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Mizuho 1038 food_service Mizuho 1038 food_service Document Transcript

  • Japan Industry Outlook / 38 2012 No.1 Table of Contents1, Comprehensive Industry - Japan 15, Broadcasting (Japanese only)2, Iron and Steel - Japan 16, Marine Shipping (Japanese only)3, Non-ferrous Metals - Japan 17, Logistics - Japan4, Paper and Pulp (Japanese only) 18, Electric Power - Japan5, Cement - Japan 19, City Gas (Japanese only)6, Chemicals - Japan 20, Retail - Japan7, Pharmaceuticals - Japan 21, Food and Beverage - Japan8, Petroleum - Japan 22, Food Service Industry - Japan9, Automobiles - Japan 23, Construction (Japanese only)10, Shipbuilding (Japanese only) 24, Real Estate and Housing - Japan11, General Machinery (Japanese only) 25, Travel and Tourism - Japan12, Electronics - Japan 26, Nonbank (Credit Cards & Credit) (Japanese13, IT Services - Japan only)14, Telecommunications - Japan 27, HR Service Industry (Japanese only) Contact: Industry Research Division Mizuho Corporate Bank, Ltd. mizuho.ird@mizuho-cb.co.jp
  • FY2012 Japan Industry Outlook (Food Service Industry) The Food Service Industry Summary Food service expenditures (per household member) in 2011 are forecasted to be minus 3.2% year-on-year as a whole, largely due to the fall in food service expenditures immediately after the Great East Japan Earthquake, despite signs of the leveling off of the expenditure declines from June and beyond. Food service expenditures in 2012 are forecasted to increase 1.8% year-on-year. While reconstruction-related demand is expected to peak out in the second half of the year, bringing with it some uncertainties about the mood of self-restraint in consumption, food service expenditures are forecasted to increase in 2012 as a whole with the income environment expected to improve, including an increase in summer bonuses as corporate performance improves. Net sales of all stores of food service chain companies as a whole in 2011 were minus 1.2% year-on-year as a result of the impact of negative factors, including the mood of self-restraint in consumption following the earthquake, restraint in summer events, and poor weather. Net sales of all stores in 2012 are forecasted to increase as a whole, due to the expected increase in the number of customers and sales per customer based on the easing of the self-restraint in consumption following the earthquake and improvements in the income environment. Furthermore, the number of stores is expected to increase as a result of new store openings, primarily in the FF category. The fiscal 2011 mid-term results of 39 listed food service companies (with over JPY20 billion in net sales) showed revenue increases and profit increases owing to the significant number of new store openings in the Japanese fast food category (hereinafter “FF category”) centered around the gyudon chain companies. The fiscal 2011 results of eight major companies were dominated by the results of individual companies, including Zensho HD’s revenue increase as a result of opening new Sukiya stores and McDonald’s HD’s revenue decrease as a result of franchising and store relocations.I. INDUSTRY TRENDS1. Food service expenditure trends Food service Food service expenditures (per household member) in 2011 are forecasted to be expenditures in minus 3.2% year-on-year, largely due to the fall in food service expenditures 2011 forecasted to from March to May caused by the Great East Japan Earthquake, despite signs decrease 3.2% year-on-year of the leveling off of the expenditure declines from June and beyond (Figure 22-1). While food service expenditures decreased by as much as 16.0% 1 Mizuho Corporate Bank, Industry Research Division
  • FY2012 Japan Industry Outlook (Food Service Industry) year-on-year in March, they recovered to register a 1.3% year-on-year increase by July. Several overlapping factors contributed to the significant recovery in July, including the payment of summer bonuses and the easing of self-restraint in consumption following the earthquake, an earlier-than-usual end of the rainy season, and one additional national holiday compared to July 2011. In August 2011, the restraint of summer events and poor weather led to fewer opportunities for food service utilization, and food service expenditures were minus 3.3% year-on-year. However, food service expenditures are on a path to recovery from the