Chiaki Tanuma: From Keio's Student Cafeteria to a Comprehensive Food Service Enterprise

Thank you. My father, Bunzo Tanuma, the founder who passed away in 2000, was actually a Waseda graduate. He was drafted into the military during the war and seems to have gone through immense hardships.

I heard he welcomed the end of the war in Hanoi, Vietnam. He was a company commander of an automobile unit transporting supplies in a convoy of about seven vehicles with around 120 men, traveling some 300 kilometers from the south to Hanoi. They were hit by machine-gun fire from above, and he said only 30 people survived in the end. It sounds like it was truly horrific.

After returning from the battlefield, he went back to university and graduated. At that time, a professor at Waseda helped him find a job and introduced him to Professor Tadashi Moriyasu of Keio. Professor Mori, who was the deputy head of the preparatory course at the time, told him that nearly 150 Keio University students were evacuated to Noborito (referring to the temporary school building where preparatory students studied from October 1945) and asked if he could look after the dormitory students there. It seems there was also support from Professor Mitsuo Maehara and Professor Kunio Nagasawa, who later became the President. So, he became the superintendent of the student dormitory, and when he gathered the students to ask for their requests, they said they were just incredibly hungry. That was the start—serving meals by imitating what he saw, even though he had never done it before.

He said there were many children who were pale and looked malnourished. He couldn't bear to see those who were so broke they looked like they might collapse, so he occasionally let them eat for free. Apparently, they were extremely happy.

It seems there were a lot of potatoes. There was almost no white rice. There was something called "potato rice," but he joked that it wasn't "rice with potatoes" but "potatoes with rice" (laughs). I heard there was also something called "Norim-pan" (Glue Bread). They would put glue-like paste on it instead of cream.

Yes. Made from bran, it had a thick consistency. Since sugar was a luxury item back then, they added things like saccharin.

That's right. So we were allowed to move the cafeteria there as well. While we were looking after the students that way, Keio decided to build a memorial hall for its 100th anniversary. Since the cafeteria was right in that spot, we were told, "We're sorry, but please vacate the premises." At that time, our company only had this one cafeteria, so if it disappeared, about 60 employees would lose their jobs.

At first, an alternative site wasn't easily available, but eventually, we were able to build a cafeteria next to the original one. However, the problem was that there was no money to rebuild. Apparently, it was quite a struggle to make it happen. Since my father had a heavy special vehicle license, he worked as a dump truck driver and the like to scrape by for about a year. After a year and a half of all that, the cafeteria finally reopened, and almost all the employees came back.

From that experience of being closed for a year, he thought it was dangerous to have only one cafeteria location and decided to expand to multiple stores. A few years later, a large, magnificent, state-of-the-art factory for Matsushita Communication Industrial was built just past the Hiyoshi Campus, and a graduate who had used the cafeteria in Hiyoshi asked if we would run the cafeteria there. Starting with that, we began handling cafeterias for other companies and schools.

That's right. It seems Sei'ichiro Takahashi served as the selection committee chairman. They decided that the student whose entry was adopted would get free meals for a year (laughs). I think the name "Green House" had an environmentally friendly image and showed some foresight.

No, I think he regretted it quite a bit (laughs). Even if one meal was 50 yen, a year's worth adds up to a lot.

We received several offers for company cafeterias, and as the business became somewhat established, we wanted to open a restaurant where we could decide the products, contracts, and prices ourselves. So, in December 1966, when the Odakyu Underground Shopping Center was built in Shinjuku, we opened the first "Saboten" store at the edge of it.

Apparently, my father had an opportunity to go to Mexico with someone who was the president of the Japan-Mexico Association, with whom he was very close. Inspired by seeing someone wearing a sombrero and a flashy checkered shawl, he came up with the idea of a tonkatsu restaurant with a Mexican-style interior. Since it was Mexico, he decided to name it "Saboten" (laughs).

The month after Saboten opened, we decided to open a Chinese restaurant nearby. The name of this restaurant became "Shahoden" based on a play on words: Saboten, Shaboten, Shahoden (laughs). When he asked a Chinese person, they told him, "That is a good name."

There are parts that make you laugh. He was interesting. He had a personality that eased the tension around him. He went through many life-and-death situations, but he never let that show on his face.

I was often told by fellow executives, "Your father is a man of virtue." He might have been the kind of person who reached out to those he felt were in trouble in his heart. Everyone around him felt at ease.

Above all, the fact that my father sowed the seeds was significant. I graduated from university in 1975, joined Nomura Securities that year, and stayed until March 1977, which was a truly great experience.

After leaving, I studied abroad at Cornell University Graduate School for two years. In 1977, before I left, the annual sales of the restaurant business were 1.3 billion yen. In terms of the number of stores, it was about 15. When I returned in 1980, it had grown to about 2.4 billion yen. Since a restaurant is a business that involves investment, it's not something you should just open recklessly. I thought this was scary.

At that time, interest rates were very high, exceeding 10% if you borrowed from a bank. If you borrowed 400 or 500 million, you wouldn't be able to pay the interest, and it would be a disaster. So I said that for the restaurant business, if we were to open a store, let's think about how to make it profitable before opening it.

