JINYA Creates New Growth Vehicle to Meet COVID Times

March 21, 2021

JINYA Creates New Growth Vehicle to Meet COVID Times

On the cusp of a full-blown global crisis last year, JINYA Holdings knew major changes were ahead.

Marketing Director Justin Bartek joined right before the shutdowns in March 2020, and so did the director of IT and director of training. The group was responsible for preparing the brand for COVID, which was quite the task considering JINYA—which operates JINYA Ramen Bar, bushi by JINYA, JINYA Ramen Express, and Robata JINYA—didn’t have online ordering or agreements with third-party delivery providers. But once JINYA struck a partnership with Aloha, a first-party ordering platform, pieces began falling into place.

Ramen already travels well, so the company began seeing a significant uptick in off-premises orders. Every little piece of strategy helped, like using stickers to differentiate more than a dozen types of ramen. It also helped that JINYA’s roughly 40 stores are spread across regions that reopened early into the pandemic, such as Atlanta, Orlando, and Houston, which represent about 40 percent of the footprint.

In 2021, sales outside the four walls remain elevated, and nearly all of JINYA’s dining rooms are available. That includes the home base of Los Angeles, which recently allowed restaurants to reopen with 25 percent capacity.

“I would think we’re actually holding up very well compared to others in the industry, at least peers that I know,” Bartek says. “ … A lot of people were hit really hard with this. Sales are strong, and we’re in a really good place right now.”

JINYA’s story, like countless others, was about pivoting. That’s what motivated the company to transform its bushi by JINYA store in L.A. into a new pickup and delivery-only concept.

The company completely remodeled the space by removing all tables and chairs and placing a counter in front. The rebranded restaurant leverages upgraded technology to keep labor costs low, such as customers using a QR code to order online. And to meet the demand for contactless transactions, bushi added shelves so guests or delivery drivers can pick up their orders without interaction.

bushi adopted a smaller menu that highlights five types of ramen, like The Bushi Soul Red, which comprises pork broth, pork chashu, green onion, kikurage, bean sprouts, and spicy chili sauce, served with bushi original noodle. The menu also includes a variety of hand rolls, karaage (Japanese fried chicken), rice bowls, and a $20 ramen, hand roll, and karaage combo.

The brand, which began as a full-service concept in 2018, closed in March, but reopened in August.

“We were looking ahead and trying to make something that people would want in this environment, and it’s worked out for us,” Bartek says.

A couple of months later, a second bushi location opened in the Glendora Public Market in Glendora, California—JINYA’s first food hall location. There were some delays with permitting and construction, but since its debut, the unit has performed well. Bartek explains that even though the concept is the same, it’s a totally different environment, so JINYA has been figuring out seating arrangements and how to streamline grab-and-go. The plan is to open another corporate unit in Southern California, which also has been delayed due to COVID.

“That’s still in the works,” Bartek says. “So our hope is to have the three, and they’re all in sort of different environments where the original one is sort of in a strip mall in L.A. The next one, the food hall. And then this one will be sort of an outdoor mall kind of vibe. So kind of touching on all three and just taking the learnings. That’s really what it’s about is just learning. Which style can do best? Where do they go? Continually refine the menu, the processes, all that. There’s been a lot of learning, but it’s been good for us.”

JINYA HOLDINGS

A second bushi by JINYA location opened in Glendora, California, inside a food hall.

In total, JINYA opened six stores during 2020. JINYA Ramen Bar rolled out four of those in Denver; Athens, Georgia; Henderson, Nevada; and Reston, Virginia. The new bushi model accounted for the other two openings. Going forward, JINYA has franchising plans for both concepts.

Mike LaRue, vice president of franchise sales, says interest in bushi has been organic; there hasn’t been much marketing behind the new brand, but existing operators have taken notice. For bushi specifically, JINYA is looking at nontraditional locations that are ideally between 400 and 1,000 square feet.

“We’ve gotten a lot of interest from pretty high-traffic airports,” LaRue says. “We’re in the fortunate position from a JINYA Ramen Bar perspective, you’re planted all over the country. So it wouldn’t be too difficult to develop in other markets outside of Southern California. So we don’t necessarily have anything specific. However, if you look at the major metro markets, that’s generally an easy target.”

“People know JINYA, so when they see bushi, they somewhat understand,” he continues. “And so I think once we actually start marketing the brand, I think we’ll expect to see a significant amount of traction. But right now, we’re very fortunate that all of the interest that we’ve seen, it’s been organic.”

In 2020, JINYA inked deals with five new franchisees to add 14 restaurants to its pipeline. This year, the company expects to open 15 domestic and international restaurants in Arizona, California, Georgia, North Carolina, South Carolina, Virginia, and Vancouver, Canada. LaRue notes that unlike other casual-dining brands that have been trying to survive, JINYA has been forwarding-thinking and has tried to map out the next five to 10 years. Operators in certain markets are starting to expand their current area development schedules.

JINYA recently onboarded a new real estate partner that’s putting the company on the radar of some of the biggest developers in the country. LaRue says that across the board—from both an investor and landlord perspective—JINYA is gaining significant interest because of its unique menu offering and diverse concepts.

It’s very [advantageous], obviously right now, especially with times changing, not just from a real estate perspective, but obviously from an off-premise dining perspective,” says LaRue, in reference to JINYA’s multiple brands. “We’re seeking multi-unit developers. And when they own a market and they have the ability to adapt to how to come into the trade area based off of what’s available, having that flexibility puts us and the franchisees in a very good position.”

Before he joined JINYA in January, one of the things that excited LaRue the most was the fact that the brand earned a high amount of revenue per square foot pre-pandemic. And that was without the added boost of online ordering. In other words, the potential is clear cut.

Bartek is just as bullish. As long as JINYA executes, he believes the brand can “knock it out of the park” with in-store dining, third-party delivery, and the new bushi concept.

“Whatever it is, I think we have a spot,” Bartek says. “So we’re pursuing all angles, trying to learn as much as we can about all these things, and be there because I think this is the kind of brand that can really succeed in all those arenas. And with the different concepts, as well, there’s something for everyone.”

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