earthquake disaster, with expenditures increasing 0.1% year-on-year in October and being minus 0.3% year-on-year in November.Food service Food service expenditures in 2012 are forecasted to register growth in the firstexpenditures in half of the year as the income environment improves with the recovery in2012 forecasted to corporate performance. In the second half of the year, whileincrease 1.8% reconstruction-related demand is expected to peak out, bringing with it someyear-on-year uncertainties, the income environment is anticipated to remain as solid as the first half of the year. Hence, food service expenditures for the whole year are forecasted to increase 1.8% year-on-year.Earthquake’s The ratio between food service and home meal replacement expenditures as aeffect to cause share of the food expenditures in 2011 (ratio of home meal replacements) has,shift in consumer as a whole, maintained a certain ratio even after the earthquake and isdemand fromfood service to forecasted to be 28.3%, around the same level as the previous year (Figurehome meal 22-2). Due to a decline in opportunities for food service utilization, the ratio ofreplacement food service expenditures decreased by minus 0.4p year-on-year. Meanwhile, as demand for home meal replacements increased through their sales at retail stores, such as convenience stores, owing to their convenience in terms of both price and location, the ratio of home meal replacements increased by 0.3p year-on-year. As such, awareness is quickly spreading about the convenience of home meal replacements among consumers. 2 Mizuho Corporate Bank, Industry Research Division
  • FY2012 Japan Industry Outlook (Food Service Industry) [Fig. 22-1] Food service expenditure and food expenditure (monthly) year-on-year rate of growth (per household member) (Unit: %) 14.0 外食支出 expenditure food service food expenditure 食料支出 10.0 12-month moving averages 12ケ月移動平均(外食支出) 12-month moving averages 12ケ月移動平均(食料支出) Food (food service expenditure) (food expenditure) ▲1.1% 6.0 2.0 -2.0 -6.0 Food service-10.0 ▲3.2%-14.0 <Yearly> <Monthly>-18.0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011e 08/1 2 3 4 5 6 7 8 9 10 11 12 09/1 2 3 4 5 6 7 8 9 10 11 12 10/1 2 3 4 5 6 7 8 9 10 11 12 11/1 2 3 4 5 6 7 8 9 10 11 (CY) (Source) Compiled by MHCB Industry Research Division based on Ministry of Internal Affairs and Communications Statistics Bureaus “Household Survey Report.” (Note) Figures for two or more person households. [Fig. 22-2] Ratio of food service and home meal replacement expenditures as a share of food expenditures Ratio of home meal replacement (Unit: %) 30 2 8 .3 2 8 .3 2 8 .4 2 8 .3 2 7 .4 2 7 .7 2 7 .6 2 7 .7 2 8 .2 2 8 .2 2 8 .0 2 7 .1 25 9.2 9.6 9.7 9.8 9.7 10.2 10.4 10.2 9.9 10.0 10.3 10.6 20 15 10 17.9 17.7 18.0 17.7 18.0 18.0 17.9 18.1 18.2 18.0 18.1 17.7 5 Home meal replacement Food service 0 (CY) 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011e (Source) Compiled by MHCB Industry Research Division based on Ministry of Internal Affairs and Communications Statistics Bureau’s “Household Survey Report.” (Note) “Home meal replacement expenditures” are “prepared foods” excluding “frozen prepared foods” and “food stuff for cooking.” 2011 figures are based on MHCB Industry Research Division forecasts. 3 Mizuho Corporate Bank, Industry Research Division
  • FY2012 Japan Industry Outlook (Food Service Industry) 2. Chain company trends Net sales of all The trends of franchise chain companies, which account for JPY3.9 trillion stores (including (estimate) of the JPY22.9 trillion-food service market in 2011 (estimate), are new stores) in 2011 examined based on the company trends of the Japan Food Service Association minus 1.2% year-on-year (JF) members (requirement for full membership: company with over JPY100 million in annual sales) (Figure 22-3). Net sales of all chain companies, including sales of newly opened stores, were minus 1.2% year-on-year in 2011 as a result of the impact of negative factors, including the mood of self-restraint in consumption following the earthquake and poor weather in August and September (Figure 22-4). Net sales of all Net sales of all chain companies in 2012 are anticipated to increase throughout stores (including the year due to the easing of the self-restraint in consumption following the new stores) in 2012 earthquake and an improved income environment with the recovery in