Nakato Hirakubo, Brooklyn College Caroline Chen, San José State University George Whaley, San José State University Craig Davis, Ohio University
Ikinari Steak: Reflections on a Failed Foreign Market Expansion
Case Overview Kunio Ichinose opened the first Ikinari Steak restaurant in Ginza, Tokyo, in 2014, and it gained instant popularity. The standing-only fast-casual dining format was successful, so Ikinari Steak expanded locations, and revenues grew. Kuni Corporation, the parent company that owned Ikinari, Pepper Steak, and other restaurants, decided to expand in the United States. The first Ikinari Steak in the U.S. opened in Manhattan's east village in February 2017. Rapid expansion in Manhattan was planned over five years, and eleven locations were opened by 2018. However, the standing-only fast-casual dining format was not popular in the United States, and Kuni Corporation closed nine locations. Year-end 2019 is the case decision point. The case focuses on the domains of business strategy, marketing, and cultural differences in consumer tastes in the fast-casual dining restaurant category in the U.S. The case ends with Kunio Ichinose contemplating what went wrong with his rapid expansion in the United States. The case covers the significant factors contributing to Ikinari Steak's failed business model in the United States. Specifically, it covers what impact U.S. steak consumer tastes had on the standing-only fast-casual dining business model, the viability of the product mix product strategy, and why the approach was not successful.