Since 1969 Suzette has been striving to become the Grande Maison of Sweets, ensuring products that make their customers smile.
Japanese food-related exports and restaurants have seen unprecedented record-breaking numbers. We have also seen this growth reflected in Japanese confectionery and bread. For example, the Japanese bread market is expected to reach USD 21 billion with a CAGR of 1%, while the confectionery market’s CAGR is expected to reach 1.33% at the same time. Given this, can you tell us about the trends and opportunities that are emerging for Japanese food products and Japanese confectionery and bread? How has the global interest in Japanese cuisine influenced the demand for these products?
In answer to the first question, we have a factory in Singapore, so we do not export our products as for fresh cake to foreign countries. When it comes to our industry in general, Asian tastes are very popular right now. The reason for this is that apart from Japan, Asian countries prefer vegetable oils rather than butter or cream, as they do in France. Japanese people love to eat butter and cream. This influence came from Western countries such as the US and those in Europe 50 or 60 years ago. Today, butter and cream are typical for Japanese people. However, while they are not typical for other Asian people, they are beginning to accept butter and cream. This is very important for our industry, and this will give us opportunities to expand our business.
The challenges facing Japanese companies come in different forms. For example, Japan has a population crisis, and it is expected that the Japanese population will fall below 100 million by 2050. On the other end of the spectrum, we have the “2024 problem,” which is a logistics-related issue where it is expected that 940 t worth of goods will no longer be transportable by 2030. The consequences of these issues are two-fold. Firstly, it equates to a diminished domestic base, and secondly, it will limit the Japanese food industry’s ability to source goods and transfer goods across the country. You mentioned that your factory is in Singapore. Could you tell us how your company is tackling these challenges in-country, and do you sense any opportunities amid the crisis?
In Japan, we still have a population of over 100 million people. There is room for us to develop when it comes to e-commerce and the international market. Also, the increase in inbound tourism offers further opportunities in Japan. However, more is needed, and just as we are doing in Singapore, we must develop and further expand overseas. We are seeing buyers and department store staff from Southeast Asia regularly visiting Japan to check and monitor the shops here. It is, therefore, very important to have showcases that attract their interest.
We already have a strong presence in Singapore, where we have six stores. There is great potential and a lot of opportunities overseas. We directly operate our shops and factories in Singapore. They are not franchises. This is quite unusual for Japanese SMEs and even large corporations. Even if we do turn our Singapore shops into franchises, Singapore will be a crucial base for us going forward. We are currently considering expanding into Thailand, Dubai, and Hong Kong. All of my family members, except me, have actually moved to Singapore. My eldest son is also living and attending school in England.
Are you planning to expand to Thailand, Dubai, and Hong Kong through franchises, or will you do it alone?
We have yet to decide. The next location we will expand into is Thailand. We plan to do so next year. Depending on how it goes, we will decide on franchises or direct cooperation. We also could combine both. My wife serves as the overseas president of the company.
What we do differently from other companies is that the owners of our business attend the business meetings, which leads to quick response times. That is one of our strengths.
You just mentioned internationalization. As you know, internationalization is key to enabling diverse product offerings, enhanced operational efficiency, and expanding a company’s reach. You have demonstrated your international pedigree with your six stores in Singapore, and you just mentioned that you would like to expand to Thailand, Hong Kong, and Dubai. What were the reasons for specifically highlighting these three countries, and which markets in general do you believe have the highest growth potential outside of Asia? Where would you like to continue your expansion outside Asia in the future?
When you consider the market size in Southeast Asia, Thailand and Hong Kong look promising. Also, when I decide which country to choose for expansion, I choose one of my favorite countries. For example, when we decided to open shops overseas ten years ago, I traveled to around ten countries, including France and Indonesia, by myself. I noticed that some countries were kind to Japanese visitors. It is important that the local population like Japanese people. Otherwise, it would be difficult to be successful. When I returned to Japan, I asked my acquaintances at a consulting firm which country among my favorite countries had a large confectionery market. The first was Singapore. Thailand and Hong Kong came in second. That was how I made my selection.
Dubai is an exception. When I was in Dubai, I witnessed a large number of men enjoying cakes and coffee. My wife also loves Dubai. She saw a lot of European women working there. Instead of making money in their home countries, they decided to move to Dubai to work. My wife got the impression that Dubai was fair to women. We are considering expanding our business to Dubai in the future.
When it comes to expanding outside of Asia, I am not currently thinking about that. I spent 9 months in France. I have deep respect for the US and Europe. When it comes to confectionery, France and other major European nations have high-quality confectionery brands. In Japan, our products are often purchased for business purposes such as greeting gifts. While this is favorable for tourists, it is tough for business people.
Suzette’s origins are in Henri Charpentier, which began in 1969 as Salon de thé, a café where customers could savor the exquisite sweets that were made in Ashiya, Hyogo. Nearly five decades later, you have continued this legacy of exquisite craftsmanship through your brands, Henri Charpentier, C³, Casaneo, and Backhaus Irie. How do you foresee the evolution of Suzette over the next five years?