forecasted to increase corporate performance. However, reconstruction-related demand is expected to peak out, bringing with it some uncertainties, and the situation remains unpredictable. [Fig. 22-3] Estimated size of [Fig. 22-4] Chain companies’ (monthly) year-on-year food service market by category (2011) growth (all stores) 8 (%) JPY3.9 trillion Sales Store number 6 Customer number Sales per customer (17%) 4 Total 2 JPY22.9 trillion 0 -2 JPY19.0 -4 trillion <Yearly> <Monthly> (83%) -6 2000 2002 2004 2006 2008 2010 08/2 08/4 08/6 08/8 08/10 08/12 09/2 09/4 09/6 09/8 09/10 09/12 10/2 10/4 10/6 10/8 10/10 10/12 11/2 11/4 11/6 11/8 11/10 11/12 Franchise stores Private stores (CY)(Source) MHCB Industry Research Division projections based (Source) Compiled by MHCB Industry Research Divisionon Japan Food Service Associations “March 2011 Food based on Japan Food Service Association documents.Service Industry Management Trends Survey Report” and (Note) Three-month moving averages.“Food Services Report” and Foodservice Industry ResearchInstitute’s “2010 Food Service Industry Market Projection.” Next, chain company trends are examined according to four categories: FF Background and trends of sales category (2011 market size: JPY1.7 trillion 1 ); family restaurant category recovery differ by (hereinafter “FR category”; 2011 market size: JPY0.8 trillion); pub and izakaya chain category category (2011 market size: JPY0.5 trillion); and dinner restaurant category (hereinafter “DR category”; 2011 market size: JPY0.2 trillion). To understand the characteristics of each category, both one-month and three-month moving averages are confirmed to analyze the trends. Net sales of all stores in 2011 in the FF category, while registering minus 8.3% year-on-year based on the 1 The 2011 market size of each category is projected based on Japan Food Service Association’s “March 2011 Food Service Industry Management Trends Survey Report” and “Market Trends Survey” and is comprised of 95 listed companies. 4 Mizuho Corporate Bank, Industry Research Division
  • FY2012 Japan Industry Outlook (Food Service Industry)single-month average in March, recovered to +2.0% year-on-year based onthree-month moving averages in November (Figure 22-5). The majorcontributing factors were that among the FF category, chain companies such asleading gyudon companies – Sukiya, Yoshinoya, and Matsuya – as well asleading self-service udon noodle company, Marugame Seimen, continued toopen new stores even after the earthquake. In 2012, new gyudon andself-service udon noodle stores are expected to open. As a result of this increasein store numbers, net sales of all stores are expected to see a positive trend. Netsales of all stores in 2011 in the FR category fell to minus 9.4% year-on-yearbased on the single-month average in March as a consequence of theearthquake (Figure 22-6). From June and beyond, while the number ofcustomers increased, helped by marketing measures centered around the massmedia, net sales of all stores based on three-month moving averages stayed at±0% year-on-year even in December, due in part to the poor weather fromAugust to September. In 2012, while companies will be less willing to opennew stores and the number of stores will hover around the same level, brandshifts by existing stores of companies, such as Skylark and Royal HD, andrenovations of the existing stores of companies are projected to increase thenumber of customers, in turn leading to a positive trend in net sales of all stores.Net sales of all stores in 2011 in the pub and izakaya category fell sharply byminus 19.8% year-on-year based on the single-month average in March andcontinued to decrease based on both one-month and three-month movingaverages (Figure 22-7). This negative trend has continued almost consistentlysince November 2008. The reasons include the increase of the elderlypopulation, the decrease in alcohol consumption among the young generation,and the novelty of existing izakaya stores wearing off among consumers. Forthese reasons, net sales are projected to continue to decrease in 2012. Net salesof all stores in 2011 in the DR category, while falling to minus 19.5% comparedto all years based on the single-month average in March, showed strongrecovery in June, increasing 0.6% based on three-month moving averages(Figure 22-8). It is projected that this is the result of an increase in the numberof customers and sales per customer and that this capture the consumers’ needsto “enjoy a little luxury” in response to the self-constraint in consumption. Netsales of all stores in 2012, while expected to increase due to the easing of theself-restraint in consumption following the earthquake in the first half of theyear, are forecasted to decrease as companies slow down in new store openingsin the second half of the year, causing store numbers to level off. 5 Mizuho Corporate Bank, Industry Research Division
