Samen is a faith.
Author | Editorial Department of Pinzhao
The price increase is on the hot search
The Sammons expressed understanding
The price of Saliya, the happy poor ghost of the worker, has been on the hot search, but consumers say that it is still very cheap.
"Saizeriya's price increase is also cheaper than most other brands." Samana believer Xiaohua said;
Muzi, a bystander, agreed, "The price should be raised, as a consumer, I am worried that Saizeriya will not make money." ”
Xiaowen, a pizza lover, said excitedly, "Saria's pizza starts at 15 yuan, which is simply my happy hometown." ”
Despite some reservations about the price increase, consumers have shown a high degree of understanding and support for Saria's price increase on the whole. According to a Weibo survey conducted by the Morning Post, about 60 percent of respondents were able to accept the price increase, while only 11 percent said they could not.
Founded in 1973, Saizeriya, a Japan Italian affordable Western food brand, has more than 400 stores in China, mainly in first-tier cities such as Beijing, Shanghai, Guangzhou and Shenzhen. Among them, Guangdong Province alone has 181 stores, Guangzhou accounts for 74, and Shenzhen has 65.
In first-tier cities, even after experiencing price increases, Saizeriya's cost performance is still very high.
Porcini mushroom chicken cheese grilled rice rose from 18 yuan to 20 yuan;
Tuna salad rose from $11 to $12.
It is widely believed that the price increase of Saizeriya is due to increased cost pressure, but in fact, Saria's gross profit margin is as high as more than 60%, and its performance has been excellent in recent years.
Saria's business data丨Source: corporate financial report
According to Saizeriya's latest financial report, between September 2023 and May 2024, its sales increased by 24% year-on-year to an all-time high of 163.2 billion yen, and its operating profit reached 10 billion yen, about three times that of the same period last year.
Since it is not affected by performance pressure, why does Saizeriya dare to choose to increase prices against the trend when peers are cutting prices and the price war is intensifying?
High efficiency + pre-made dishes
It's the secret of Saizeriya's low cost
It is impossible to mention Saizeriya without mentioning its two labels:
The originator of pre-made dishes
The King of Human Efficacy
These two labels reveal the secret behind Saria's low cost.
Looking back at the brand's history, Saizeriya was not positioned as a cheap Western food from the beginning. In 1973, the founder, Yasuhiko Masagaki, took over a small shop located upstairs in the wet market, which initially served authentic Western food, which was very expensive.
The principle of "location determines life and death", Maagaki Yasuhiko must not have understood at first, due to the mismatch between geographical location and brand positioning, resulting in a limited target customer base, Saria's initial business was very cold.
Later, Yasuhiko Masagaki decided to significantly reduce the price and promote it, directly discounting the original price by three percent. Cheap is a miracle, and Saizeriya has become one of the most popular western restaurants in the local area, and the business that originally had less than 20 people a day has instantly become more than 800 people.
Saizeriya Dongguan International Trade Store丨Source: Photo by Red Meal Network
But what if it's cheap and not profitable? Lower costs! Yasuhiko Masagaki has taken a series of measures to this end:
1. Improve human efficiency: optimize the operation process of employees.
When serving, serve the plate directly by hand, without a tray;
The mop is equipped with an automatic water refiller, which saves the time of fetching water;
The mopping adopts a "U" shaped path to eliminate ineffective repetitive work.
Optimize your employees' steps in seconds.
In addition, Saliya also uses a large number of temporary workers, with a high proportion of 80%, and has established an hourly group of workers to facilitate the scheduling of shifts in advance.
The advantage of using temporary workers is that not only does it reduce the cost of wages, but it also eliminates the cost of social security and employee accommodation, which undoubtedly increases the total cost lead of Saliya.
2. Prefabrication of all ingredients: make full use of the central kitchen.
In Saizeriya, order 15 dishes and serve them all in 9 minutes.
In the kitchen of the Saliya store, you don't see a kitchen knife, and you don't see a chef in the traditional sense, and all the dishes are standardized and served very quickly. All the kitchen work that can be centrally handled is moved to the central factory to be completed on a large scale, and the main work of the back kitchen of the store is heating and plating.
Saria's rich menu丨Source: Photo by Red Meal Network
The money saved is the money earned.
This focus on practicality was unique in Japan at the time, in contrast to other Western restaurants that were keen to invest more in decoration and try to attract customers through the environment.
Saria's philosophy is that regardless of whether it is Western food or not, as long as the environment is clean and hygienic. The food doesn't have to be exquisite, as long as it tastes good. As for the kitchen equipment, it doesn't need to be overly complicated, it is durable and has enough capacity.
The most important thing is the price, as long as the price is low, there is no need to worry about the lack of customers.
Small meal strategy
Steady progress in the downgrade of consumption
Saria's success is not only based on low prices, but more importantly, it follows the trend of small meals. Saizeriya doesn't offer a simple fast food, but an affordable version of a high-quality Western-style meal.
During the period of rapid economic growth in Japan, Saizeriya adhered to a low-price strategy, and after the bursting of the bubble economy, its model won huge dividends. During the economic depression in Japan in the 80s, the division of the middle class intensified, and Saria's high cost performance met the needs of family dinners and friends gatherings, becoming an ideal choice after the middle class was downgraded.
As a result, even in the face of economic challenges, Saizeriya did not choose to cut prices, but stuck to her pricing strategy. Saizeriya believes that every store is different, and that turnover is affected by location, store size and core products. If the business is not doing well, it is to blame for the decision-making of the top management rather than the ability of the store manager.
Saizeriya Dongguan International Trade Store丨Source: Photo by Red Meal Network
Why does Saizeriya dare to raise prices now? Now the trend of consumption downgrading is also obvious, and compared with the past, Saizeriya can quickly conclude: "I don't need to reduce the price".
A restaurant that has a reputation for being cheap has its own price sticking to its principles. This insight alone has surpassed many domestic catering industry peers.
On the surface, low prices seem to be Saria's winning formula, but in reality, the modest low price is its real characteristic.
Saizeriya firmly believes that reducing waste, streamlining menus, and cutting expenses directly at the cost level is the best strategy to deal with the decline in turnover. Blindly lowering prices will only make customers get used to lower prices, and once the economy picks up, customers may no longer accept the original price level.
If you decide to reduce the price, you must be prepared to keep the price low for a long time. Otherwise, customers may churn once the price pulls back.
epilogue
Warren Buffett said in a speech in 2011, "The only decisive factor that matters when evaluating a business is pricing power." If you can afford to raise prices without the business going to your competitors, you have a good business. If you have to pray before raising prices by 10%, you have a bad business. ”
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