KENKO Mayonnaise Co., Ltd. is a commercial food manufacturer focusing on salads. The company started out specializing in the commercial manufacture of mayonnaise, and using mayonnaise and dressings as its foundation, expanded business to include salads, delicatessen, and processed egg products. Utilizing its consolidated subsidiaries, the company also handles fresh delicatessen for mass retailers. It developed the "Long-life Salad," which boasts an extended shelf life, for the first time in Japan as well as special salads using unconventional ingredients such as burdock and pumpkin. As a pioneer in its industry, KENKO has held the top market share for long-life salad since the product's release. It is ranked 2nd in mayonnaise and dressings, and 3rd in the omelet market. (company estimate based on Fuji Economics' "Food Marketing Handbook").
In addition to KENKO Mayonnaise Co., Ltd., the company group contains 7 consolidated subsidiaries, 10 factories, and PT.Intan Kenkomayo Indonesia, an equity-method affiliate based in Indonesia. The company manufactures and sells products such as mayonnaise, dressings, and processed eggs (seasoning and processed foods business), and its consolidated subsidiaries sell fresh delicatessen, etc. to mass retailers. (delicatessen-related business). The company's production bases are located in Atsugi, Yamanashi, Gotenba, Shizuoka Fujisan, Nishi-Nihon (Kyoto), Kobe, and Nishi-Kobe.
【Company Philosophy (Taken from the company's website)】
"Contributing to the world by providing quality foods"
Our company philosophy indicates the degree of the position of our company group in society. The philosophy has been amended to "contributing to the world by providing good food" (previously 'good food products'). This is because, our activities have been widely expanded thanks to internet as they involve more community activities such as information distribution and food education to local residents rather than only implementing food manufacturing. We continue to contribute to our society through providing various food, service and information on food.
【The Group's Business Philosophy (Taken from the company's website)】
"Body and Mind (mind/body/soul) and Environment"
The group's Business Philosophy shows the passion of our company group based on the company philosophy. We care about the mental and physical aspects as well as the souls of our consumers and other people concerned with our business, who are loyal to our products. Also we devote ourselves to work on environmental issues affecting earth, where the source of our soul (food) grows.
【The Group's Management Policy (Taken from the company's website)】
"To become No.1 Salad Company," "To provide the number one quality products/services in Japan"
The group's Management Policy directs a goal of our company group according to the group's business philosophy. Our goal is to have usual salad become a main cast of our consumers' meal. Moreover, with 'salad' as a key driver to promote the market, we conduct business activities that always relate to salad in attempt to establish a new cuisine genre with Salad. In addition, we are aware of our responsibility to provide food products that are safe, reliable and high quality. To achieve that, we at KENKO Mayonnaise Co., Ltd continue to put our best efforts to create higher quality services.
【Business contents】
The company's business segments consist of the seasoning and processed foods business, which manufactures and sells salads, delicatessen, processed eggs, mayonnaise and dressings; the delicatessen-related business, which is handled by consolidated subsidiaries and deals with the manufacture and sale of fresh delicatessen (salad and foodstuffs with a shelf life of 1-2 days) as well as contract manufacturing within the company group; and others which are the shop business (Salad Cafe) and overseas business.
Sales composition ratios for FY3/18 were 82.6% (82.6% in FY3/17), 15.6% (15.6%), and 1.8% (1.7%), respectively. By product type, salads account for 44.6% (43.7% in FY3/17), eggs 28.8% (28.7%), mayonnaise and dressings 24.4% (24.8%), and others 2.2% (2.8%). By field of sale, convenience stores account for 28.3% (27.9% in FY3/17), dining out such as fast food and family restaurants 26.1% (27.4%), mass retailers such as supermarkets 21.9% (20.0%), manufactured bread 13.5% (14.4%), school lunch services 4.6% (4.8%), and others, such as co-op and commercial cash & carry 5.6% (5.5%).
Seasoning and processed foods business
1 Salads and delicatessen (long-life salad, fresh salad, Japanese dishes, etc.)
KENKO was the first in Japan to develop a salad with an extended shelf life. It is also the first to introduce "burdock salad" and "pumpkin salad" to the world. This long-life salad is a brand called "FDF® (Fashion Delica Foods®)," and is used in restaurants, bakeries, convenience stores, etc. As the industry's first manufacturer and seller of long-life salad, the company takes pride in being the market leader and holding the top market share, and it is continuously striving to develop new products.