  • FY2012 Japan Industry Outlook (Food Service Industry) [Fig. 22-5] (Monthly) year-on-year rate of growth in FF [Fig. 22-6] (Monthly) year-on-year rate of growth in FR category (all stores) category (all stores) (%) 12 (%) 10 10 Sales Store number Sales Store number Customer number Sales per customer 8 Customer number Sales per customer 8 6 6 4 4 2 2 0 0 -2 -2 -4 -4 -6 -6 -8 <Yearly> <Monthly> <Yearly> <Monthly> -10 -8 2000 2002 2004 2006 2008 2010 08/2 08/4 08/6 08/8 08/10 08/12 09/2 09/4 09/6 09/8 09/10 09/12 10/2 10/4 10/6 10/8 10/10 10/12 11/2 11/4 11/6 11/8 11/10 11/12 2000 2002 2004 2006 2008 2010 08/2 08/4 08/6 08/8 08/10 08/12 09/2 09/4 09/6 09/8 09/10 09/12 10/2 10/4 10/6 10/8 10/10 10/12 11/2 11/4 11/6 11/8 11/10 11/12 (CY)(CY) (Source) Compiled by MHCB Industry Research Division based (Source) Compiled by MHCB Industry Research Division based on Japan Food Service Association documents. on Japan Food Service Association documents. (Note) Three-month moving averages. (Note) Three-month moving averages. [Fig. 22-7] (Monthly) year-on-year rate of growth in [Fig. 22-8] (Monthly) year-on-year rate of growth in DR pub/izakaya category (all stores) category (all stores) (%) (%) 15 8 Sales Store number 6 Sales Store number 10 Customer number Sales per customer Customer number Sales per customer 4 2 5 0 0 -2 -4 -5 -6 -8 -10 <Yearly> <Monthly> -10 <Yearly> <Monthly> -15 -12 2000 2002 2004 2006 2008 2010 08/2 08/4 08/6 08/8 08/10 08/12 09/2 09/4 09/6 09/8 09/10 09/12 10/2 10/4 10/6 10/8 10/10 10/12 11/2 11/4 11/6 11/8 11/10 11/12 2000 2002 2004 2006 2008 2010 08/2 08/4 08/6 08/8 08/10 08/12 09/2 09/4 09/6 09/8 09/10 09/12 10/2 10/4 10/6 10/8 10/10 10/12 11/2 11/4 11/6 11/8 11/10 11/12 (CY) (CY) (Source) Compiled by MHCB Industry Research Division based (Source) Compiled by MHCB Industry Research Division based on Japan Food Service Association documents. on Japan Food Service Association documents. (Note) Three-month moving averages. (Note) Three-month moving averages. II. CORPORATE EARNINGS 1. Mid-term results of food service companies (39 listed companies) The fiscal 2011 mid-term results of 39 listed food service companies with over JYP20 billion in net sales showed revenue increases and profit increases (net sales +0.2% and operating income +12.6% compared to fiscal 2010 [Figure 22-9]). The revenue increase stemmed in large part due to new store openings by low-priced brands. Specifically, Japanese FF – Zensho HD (sales +7.5% year-on-year) and Matsuya Foods (+6.9% year-on-year) – increased sales by actively opening new stores and increasing customer numbers through price-down campaigns in the gyudon business. In addition, Toridoll, operator of 6 Mizuho Corporate Bank, Industry Research Division
  • FY2012 Japan Industry Outlook (Food Service Industry) the self-service udon noodle restaurant chain (+24.8% year-on-year), increased sales by new store openings. The profit increase stemmed from companies’ continued closures of unprofitable stores and wide-ranging cost review, coupled with new store openings by Japanese FF, including Zensho, Matsuya Foods, and Toridoll. While the overall result was revenue increases and profit increases, among the 11 food service categories, only 3 had revenue increases and profit increases due to the impact of sales declines in the earthquake’s immediate aftermath. [Fig. 22-9] Fiscal 2011 mid-term results by food service category (year-on-year change) 60.0 Revenue decrease / profit increase Revenue increase / profit increase 50.0 Japanese FF(6) 40.0 ■ Japanese FR (3) Home meal Net sales: -2.86% replacement (4) Operating income: +523% DR (2) 30.0 ■ Service (1) Net sales: - 4.68% Operating income: +1031% Izakaya (6) 20.0 10.0 Total (39) Western FR (5) 0.0 Cafe (2) Western FF (3) -10.0 Chinese (4) -20.0 -30.0 Kaitenzushi (3) Revenue decrease / profit decrease Revenue increase / profit decrease -40.0 -15.0 -10.0 -5.0 0.0 5.0 10.0 15.0(Source) Compiled by MHCB Industry Research Division based on corporate financial statement documents.