Sushi is one of the most delicious dishes on the planet. If I could eat sushi for every meal and not die an untimely death from mercury poisoning, I totally would. Unfortunately, sushi is rather costly, and is often treated by diners and adventurous eaters as an occasional indulgence instead of a routine meal.
Sushi restaurants, however, make a killing on selling their rolls and other sushi-related food items. Though the cost of a good sushi chef can be quite high, but the cost of making sushi is proportionally low when considering portion size and ingredients used — rice, nori (seaweed), vegetables, and fish or seafood. This is why good sushi restaurants stay open for long stretches of time and make a considerable markup on their items.
While investors often like to talk shop and make deals over a sushi power lunch, they haven’t really been able to invest in sushi other than buying it in mass quantities or buying a restaurant. Thanks to a soon-to-launch IPO, however, you will soon be able to actually invest in an up-and-coming sushi chain.
Sushiro Global is a conveyor belt sushi chain in Japan. It will also become a publicly traded company soon.
Unlike traditional sushi restaurants, conveyor belt sushi chains (or Kaiten-zushi) sell sushi at lower prices on a conveyor belt (duh). Instead of charging high prices per dish, restaurants like Sushiro rely heavily on selling large volume of their dishes. Sushiro happens to be the most popular of the conveyor belt sushi restaurants in Japan, which means they have the best sales, too.
Sushiro is planning to go public and sell stock in their company.
By filing for IPO at $730 million, Sushiro Global Holdings can expand their network of sushi restaurants by selling stock and raising money. This means that sometime soon, you can (probably) buy stock in one of the biggest sushi chains in Japan. It’s worth noting that Sushiro, which is owned by Japanese and European investors, was previously purchased by Unison Capital (another Japanese company) in 2012. They were able to cut costs on fish and seafood, making the restaurant chain more profitable in the process. By going public, Sushiro hopes to increase locations, profitability, and their presence in the Japanese restaurant industry.
Sushiro isn’t the first sushi restaurant to go public.
Genki Sushi is another sushi restaurant that trades on the Tokyo Stock Exchange. Like Sushiro, they are also a conveyor belt sushi restaurant, though they have locations all around the world. In the last year, however, Genki’s stock only increased in value by .26%, though they’ve made much larger increases since the beginning of this year. Kona Grill ($KONA) is an American chain that serves sushi, but calling them a sushi restaurant is an insult to sushi restaurants.
Should you invest in Sushiro when they go public? Sushiro’s business model and management allow them to sell cheap-ish food at exceedingly low costs. They’re popular enough to keep opening locations and prospectively open more in the future. Genki, their competitor, has already gone public and steadily increased in the last few years on the market.
If you think Sushiro’s business model will lead them to succeed and expand in the future, you might want to do your research before you invest. If you think investing in restaurants is bad news, consider other sectors (like the entertainment or tech industries, for example).