First of all, we need the industrial knowledge and technical abilities of the major companies. We remain a small confectionery shop. However, it was for that reason that we were able to foster our craftsmanship. We applied the Toyota Production System to increase the efficiency of our operations. We also value craftsmanship very highly. That led to the success of our Central Kitchen in Singapore. Our attractive and intricate decorations come from the work of our craftsmen. We want to maintain this organization. The method has stayed the same since 1969.
It amazed the Singaporeans that we had yet to adopt a major commercial strategy. We refer to our strategy as analog professional culture and we have chosen to remain that way. We want to maintain this style when we are developing and exploring new markets. This attitude of steadily expanding little by little is our strategy. That will be how we advance in the future. Nowadays, simplicity, speed, and digitalization are admired. However, that could result in a dead end and eventually force you to turn back. We have achieved annual sales of JPY 27 billion, which indicates that we have done something right and are moving in the right direction.
We are looking at international airports for our new outlets. Those are areas where we would like to sell our chocolate and cookies and areas where we could use digital technology in the future. We want to combine the power of speed with our own analog culture and become a unique and interesting presence in the world. For example, there is a French company called FAUCHON which specializes in delicatessens, patisseries, teas, confectioneries and chocolate. They combined their manufacturing line with an automated factory, which gave them their own unique style. I really liked the direction they were taking.
In your message on the company website, you mentioned that your company is aiming to become one of the world’s “Grande Maisons of Sweets”. What type of in-store experience can your customers expect when they visit your stores and your “Grande Maison of Sweets”?
I need help pinpointing whether it is the Japanese way or the Suzette way. We do not have a manual for service. I can only say that it is our traditional way. Japan’s food business holds a very high position when it comes to worldwide standards. Naturally, our traditional way has been polished in this respected position.
We were able to maintain our service style in Singapore. Interestingly, in Singapore, the food business is considered low. We were able to overcome that impression. Developing our service style worldwide will be effective.
Your company blends culinary precision with Western dessert tradition and the Japanese mentality of making things high-end and embodies the harmonious fusion of flavors, textures, and artistic presentation. A good example of this is Henri Charpentier, who was highlighted by the Guinness Book of Records for selling the most financiers for the eighth consecutive year at present. In 2023 alone, you sold over 24 million financiers. Your record was in 2018, when it reached 29 million financiers. How are you able to create and improve on the synergies for your products?
There are too many reasons behind our success. However, there is one that is my favorite. Enriching and maximizing everything to the limit is the culture in Japan. That was key for the creation of our financiers. In France, financiers are snack foods. My father, who was the founder of the company, learned about these French financiers. He was looking for something that could be adapted for department stores in Japan. Until then, financiers were not very special. Our company looked at the ingredients and created something suitable for Japanese department stores.
We transformed the financier from ordinary snack food to luxury snacks. Today, they contain expensive flour, eggs, and butter. We read the recipe and increased it to the maximum. It was exciting because these financiers became very popular in the department stores. Now, the French are following suit. The roots of financiers are in France and Italy. However, Japan is the root of luxurious financiers. Japanese traditional thinking led to the success of the financiers. When our record was published in the Guinness Book of Records for the first time, the French ambassador provided us with an opportunity to organize an anniversary party at his residence in Japan.
Your company has collaborated with Ninben to make a dashi-flavored curry pie and with ANA FESTA to make Bananaana, an STG-friendly sweet. This year is also the ninth consecutive season that you have been an official partner of the football team Vissel Kobe. Are you looking for any new partners domestically or internationally in terms of new locations, B2B partners, sourcing ingredients, sports teams, etc.? Also, are you planning to continue your international expansion with partnerships?
We do not have anything particular in mind right now. However, one thing for sure is that our factory requires a lot of manpower, as do our stores. It is, therefore, important to keep looking for partners who empathize with us. There are some exceptions. Our community contribution activities are not just a corporate social responsibility. They are more than that. It is all about creating shared values. For example, we provide financial help to farmers in Hokkaido to maintain their agricultural activities. We also give scholarships to culinary school students as they are our industry's future. Some of these students have gone on to work at our company. We win, and they win, too. CSR can only go one way. However, if it is CSV, it will be more sustainable. Based on that, we can create a win-win situation. Japanese workers are very enthusiastic when it comes to CSR activities.
Your company is celebrating its 55th anniversary this year. Imagine that we come back five years from now for your 60th anniversary, and we have this interview all over again. What would you like to have achieved by then, and what message would you like to convey to our readers?
Artisans make things by hand. This contains the truth. If we survive the next five years, we will look back and know that we must have done something right. Our artisans will play an important role. Five years from now, I believe that society will be even more digitized than it is today. However, I believe artisans will be best in a society that is so digitized.
For more information, visit their website at: https://www.suzette.co.jp/
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