(Note) Major food service companies: 39 listed companies with over JPY20 billion in sales (fiscal 2010 results) andpublic records of net sales and operating income by category (1. Western FR: Saizeriya; Joyfull; CreateRestaurants; Saint Marc HD; Nippon Restaurant System; 2. Japanese FR: Gourmet Kineya; Sato RestaurantSystems; Sagami Chain; 3. DR: Kisoji; Umenohana; 4. Western FF: McDonald’s Holdings Japan; Kentucky FriedChicken Japan; Mos Food Services; 5. Japanese FF: Zensho [individual basis]; Yoshinoya HD [gyudon business];Matsuya Foods; Ichibanya; Toridoll; Fujio Food System; 6. Izakaya [Japanese style bar/restaurant]: Colowide;Watami [food services business]; Daisyo; Via HD; Dynac; Sanko Marketing Foods; 7. Cafe: Starbucks CoffeeJapan; Doutor; 8. Food service: SHiDAX; 9. Kaitenzushi [revolving sushi bar]: Kappa Create; Kura Corporation;Genki Sushi; 10. Home meal replacement: Plenus; Hurxley; Rock Field; Kozosushi So-Honbu; 11. Chinese/Ramen:Ohsho Food Service; Ringerhut; Kourakuen; Hiday Hidaka)While Nippon Restaurant System and Doutor are listed in separate categories, they are counted as one company. 7 Mizuho Corporate Bank, Industry Research Division
  • FY2012 Japan Industry Outlook (Food Service Industry)2. Results of eight major companies Revenue The fiscal 2011 results of eight major companies show revenue decreases and decreases and profit increases, with net sales minus 1.0% and operating income up 5.9% profit increases in FY2011 year-on-year (Figure 22-10). With regard to net sales, while Zensho HD’s highlighted by opening of new Sukiya stores is expected to increase revenues, McDonald’s Zensho HD and Holdings Japan’s revenue decreases as a result of franchising and store McDonald’s HD relocations are forecasted to weigh down overall revenues. As for operating results income, Zensho HD’s profit increase owing to expanded sales, McDonald’s improvement in cost ratio through franchising, and all companies’ reductions in cost ratio and selling, general and administrative (SGA) expenses through cost-cutting measures are forecasted to increase overall profits. [Fig. 22-10] Results forecast for 8 major companies[Actual] Companies FY10 FY11 FY12 (Unit) (Result) (Estimate) (Forecast) (8 major companies) Net Sales 8 Major 13,809 13,677 13,897 McDonald’s HD Japan; Zensho HD; Yoshinoya Companies (JPY100 million) HD; Colowide; Watami; Royal HD; Seven & i Operating Income 774 820 883 Food Systems; and Saizeriya (Source) Compiled by MHCB Industry Research Division based on corporate financial statement[Rate of Change] (Year on Year) documents. FY10 FY11 FY12 (Note) Figures: Consolidated base; For Seven & i (Unit) (Result) (Estimate) (Forecast) Food Systems, figures from Seven & i Holdings food business are used. Figures for FY2011 and Net Sales - 0.3 - 1.0 + 1.6 8 Major FY2012 are based on MHCB Industry Research Companies Division forecasts. (%) Operating Income + 42.0 + 5.9 + 7.7 Revenue The fiscal 2012 results of eight major companies are forecasted to record a increases and JPY22 billion yen increase in revenues year-on-year due to: 1) Sales increases profit increases from Zensho HD’s and Yoshinoya HD’s new store openings and new menus for anticipated in FY2012 their gyudon business; and 2) Sales increases from Watami’s new office openings for its nursing care and elderly-oriented home delivery service businesses. Profits are also forecasted to increase by JPY6.3 billion year-on-year due to: 1) Profit increases from the above sales increases for Zensho HD, Yoshinoya HD, and Watami; and 2) Improved cost ratio from McDonald’s Holdings Japan’s franchising efforts.III. TOPICS: Promising Business Areas in the Medium-Term – Food Service Industry Possibility of food With Japan set to face a decreasing population and a declining birthrate and service companies aging society, a mid- to long-term contraction of the domestic food service capturing home market is inevitable. However, the Great East Japan Earthquake has triggered meal replacement market 8 Mizuho Corporate Bank, Industry Research Division
