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Tadatoshi Suzuki, President of Shirokiya, The People's Store

By Susan K. Sunderland

Michelle Wie is spotted in the food department. Senator Daniel Inouye is a customer. Your grandmother and aunty get omiyage there. Tourists marvel at its Asian artifacts and beautiful kimonos. You first tasted Beard Papa’s renowned cream puffs there.

What makes Shirokiya special: unusual Japanese goods, foods you can't find anywhere else, and great deals on electronics. No wonder they call Shirokiya the people’s store.

The popular store at Ala Moana Center is a one-of-a-kind gem that was doomed to extinction four years ago. The once Japan-owned store is now locally run and seeking its rightful place in Hawaii’s evolving retail mix. Like other long-standing establishments, it’s easy to overlook its significance and take for granted the fact that it’s always been here.

But Shirokiya’s story is destined for retail folklore. It’s an example of how the power of the people saved a cherished entity in our community.

Business downturns and global events have caused many landmark enterprises to become mere memories. Wisteria, Columbia Inn, K.C. Drive Inn, the Ranch House. As Press Club members lamented at a recent Gridiron show to the tune of Anything Goes, “everything’s gone.”

But can loyal customers convince a corporate monolith that pulls all the purse strings to save a local business?

We put that question to Shirokiya president Tadatoshi Suzuki, who heads the local ownership that acquired the store in 2001 and made retail history.

But first some background.

Hikotaro Omura opened a notion store at Nihonbashidori, Edo (now Tokyo) in August 1662. This was the beginning of Shirokiya, Japan’s oldest department store. In 1958, Shirokiya was purchased by a larger Japan-based department store. The following year, the first branch of Shirokiya outside of Japan opened in Hawaii’s brand new Ala Moana Center.

In 1966, Shirokiya moved to its present location next to Macy’s. Branch stores were opened on Maui and at Pearlridge, but closed in 2001.

When parent company Tokyu Department Store Co. of Japan announced it would close Shirokiya’s flagship store at Ala Moana Center, the local community put up a fight. The state Legislature issued a resolution and 40,000 loyal customers signed petitions to protest the closing.

Forty years of aloha and goodwill for the Japanese imports store were not to be denied. Tokyu took a $23 million loss and sold Hawaii’s Shirokiya store at Ala Moana Center to local management.

Continuity and business-as-usual for customers were main concerns of the seven new local owners. Yes, the corporate structure was changing dramatically, but it couldn’t interrupt customer service. No one was to feel insecure about where their next seafood bento, Yoku Moku cookie, or surround-sound, high definition TV was coming from.

Shirokiya has been here for Hawaii’s shoppers since the start of statehood. The first 23,000-square-foot store was on the ewa-street level where the Post Office now stands.

Suzuki recalls that the original store was “museum-like” and displayed exclusive artifacts, kimonos, and collectibles. It was Tokyu’s daring foray into the U.S. retail market when made-in-Japan products still had a negative image.

Four years after operating in the red, the store hired local buyers to change the mix of merchandise. That put Shirokiya on the course to profitability, and it enjoyed steady growth in ensuing years.

Catering to both tourists and the local Japanese community, Shirokiya has never changed its mission and niche. The Japan imports store carries a variety of food, artifacts, electronics, houseware and gift items, and regularly holds cultural fairs and demonstrations. It takes on the character of a trade fair when demonstrators are brought in to exhibit Japan-made products. The made-in-Japan stigma has changed.

Food fairs, destination promotions, and demonstrations have distinguished Shirokiya’s retail image and branding for many years. It’s a focus that will continue under the new owners.

According to Suzuki, the key to Shirokiya’s survival is its loyal local customer base, which generates 80 percent of its sales. Gross annual sales are about $35 million.

It is a niche on which the local owners hope to build the store’s future and its legacy. Though quiet and humble in their approach, there is an underlying samurai spirit among the management that transcends challenges and fierce competition.

As Suzuki emphasizes, Shirokiya’s formula for success is simply giving customers what they want.

“We listen to our customers and bring in the type of items they want,” he says. “When I’m out in the community, people approach me to tell me what they like and don’t like at the store. We value customer feedback.”

Indeed Shirokiya’s customer bond is special. Shirokiya is said to be more than a store. It is a link to cultural roots and a showcase of authentic products and artistry from Japan.

The store is acclaimed by government officials for bridging “cultural understanding between East and West, and enhancing Hawaii’s position as the crossroads of the Pacific.”

That is lofty praise for a retail enterprise just trying to keep customers happy and its shelves stocked with uniquely Japanese merchandise. As its marketing slogan states, Shirokiya is a “world of difference.”

In that world are 180 employees. Four owners are in Japan and three are based in Hawaii. The Hawaii owners are Suzuki; Walter Watanabe, director-store manager, and Fumiya Matsushima, director.

