Mitsubishi is one of the world’s largest companies with business divisions in a wide range of different market segments and industries. The organization was developed in the late 1800s and quickly diversified into a number of businesses starting with shipbuilding, mail service and mining.
The company was heavily involved in the Japanese war effort during World War II and the following was disassembled. By the mid-1950s, the organization began to take shape again and was slowly put back together, by 1954, Mitsubishi was officially back in operation. The company then began to expand with new offices in 14 different countries and entryway into new industry segments such as banking and trading.
One of the Mitsubishi business divisions is what is defined as the Living Essentials Group which focuses on products, services and other consumer goods. Through this division, the organization developed a subsidiary under the brand Jalux. Jalux is also involved in a wide range of products and consumer markets, one of which was a speciality sweet and confectionary retail brand called J. Sweets. The brand consisted of products that originated from the Japanese market but had appeal throughout the Asian markets. The model had been originally proven in a single Los Angeles retail outlet.
The J. Sweet brand was successful, but needed scale to be able to purchase products at less cost and advertise the brand on a broader scale more efficiently. Although the Japanese American market was the “low hanging fruit” for the J. Sweets brand, there was a much larger market that just needed to be educated and shown how great the product line was and introduced to the brand.
In 2013, Mitsubishi hired Franchise Marketing Systems and Christopher Conner to develop the franchise model and create a franchise prototype that could be developed throughout the United States. The Franchise Marketing Systems team worked closely with Jalux management to conduct franchise research and develop a franchise business plan.
Market demographics were reviewed for the current customers to understand how far people were travelling and what primary demographics were for the key customer base. Retail locations for J. Sweets were very high-end and a bit too expensive for broad scalability, the model was toned down and stripped down to only what was necessary to make the model work and allow for a lower initial franchise investment. Franchise Marketing System’s team developed the franchise business plans for both the franchisor and the franchisees who would invest in the J. Sweets business model.
Franchise Marketing Systems completed the franchise feasibility study and presented it to Mitsubishi’s management team. Retail and confectionary products had performed well in the U.S. franchise market in recent years and there were no brands that focused on the Asian population throughout the U.S.
The opportunity for the brand to scale was significant and given the strong backing, credibility and significant market for Asian-American products, but the Franchise model would require a focused U.S-based team to support growth, deliver training and execute the expansion model. Mitsubishi’s team was not willing to have personnel in the U.S. in order to support this growth.
As a result, Franchise Marketing Systems recommended holding off on a retail franchise model and focusing more on e-commerce as a way to leverage the product lines and develop revenues through online sales.
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