In the 1970s, a Japanese businessman by the name of Den Fujita had the proverbial ‘opportunity of a lifetime’ in his hands.
He had an agreement with Ray Kroc, then president of McDonald’s, to bring the fast food chain to Japan under a 50/50 JV — a partnership that would soon evangelize the gospel of the Golden Arches all throughout the Land of the Rising Sun.
But he had one problem – Mitsukoshi, the department store Fujita had chosen as the location for the first branch of McDonald’s Japan, only allowed him 39 hours over a holiday to get the construction done.
So when Ray Kroc arrived in Japan 3 days before the opening, he was shocked to see that nothing had been done.
But Fujita didn’t sweat. He was not a man to be caught without a plan.
He had rented out a warehouse and got his team to practice putting it together in record time.
He turned the store around in under 36 hours, and the first McDonald’s in Japan opened successfully.
From 1971 to 1999, Fujita opened 3000 locations in Japan. That’s about 2 McDonald’s per week for 28 years.
There are a couple of ‘takeaways’ (pun intended) for property investors from this story:
1. Timelines are negotiable
When we get an estimated timeline for the build from contractors, we sometimes take it at face value. But there are usually many ways to speed up the build. Maybe there is a bottleneck we can remove. Maybe we can incentivise the contractor to prioritize this job. Maybe the order of works can be switched around. Perhaps we can’t rent out a warehouse to practice superfast renovations (or can we?), but there are usually creative solutions around time constraints.
2. To scale, standardise
3000 restaurants in 28 years. This kind of scale would not have been possible without standardisation. Whatever opinion you may have of McDonald’s, they have their systems dialled in – from operations to logistics to production. Every restaurant is on brand, and their product is consistent.
3. The right Joint Ventures leverage each other’s strengths
Ray Kroc could not have done what Fujita did in Japan. But Fujita alone could not have made McDonalds what it is. Theirs was a true partnership where 1 +1 = 11
Hope this gave you some insights to apply to your next project.