniform pricing, will have a strong impact on the market.

However, many consumers seem to have taken a favorable view of Tori KiRi’s price hike, with comments on Twitter such as “It’s great that the price increase is only 10 yen,” “Still cheap,” and “The original price is too low.” It is assumed that many people accept the price hike as a result of the best possible management efforts to cope with soaring food prices and increased energy costs.

In fact, Tori Aristocrat has made many improvements in order to maintain its low prices and uniform pricing. To briefly review the history of Tori Aristocrat, the first Tori Aristocrat restaurant opened in Higashi Osaka City, Osaka Prefecture, in May 1985, but the menu was not uniformly priced from its inception.

However, because the restaurant was located in front of Shuntoku-cho Station on the Kintetsu Osaka Line, which has less than 10,000 passengers per day, it struggled to attract customers, and the business remained in the red for more than a year. In order to break out of this deficit, the company introduced uniform pricing. This doubled their sales, and they began to solidify their style as a uniform-price yakitori restaurant, but it was not until the late 1990s that they began to seriously focus on opening more restaurants. The pace of store openings accelerated after the company’s entry into the Tokyo market in 2005, and the number of stores surpassed 100 in 2007.

When uniform pricing was introduced, the price was 250 yen excluding tax. Since then, the price has changed to 280 yen excluding tax (since 1998), 298 yen excluding tax (since October 2005), 350 yen including tax (since April 2010), and will be revised to 360 yen including tax in May 2011. The 280-yen price was in effect for 19 years, the longest period in the chain’s history, and many people associate Tori Aristocrats with the 280-yen price.

In addition to uniform pricing, another unique feature of Tori Kikin as a yakitori chain is that each restaurant skewers its own yakitori. This is intended to shorten the time between skewering the chicken and serving it as a product and to minimize quality deterioration, but skewering chicken is a very hard job. However, skewering chicken is a very labor-intensive job, and it places a heavy burden on the on-site staff to skewer hundreds of pieces of chicken every day at each restaurant.

During the day, the preparation staff handles the chicken and skewers the meat, while the sales staff serves yakitori in the evening. The division of labor between preparation and sales staff was introduced based on the idea that tired staff who skewered chickens would not be able to provide satisfactory service, and conversely, tired staff skewering chickens would reduce productivity.

Tori Aristocrat’s signature dish is its jumbo yakitori “aristo-yaki,” which weighs 90 grams each, and this product was also devised in order to achieve uniform pricing.

Tadashi Okura, president of Tori Aristocrat HD, said in an interview, “If skewering is too hard, why not reduce the number of skewers? With this in mind, we decided to make jumbo yakitori, which comes in large portions, our signature product” ( Shibata Shoten, August 2018 issue of “Gekkan Shokudo”).

In other words, the aristocrat yakitori was created not only as a signature menu item with a good price, but also as a product that reduces the burden of preparing food.

Aristocrat yaki has been a signature menu item since the establishment of the restaurant, and during the process of opening new restaurants, a customized yaki stand was developed for aristocrat yaki. With an off-the-shelf baking stand, the aristo-yaki is too large and sticks out from the stand, making it difficult to bake and making the baking consistency uneven. The introduction of a custom-built baking stand that matches the size of the nobles’ yaki has solved this problem and increased productivity.

Tori Aristocrat has prepared a number of special items like the Aristocrat Yaki to increase the value of its uniformly priced products. For example, the alcohol menu includes a large mug of “Kinmugi” and a medium mug of “The Premium Malts,” but the menu also used to include a highball of the single malt whisky “Yamazaki 10-nen.

Some of the featured items have a cost ratio of over 40%, but Tori Aristocrat has been able to keep the cost ratio down to around 30% by mixing its menu items. In the case of food, standard menu items such as chilled tomatoes, edamame (green soybeans), and french fries have a low cost of sales. For drinks, sours and chu-hi (a refreshing beverage made from a variety of ingredients) are also low-cost items.

However, the cost push has spread to all food ingredients, making it difficult to absorb the rising cost of ingredients through menu mixing.

On the other hand, in February 2007, Tori Aristocrat introduced “Amoeba Management,” a business management method devised by Kazuo Inamori, founder of Kyocera Corporation. The company has been striving to secure appropriate profits by cutting unnecessary costs such as utilities and reducing working hours in store operations on a store-by-store basis.

As mentioned above, Tori Aristocrat raised the price to 350 yen including tax in April 2010, and the price will be revised to 360 yen including tax in a little over a year. The announcement of the price hike indicates that the pace of cost increases is so fast that even Tori Aristocrat, which has been making every effort to reduce costs, will no longer be able to cover them through management efforts alone, and this news may foreshadow a further intensification of the rush to raise prices, not only in food service but also in other areas.