Even though I was still young, I said, "If we keep doing this, the company will go bankrupt. What are you going to do?" This bought some resentment, but in the end, several people followed me, and the restaurant business's sales grew tenfold over the next 20 years. Green House's business was 15.7 billion in 1988.

It was 1988 when I told my father, "I'm thinking of going public." He said, "That's fine. Do it." I said, "If we go public and fail, we'll have to sell the company." He replied, "Well, I started from scratch with nothing but my own two hands. I can just do it again from there."

That suddenly gave me a lot of motivation. I felt I had to work hard if he said something like that. So I prepared for a little over a year and was able to go public in 1990. After going public, we were able to recruit very good talent, and we grew significantly over the next 10 years.

In 1999, Carlos Ghosn came to Nissan, and Nissan Motor sold off all related companies like restaurants and cafeterias that were not directly involved in their core business. We took over the restaurant and cafeteria business divisions. We decided to invest 65%, with Nissan Motor holding 35%, and took charge of 1,300 employees. After that, we did M&A through outsourcing for large corporations in that manner for 17 cases.

One major milestone is the overseas business. In 1991, someone from the LG Group in South Korea came to Japan and asked if we would partner with them because they wanted to start a mass-cooking catering service business in Korea. We gave them all our know-how, and it is now a 150-billion-yen business.

Later, in 2001, they said, "Japanese food will be very interesting from now on, so we want to do a restaurant business." When I introduced "Saboten," they were very interested. Now, Korea has 70 stores with store sales of over 5 billion, making it our largest overseas operation.

The overseas restaurant business currently has 127 stores in 10 cities across 8 countries. These sales are about 12 billion, but if you include food services like employee cafeterias and the hotel business, I think the overseas business will grow even more.

That is definitely the point. For overseas business, I believe it's important that the owner is willing to meet you pleasantly when you first go out, and whether the chemistry matches. You must not get this wrong. It's best if you meet good people and find a good partner you can truly work with.

We have good partners in Thailand and Taiwan, and things are going very well. While Japanese companies are currently struggling to enter China on their own, we have opened about 10 stores in China together with a Taiwanese company, and the performance is very good.

After all, if growth is the only goal, it won't go well. We create an environment where the employees we work with feel good about their jobs and can work toward the same goals in the same environment.

Another is the hotel business. It's now in its 20th year, and we have also started a hotel under our own brand called "Grand Bach." Also, in Okinawa, we are currently running two hotels with 450 and 200 rooms. Since inbound tourism is increasing, hotels will continue to grow depending on differentiation.

In addition to those, there is the healthcare business—selling health through food, a food business for the elderly and hospitals. Among the markets that will grow globally is the world of healthcare that considers health, including dieting. Healthcare for the elderly, in particular, is seeing increasing demand worldwide. In fact, this is the fastest-growing area in our company.

Yes. Hospitals still have a lot of directly managed patient meals, but since insurance points are being reduced, it's difficult to manage them directly, and they are increasingly entrusting meal provision to outside parties.

Another area is high-end welfare facilities for the elderly. Companies like ORIX, Tokyu Land, Mitsui Fudosan, and SECOM are building these facilities. People enter while they are healthy, and in the end, they receive up to 24-hour terminal care. The most important thing there is the meals. We have a high share of this, currently about 70%.

What happens in Japan from now on will happen in every country. China, in particular, will be full of elderly people in 10 years. So, using Japan as a model, I think this business will grow tremendously overseas in the future.

Furthermore, in terms of healthcare, there is something called "record dieting." Our diet app called "Asuken" is currently gaining 10,000 members a week.

As of July 1st, 1.38 million people are using it. "Record dieting" involves recording the meals you eat by taking photos with your smartphone and sending them. In "Asuken," calories and nutritional values are automatically calculated, and an animated female nutritionist gives advice on the screen, such as "It's better to eat this way." If you continue for three months, you generally lose about three kilograms. In terms of "record dieting" apps, our company is probably the largest in Asia.

My cousins are the same, but everyone around me was Keio, and there were always Keio graduates close by. Even though my father was Waseda (laughs).

That's right. I felt something more than just familiarity with the scenery of Hiyoshi that I had been seeing since I was a child. The environment is great, isn't it? This April, my daughter entered Keio Business School. My two sons have been there since the elementary school (Yochisha). I don't know why, but it just happened naturally (laughs).

Until my second year of university, I was in a tennis club called Alex and worked hard at it. Another thing was that I joined the Mita Record Appreciation Society. If you bought through the Mita Record Appreciation Society, you could buy records at a 30% discount back then.

Yes. One time during high school, a very good piece of music was playing from the audio-visual room. It was Bach by Karl Richter, a famous organist of the Munich Bach Orchestra. I fell in love with that organ piece. My love for Bach grew so much that I named the hotel "Grand Bach" (laughs).

That's right. People like Yoshiharu Hoshino and Yoshinori Isozaki of Kirin HD.

In Japan, there is something called the Cornell Hotel Society, and I have actually been the chairman for 15 years. Before that, Ichiro Inumaru of the Imperial Hotel, who was a Keio University alumni, did it for 20 years.

This society provides opportunities for friendship where you can meet new people and various others, and it's a truly great society for me.