Suzuki was sent to Hawaii from Japan in 1967 to manage Shirokiya’s food and toy departments. He stayed until 1971, then went back to Japan. He returned to serve as general manager and vice president from 1976 through 1984. He was with Tokyu-owned Saint-Germain Bakery as director of the overseas division from 1985 to 2000, then was called from retirement to oversee Shirokiya Hawaii.

Watanabe joined Shirokiya in 1974 when he was a UH student. The Baldwin High School graduate learned to speak Japanese on the job. Matsushima is one of Shirokiya’s original employees from the 1959 opening.

While the new owners are gratified about keeping Shirokiya in Hawaii, the company admits it faces challenges that most retailers today do. This includes the high price of real estate, the tight job market, and the onslaught of Mainland big-box discounters.

It underscores Shirokiya’s determination to “stick to our guns” in offering Japan goods that Hawaii shoppers want. That positioning gives the store a cache and personality that set it apart from others.

Dwight Yoshimura, vice president and senior general manager of Ala Moana Center and General Growth Properties-Hawaii, agrees. He says, “Shirokiya brings a variety of food and merchandise to the customer shopping experience. It is a unique store that shoppers don’t experience elsewhere. It is an attraction in itself and a magnet that draws local customers, first-time visitors, and repeat tourists.”

Shirokiya’s value to Ala Moana Center’s merchant mix was validated in 2003 when General Growth extended the store’s lease for 15 years.

As the holiday season approaches, one is reminded of unique shopping experiences. While Island venues and choices are varied, stores such as Shirokiya stir a nostalgic chord with local shoppers. Customers say places like Shirokiya hold special memories, and there’s fond aloha for merchants who have grown up with Hawaii’s generations of shoppers.

Shirokiya hopes shoppers will kindle this renaissance spirit during the holidays. Suzuki and his team have the traditional Maneki Neko (lucky cat) posed to welcome old and new shoppers.

Incidentally, this year Maneki Neko has gone high tech. A solar-powered cat that waves continuously to lure customers is available at Shirokiya.

’Tis the time of year when immaculately wrapped gift packages of rice crackers, tea, confections and cosmetics also are big sellers. Japanese lacquer ware is popular as well, such as the musical jewelry box that plays Sakura. In the electronics department, there’s a new wireless TV that defies connectivity hassles, with Internet and e-mail streamed from a base station.

Shirokiya expects brisk business in its electronics department this holiday season. Electronics is its highest revenue producer, owing to high-ticket items such as digital cameras, audio equipment, computers, stereos and TV sets. Store manager Watanabe just hopes inventory from the local distributors can keep up with demand.

Downsizing and restructuring has affected major brands such as Hitachi and Toshiba, which have closed offices in Hawaii, affecting product availability and servicing.

Fortunately, Watanabe says, “We have very knowledgeable staff that are well-versed in the products we sell. It’s an important part of our ongoing service to customers.”

That’s consistent with the customer-friendly atmosphere Shirokiya aims for in all of its departments. Customers feel at home at “the people’s store”. They watch football games in the TV department, slump in leather chairs for a relaxing massage, and sample food when they’re hungry.

The food department keeps growing to meet the needs of customers who want portable meals and Asian ingredients to cook at home. Special promotions occur every 13 days.

For instance, now through Nov. 27 food demonstrators are offering Yonehachi okowa, Japanese sweet rice with seasonal vegetables. The next food event will highlight confection mochi from Tokyo, and tenmusu (rice balls with flavored shrimp) from Nagoya.

“Shirokiya has become a popular place for demos,” Suzuki says. Artisans and food demonstrators “talk it up” in Japan if they’ve done well in Hawaii. The company’s office in Japan is frequently contacted by Japanese merchants wanting to showcase their products in Hawaii.

He adds, “We can’t duplicate what they do in Japan, especially in food products. That authentic flavor is part of the Japanese culture.”

Many products make their America debut at Shirokiya before expanding to other markets. Hawaii’s ethnically diverse customers are testing subjects for the Western palate.

It further reinforces Shirokiya’s unique niche in Hawaii’s retail market. The local owners know it’s important to keep focused on their basic mission of providing quality Japan imports to local customers.

Suzuki reflects, “The people wanted this place open. We’ll take it as far as we can go, although the future is hard to predict. Right now we are focused on stabilizing profitability.”

Can an establishment survive and respond to changes based on something as simple and fundamental as customer loyalty? Suzuki hopes customers will reflect on that the next time they walk into Shirokiya. The store is still here because of the aloha spirit of Hawaii’s people.

It’s something to rejoice during the holidays.


Posted: November 25, 2005 @ 10:02 AM HST

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