Shirokiya owners striving for profit
| • | Shoppers crave Shirokiya's cultural fix |
By Andrew Gomes
Advertiser Staff Writer
Shirokiya got a new lease on life Thursday evening as a management group bought the specialty department store at Ala Moana Center from Japan-based Tokyu Department Store Co. But sustained financial health was not part of the deal. That is a challenge still facing the retailer.
Turning losses into profits will be up to the new owners and a team of about 150 employees who now hold the company's future in their hands.
"Our main concern is to make Shirokiya profitable within the next couple of years," said Walter Watanabe, Shirokiya's assistant manager who has been with the company 25 years. "It will depend on teamwork."
Over the last year, Shirokiya has cut expenses and adjusted merchandising to trim losses by half. But the company, which declined to reveal dollar figures, still has further to go.
To get there, Shirokiya will be focusing on expanding its Japanese arts and crafts department, putting more emphasis on food, and continuing a strategy to find new high-end Japanese products.
Tadatoshi Suzuki will lead the turnaround effort as Shirokiya Inc. president and chairman of the owner group. He is a former Shirokiya vice president and general manager in Hawai'i.
Suzuki, who was with Shirokiya here from 1967 to 1971 and from 1976 to 1984, will come out of retirement and move back to Hawai'i later this year.
The 66-year-old is a picture of health, according to Watanabe. Although he has been away from the company for 17 years, Suzuki, who was also a director of Tokyu subsidiary and Shirokiya tenant St. Germain Bakery, is inherently familiar with the business.
Other key personnel will be local Shirokiya employees who regularly visit Japan to select merchandise that fits the Hawai'i market. "That is key," Watanabe said. These buyers will be assisted by a new trading office in Japan for purchasing goods and shipping them to Shirokiya.
Watanabe said Tokyu had a trading office that will be closed. But one of its managers is forming his own operation to sustain the supply chain. "We still have our avenue," Watanabe said. "Merchandise will be able to flow without any problems."
The merchandising strategy Shirokiya is employing involves a shift away from things like luggage and name-brand fashion accessories to premium-quality goods from Japan, such as elaborate Kutani vases priced as high as $6,000, wedding kimonos for as much as $650, and $250 swords.
An expansive Japanese electronics section will continue to be one of Shirokiya's staples. The retailer also will continue to import seasonal items.
The half-dozen or so "Bussanten" — prefecture fairs showcasing sights, sounds and foods of different prefectures in Japan — will carry on. The Hiroshima Fair started on Wednesday and runs through April 8. Fukuoka, Niigata and Hokkaido fairs will be held in May, June and July.
Shirokiya will emphasize food products more, including its tea boutique and Minamoto Kitchoan confections.
Beside the merchandising strategies, paring Shirokiya to one store from three also will help the new company move toward profitability. Tokyu closed its Pearlridge Center store March 18. The Maui Shirokiya will close at the end of May. Watanabe said the two stores did not make money.
Starting debt-free will also improve Shirokiya's financial viability. Although terms of the purchase were not released by the new owners of the company, Bloomberg News reported that Tokyu sold Shirokiya for $1 and took a $23 million loss.
Shirokiya's new owners said they are grateful that Tokyu recognized the significance of specialty department store in Hawai'i and were willing to give them the opportunity to maintain it.
Shirokiya represents a cultural link for many local Japanese, including Watanabe's nisei parents, who live on Maui. "It reminds them of their roots," he said.
Andrew Gomes can be reached by phone at 525-8065, or by e-mail at agomes@honoluluadvertiser.com