2 Processed Eggs (fresh eggs, omelets, Kinshi-Tamago)
The company produces all kinds of processed egg products, such as egg salad to be used in sandwiches and snack breads, Atsuyaki-Tamago (Japanese style rolled omelet) for lunch boxes, Kinshi-Tamago (narrowly stripped cooked eggs) used for cold Chinese noodles, and boiled eggs for Oden soup. In April 2014, the Shizuoka Fujisan egg baking factory began operation. The factory is equipped with an integrated manufacturing line that takes raw eggs with eggshell all the way to finished products.
3 Mayonnaise & Dressings (mayonnaise, dressings, cooking sauces, etc.)
This is KENKO's main business. Since the company's foundation, the company has developed many types of mayonnaise and dressings to meet the demands of professional clients as a commercial manufacturer. Some examples include solidified dice-shape sauces developed for use in frozen foods, and mayonnaise-flavored powder which can be sprinkled on snacks such as potato chips.
Delicatessen-related business, etc.
This business handles the manufacture and sale of fresh delicatessen (daily salads, ready-to-eat foods) for supermarkets and mass retailers. For the main product, potato salad, the company constantly strives to make the most of its ingredients by rotating production areas and offering seasonal varieties, in order to consistently deliver high quality products.
Others
Salad Cafe business
This is the only business in the KENKO mayonnaise company group to have direct contact with customers. Utilizing both the Web and its actual shops, the company relays information to customers, and in turn, customers are able to voice their opinions. There are currently 16 shops, located in places such as supermarkets and department stores found at major railway terminals, as well as within station buildings themselves.
Overseas business
The company exports goods to more than 30 different countries and regions. Demand is expected to rise even further in Indonesia, which has the largest population in Southeast Asia and whose food culture is becoming more diverse due to rapid economic growth. As such, in 2012, the company established PT.Intan Kenkomayo Indonesia. A production facility was completed in 2013, establishing a system for local manufacturing and sales. In 2015, the Vancouver Research Office was established in Canada as a base for collecting food-related information, particularly in North America and Europe. As a market-oriented company, KENKO intends to promptly identify new food cultures and take actions based on this information.
*Overseas businesses are not included in sales because they are affiliates which are accounted for by the equity method.
Manufacturing and sales network (Japan: 7 company-managed factories, and 10 factories managed by 7 consolidated subsidiaries)
In Japan, there are 7 company-managed factories and 10 factories managed by 7 consolidated subsidiaries. The company builds production systems that are closely tied to the region, and one of its strengths is its ability to meet the needs of clients by providing freshness, variable quantities, and customer-specific service.
【Positioning (Source: The company)】
The size of the mayonnaise and dressings market (2017 forecast) is 441 thousand tons by sales volume (up 1.2% year on year), and 202.3 billion yen by sales amount (up 1.0% year on year). According to the company's data, which is based on the "Beverage & Food Statistics Monthly" published by Nikkan Keizai Tsushin, at 15.6% the company is ranked 2nd in Japan in terms of production volume (1st 56.8%, 3rd 13.6%).
The size of the Long-life Salad market (2017 forecast) is 120 thousand tons by sales volume, and more than 61.4 billion yen by sales amount. As the pioneer of long-life salad, the company's market share is 42.7%, a good deal greater than that of the second highest share (2nd 20.2%, 3rd 12.4%).
The size of the omelet market (2017 forecast) is roughly 85.5 thousand tons by sales volume, and more than 61.05 billion yen by sales amount. The company has the 3rd highest market share in the industry at 9.9% (1st 25.9%). Moving forward, it aims to expand its market share.
【Social and environmental activities】
The company engages in environmental management, food education, and contribution to the local community and society, as social and environmental activities.
Environmental management: The company recycles more than 85% of food waste
The Environmental Management Committee formulates environmental goals and plans, grasps the environmental management situation and carries out measures for conservation of the environment, and conducts screenings for zero emissions. The company's factories, Tokyo headquarters, and sales bases, as well as the Environmental Management Promotion Committees at four of its affiliated companies are all engaged in activities to manage compliance, such as waste reduction, energy conservation, working toward zero emissions, and adhering to environmental laws. By removing moisture through desiccation and recycling food into animal feed and fertilizers, the company was able to recycle food waste by more than 85%, with the exception of a few factories. It also made efforts to recycle other waste materials such as plastics and metals, achieving a waste recycling rate of over 90% in FY3/08 and zero emissions at all company factories in FY3/09. The company's affiliates (subsidiaries) also began initiatives in FY3/16, with the goal of achieving zero emissions across the entire company group.