  • FY2012 Japan Industry Outlook (Food Service Industry) an increase in home meal replacement expenditures. Furthermore, home-cooked meals and home meal replacements account for a large proportion of the food expenditures of elderly households. A key to a successful business strategy for food service providers will thus be the capturing of the home-cooked meal and home meal replacement markets. In particular, as many operators of low-priced food service chains have said, it is certain that convenience stores, too, will become competitive in both price and convenience. In this context, food providers will face an increasingly fierce battle for the food market, with retail stores also participating in the battle. From this perspective, the food service industry has witnessed an increasing number of companies starting home delivery services from their restaurants, as well as companies establishing drive-thru services, with the aim of capturing the home meal replacement market by offering a wide selection of eat-in, take-out (drive-thru), and delivery services. Nonetheless, food service companies’ core service is providing food and customer service to those consumers who come to their restaurants (eat-in). Home meal replacement services, such as take-out and delivery, are merely additional services or an extension of eating-in. As long as the QSC 2 evaluation is low (based on the eat-in menu, the cleanliness and atmosphere of the restaurant’s exterior and interior, and customer service), this will not lead to the use of take-out and delivery services, and in turn, to the capture of the home meal replacement market. Therefore, it goes without saying that it is essential that the food service industry continues to improve the attractiveness of eating-in. Possibility of In view of the growing elderly population, another possible option for food using food as a service providers is to use food as a gateway into businesses for the elderly. For gateway into example, Watami, an izakaya (Japanese style bar/restaurant) operator, entered businesses for the elderly the nursing care business by purchasing R No Kaigo Inc. in 2005. It has also entered the food delivery business for the elderly by purchasing Takushoku Co., Ltd. in 2008. Watami has succeeded in expanding both businesses by utilizing its knowhow in materials procurement and meal preparation accumulated through its food service business, as well as by setting forth a concept to provide high quality food. Possibility of Meanwhile, overseas, the middle income tier is expanding with the economic establishing many growth in neighboring Asian countries. Also, with Japanese food increasing in stores overseas brand value, the overseas is becoming an attractive market and steadily drawing utilizing local in Japanese food service companies. Nonetheless, most companies that have companies established businesses overseas are chain companies with overseas stores numbering in the range of only a few stores to several dozens of stores. It is difficult to say that at present Japanese food is being provided to a greater2 QSC stands for Quality (quality of menu), Service (customer service), and Cleanliness, and is the most fundamental principle that ought to be followed by companies and employees in the food service industry. 9 Mizuho Corporate Bank, Industry Research Division
  • FY2012 Japan Industry Outlook (Food Service Industry)number of the world population. Furthermore, due to the difference in pricelevels with Japan, the contribution to the company’s sales and profits continuesto remain low. For future expansions into the overseas market, it is the view ofthe author that it will be most effective to forge partnerships with localcompanies as a solution to different challenges confronting companies,including those challenges which cannot simply be dealt with through thebusiness knowhow acquired in Japan, such as the overseas securing of realestate, marketing, and labor management, and the large amount of investmentrequired to open new stores. In Asian countries, with the expansion of themiddle income tier and the diversification of the food culture, local companiesmay be found that are interested in the Japanese food service business. It ishoped that Japanese food service companies will forge partnerships with localcompanies to establish many stores swiftly, provide Japanese food to morepeople overseas, and contribute to the development of the food culture in all thecountries. Shinya Endo Distribution & Consumer-related Team Industry Research Division Mizuho Corporate Bank, Ltd. 10 Mizuho Corporate Bank, Industry Research Division