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SO Project

Benihana of Tokyo
Group 6
Submitted by
Ankit Kumar Varsaney (14PGP071)
Abhishek Sharma (14PGP062)
Choudhari Amit Prakash (14PGP012)
Ronit Kumar Jena (14PGP112)
Sanjeet Sahu (14PGP111)

Table of Contents
Business Model & its Assessment...............................................................................3

Indian Institute of Management Raipur

Business Model & its Assessment

1. How would you describe Benihana's business model? What's your assessment of it?
Benihanas business model is totally focused on providing the experience to its customers, which
he observed during his initial phase in United States. As Rocky explained Americans enjoyed
eating in exotic surrounding but were deeply mistrustful of exotic foods. I also discovered that
people very much enjoy watching their food being prepared. After observing behavior of his
target customers, he decided to incorporate hibachi table concept into operations. Adding on to
enhancing the customer behavior, he focused on improving the internal environment for which he
designed the entire environment in the vernacular form.
Rocky paid attention on two pain points of United States restaurant industry to make his business
model successful. First was the availability and cost of the labor. To solve this issue, he brought
his employees from Japan. They were highly trained and very efficient in their work. This
strategy was also adding a flavor in employee interaction with customers. Second was related to
food storage and wastage, which contribute significantly to the overhead of the typical restaurant.
For this, he limited his menu to only four items, which helped in reducing the cost up to 30%35%.
Business Model:

Indian Institute of Management Raipur

Analysis of all business model elements is as follows

1. Customer Segments: Targeted customer for Benihanas restaurant was business traveller and

leisure customer who can spend 45 minutes to an hour in Japanese environment.

Value Proposition: Benihana has created value for its customer by providing traditional
Japanese environment within the restaurant and by simplifying its operation. Simplification of
operation has been done by eliminating the kitchen area from the layout and fixing it on each and

every dining table on which specific cook will be serving for individual client group.
3. Channels: In the initial phase of their operation in United States, Benihana was functioning with
fully owned restaurants. But later on to expand in various markets, Benihana opted franchise
model in which investors used to invest their money. Benihana used marketing channel to reach
its customers by means of full-page outstanding advertisements in newspaper and magazines in
its targeted markets.
4. Key Activities: Benihanas major activity was to serve quality food to its customers with limited
items in its menu, which was helping in reducing the waste and increasing the efficiency of
employees. Management of all the restaurants and theirs resources was critical activity for
Benihana. In addition to this, Benihana had to manage its employees as they were bringing their
employees from Japan. So Benihana had to develop them to ensure quality and smooth operations
of the restaurants.
5. Key Partners: Major partners for Benihana was the raw material suppliers who were supplying
all the raw materials to its restaurants and carpenters who are designing and making the interiors
of the restaurants according to Japanese traditional designs.
6. Cost Structure: Elements of cost for Benihana includes: Raw materials, Salary, Marketing
expenditure, bonuses to managerial employees and initial investment in development of
restaurant infrastructure.
7. Customer Relationship: Relationship with customers was insured by providing personal
assistance to all the customers by providing cook on each and every table of the restaurants.
Benihana enhanced this relationship by taking their feedback and improving based on that.
8. Revenue Stream: Benihana had two sources of revenue. One was the combined sale of
beverages from bar and sale of food from hibachi system. Second was from the franchise outlets
of the Benihana in which they had shares based on sales.
9. Key Resources: Benihana had resources in the form of physical assets of all the restaurants and
its employees, which were brought from Japan and developed in United States by Benihana by
providing them training of 6 months period.

Indian Institute of Management Raipur