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Hong Kong food tech startup challenges Japanese bento market

Written by Nikkei Asia Published on   5 mins read

Former Sony chip designer tries to make changes in lunch via tech.

Kamakura Foods, a Hong Kong startup founded by a Japan-educated former Sony chip engineer, is challenging the bento market in Japan, where the boxed lunches originated. The company plans its entrance not through providing the food itself, but by introducing a tech-based platform for serving bentos automatically.

Bentos fill the bellies of many people every day across Japan, including businesspeople during busy lunch hours. Some are made at home, but many thousands are sold at convenience stores and specialized bento shops, and even by restaurants to meet peak lunch hour demand.

The company, which uses the brand name of Wada Bento, has sold over 600,000 hot bentos in Hong Kong since its inception in 2019. It has 40 machines in 30 locations in office buildings, university campuses and construction sites. In the city, it operates its own kitchen to prepare up to 1,200 Japanese-style bentos a day, selling Hong Kong cuisine provided by its food partners to cater to local tastes as well.

Its maiden bento vending machine in Japan is scheduled to start serving on Friday in Kitahama, a central business district in Osaka. The machine will be placed in an outlet of Obento Monogatari to sell the small local chain’s ready-made box lunches.

“Japanese people are experts in making bentos,” Jason Chen, the founder and CEO of Kamakura Foods, told Nikkei Asia in a recent interview. “So our direction is not to invest in kitchens.”

What Chen sees is a great opportunity in providing a logistics solution to serve hot bentos, including the supply chain between kitchens and its proprietary bento-serving vending machines. “From a business point of view, Japan is a huge market” where speed and a labor shortage are becoming crucial factors, he said.

Chen, who obtained his master’s degree in electrical and electronic engineering from Japan’s top-drawer Tokyo University and worked as an engineer designing drivers for display devices at Sony in Japan and later at Solomon Systech in Hong Kong, found an opportunity in serving hot bentos after seeing and experiencing difficulties in buying lunch during peak hours in central office areas, especially in big cities.

According to an annual survey by the Japan Ready-made Meal Association, sales of “steamed rice, etc.,” which largely consists of bentos and onigiri rice balls, totaled JPY 4.77 trillion (USD 31.6 billion) in 2022, growing by 7.4% from the year before and surpassing the pre-COVID year of 2019.

The Osaka bento shop where the first vending machine will be placed neighbors a 7-Eleven and a Lawson, run by two of the country’s largest convenience store chains. In Japan, convenience stores provide a wide range of selections of bentos and let customers heat them up in microwave ovens.

Even though local bento shops may be able to serve food with competitive quality and price, they face severe competition especially during weekday lunch hours, as people are not willing to wait in line.

“Usually, if there are more than three people lined up, customers tend to go to either of the convenience stores,” said Seishiro Tsukuda, project manager at the midsize Osaka-based trading house Harada Corporation, Kamakura Foods’ Japanese partner.

The latest model of Chen’s vending machine is able to serve a bento in 17 seconds after a customer places an order, and has been redesigned to make it accessible by people using wheelchairs as well. The machine holds multiple kinds of bentos, letting customers make various choices.

Tsukuda told Nikkei Asia that Obento Monogatari hopes the fast-serving vending machine will stop customers from defecting to convenience stores.

Japanese retailers, especially the smaller ones, face serious employee shortages. The new machine is expected to potentially allow them to expand their sales opportunities after 6 p.m. for a new market — dinner — without hiring new staff. “We could help increase their revenue,” said Chen.

The machines are rented out under a subscription model in which certain fees are charged according to the sales amount.

The core part of Chen’s tech solution is in temperature control. The food is kept consistently over 65 degrees C throughout the supply chain in order to serve customers hot meals and prevent the growth of bacteria that could cause food poisoning.

This “hot-chain” logistics is monitored and controlled by GPS and cloud-based internet-of-things technology. After bentos are made, they are placed in proprietary warm containers, usually able to carry 48 boxed lunches, where a heater is set at or slightly over 70 degrees.

The system enables the remote checking and adjusting of temperature and humidity within the container if needed. No special features are required for the vehicles that deliver the containers to the vending machines. The company has gained eight patents so far out of nine filed in Japan, the US and China.

Securing food safety is a critical matter, especially following a major food poisoning case in the northern Japanese city of Hachinohe in September, triggered by poor temperature control by a local bento maker.

The local health authorities said at least 554 people were confirmed to have been affected by bentos served by the vendor, Yoshidaya.

Hiroki Yoshida, president of the bento maker Yoshidaya, told reporters on Oct. 21 that the main cause of widespread food poisoning was “inappropriate temperature control.”   © Kyodo

Hiroki Yoshida, president of Yoshidaya, admitted to reporters on Oct. 21 that the main cause of the food poisoning was “inappropriate temperature control.” He acknowledged that there had been a “lack of thorough understanding of the risk of germs multiplying over time” and said the 130 year-old company, which he inherited from his father, had succumbed to “conceit and carelessness” as it placed too much emphasis on profits.

This could be a worthy lesson for Chen, who is about to set foot in the Japanese market, as Yoshidaya was slapped with an indefinite ban on doing business, lifted only on Nov. 4 after over 40 days, leaving a severe stain on its long-earned reputation.

Chen is seeking a fourth round of funding next year to undergird his expansion plans in Japan in the years to come, and Harada’s Tsukuda told Nikkei that Harada is in talks with other Japanese partners.

So far, Kamakura Foods has raised “several million US dollars,” according to Chen, including from three venture capital funds, the City University of Hong Kong and Cyberport, the city’s tech incubation center, where the bento machine is in operation.

Golden Resources, Hong Kong’s major rice trader and one of the investors, said its intention is to “support startup businesses in food chain extension, food tech and AI applications,” which would add to demand for rice imports to the city. The company, which also runs Circle K convenience stores in Vietnam, has been working together with Kamakura Foods to bring its vending machine system into the Southeast Asian country.

The next logical step for Kamakura Foods might seem to be mainland China, where wages are rising and automation in the food industry is growing. But that is not on Chen’s mind, as he believes it is a “very different” market. Given limited resources, he wishes to prioritize Japan over China.

This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.


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