Food Education
KENKO conducts comprehensive dietary education, including cooking classes and seminars on nutrition and eating habits (participants are asked beforehand about what they would like to learn, their worries, etc., and meetings are held to decide the themes, based on the responses). What began as food education for a neighborhood elementary school in 2007 has now grown to include child care institutions, neighborhood apartments, local social welfare services, etc.
Contribution to the local community and society
The company began sponsoring activities in 2006, mainly for events held near the headquarters, which is located in Suginami-ku. The company currently participates in these events and donates its products, and also conducts sponsorship and donations for events at its own factories and affiliate locations. Since 2007, the company has supported the activities of the Japanese national food bank Second Harvest, and in addition to making product donations, it also volunteers in preparing and handing out food on a regular basis. The company has also been on the council of the non-profit organization "United Nations WFP Association (World Food Program) since September 2005, and is contributing to international society by participating in the organization's activities. KENKO has also made a number of other contributions to the community, including fundraising in 2006 for the "Horn of Africa Hunger Relief Campaign" and again in 2007 for the "School Lunch Program/campaign" (for four years up to 2010), funding emergency relief for a drought in the Sahel region of Western Africa in June 2012, fundraising for emergency relief after the typhoon in the Philippines, fundraising for emergency relief for Ebola, and fundraising for an additional School Lunch Program/campaign.
【History】
The company was established in March 1958, and in September 1961 began commercially manufacturing and selling "KENKO mayonnaise AS." The company name was changed to KENKO-Mayonnaise Co., Ltd. in June 1966, and again to KENKO Mayonnaise Co., Ltd. in June 1992. It expanded business to include processed, ready-to-eat foods and processed eggs for salads and delicatessen in order to keep up with the expanding restaurant and prepared foods market. In October 1977, the company released the industry's first long-life salad (Fashion Delica Foods). In December 1986, the company pioneered the fiber boom with original product strategies such as the sale of burdock salad.
The company's stock was registered at the Japan Securities Dealers Association (currently the TSE JASDAQ market) in November 1994. Since then, the company has expanded its domestic production and sales networks. In August 2005, the company established Salad Cafe Co., Ltd. with the aim of using information on trends to develop products and relay information to consumers. The company was listed on Section 2 of the TSE in March 2011, and in March of the following year it was moved to Section 1 of the TSE. KENKO is also carrying out development overseas. In July 2012, PT. Intan Kenkomayo Indonesia was founded in Jakarta, Indonesia, and in July 2015, the Vancouver Research Office was established in Vancouver, Canada.
Achievement of steady sales expansion, profit margin improvement, and financial soundness by promoting the medium-term management plan
The new medium-term management plan "KENKO Value Action" that started in FY 3/19 is the 6th medium-term management plan counting from "KRP 520" (the period from FY 3/05 to FY 3/06), in which the company worked on reforming business. In FY 3/04, there were unprofitable businesses, etc., with sales amounting to 49.2 billion yen, ordinary income amounting to 1.04 billion yen, interest-bearing debt exceeding 11 billion yen. Also, the equity ratio did not reach 20%. "KRP 520" (rebuilding period) started to aim for returning to the established growth trajectory. KRP stands for "Kenko Revival Plan," 520 is the target sales of 50 billion yen, ordinary income of 2 billion yen. The company was striving to stabilize purchasing prices of eggs and salad oils within market conditions, to withdraw from unprofitable businesses, as well as to sell real estate and reducing interest-bearing debt at a rapid pace. As a result, the company achieved sales and profit targets within two years. As expected, earnings fell at the time of the Lehman shock, and there was a disruption caused by the Great East Japan Earthquake, but "DASH SALAD" + "C - 08" (development period), "KVR" (muscular organization) while strengthening its mid-term business plan with "-Medium-Term Management Plan IV 2012-2014" and "KENKO Five Code 2015 - 2017," the company has improved profitability while increasing sales, and realized financial soundness. The Nishi-Nihon Factory was completed in October 2007, and the Shizuoka Fujisan Factory was completed in April 2014. Progress has been made to improve and strengthen the production system and now the company is planning to expand the Shizuoka Fujisan Factory and the Nishi-Nihon Factory for further improvement and to build a new production center based on the establishment of DIETCOOK SHIRAOI Co., Ltd. and KANTOH DIETCOOK Kanagawa Plant Co., Ltd.
