Thursday, March 3, 2011

Wendy’s Plans to Return to Japan

This past week the U.S fast-food chain Wendy’s announced they were looking into establishing a joint venture with a Japanese company to help re-enter their chain into the Japanese marketplace. The first Wendy’s restaurant is expected to open this year in Tokyo, and there are plans to rapidly expand their brand into further countries over the next few years, starting with China and Brazil.  
The fast-food company began their joint venture in the Ginza area of Tokyo during the 1980’s. The fast-food chain was operated by a Japanese department store called Daiei up until 2002 when the chain began losing money. The fast-food chain was then sold to a Japanese company called Zensho until 2009 when they too began losing money and eventually decided to end their franchisee contract with Wendy’s.
Wendy’s has now begun their search for a new joint venture to help with the relaunch of their fast-food chain into the Japanese market. I am curious to see if this re-launch will be successful for Wendy’s. I am also hopeful that Wendy’s has learned from their past mistakes and has taken the opportunity to analyze certain aspects of their business practices that were not working so well in the past for them.
Taking a note from Burger King, during 1991 Burger King entered the Japanese market but was quickly unsuccessful because of their limited menu offerings and their high price point. In comparison to the local McDonalds price point, Burger King’s pricing was unappealing to many consumers. Burger King was forced to leave the Japanese market in 2001, 2 short years after entering the market, due to low sales. Since then, Burger King conducted market research on the Japanese market to fully understand what it was that Japanese consumers were really looking for. The company has reopened their stores in Japan a few years later and have been moderately successful since. No word yet if Burger King is experiencing the success they were anticipating when re-entering the Japanese market.

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