Expansion and Performance of Kura Sushi USA:
- Kura Sushi has successfully expanded from Japan to the U.S., growing to 60 locations across 17 states. The company reported strong quarterly earnings, marking consecutive quarters of upwardly revised financial guidance. This success is partly due to strategic location choices based on sophisticated analytics and demographic insights.
Innovative Dining Experience:
- Kura Sushi offers a unique "eatertainment" experience with its revolving sushi model, where customers can pick plates from a conveyor belt. The dining experience is gamified with rewards and animated stories triggered by the number of plates a customer consumes, enhancing customer engagement and satisfaction.
Strategic Collaborations and Technological Integration:
- The company leverages popular culture by collaborating with well-known anime series like "Spy Family" and "Dragon Ball," which boosts its appeal and sales. Technologically, Kura Sushi is advancing with features like robotic servers and a sophisticated loyalty program facilitated by a new app that improves customer data collection and targeted marketing.
Market Positioning and Adaptation:
- Amidst labor market changes and rising minimum wages in fast food, Kura Sushi maintains a competitive edge by offering high-quality sushi at reasonable prices, positioning itself between fast food and high-end dining. This strategy helps attract customers who are looking for better dining experiences without significantly higher costs.
Katie Perry (00:00):
I'm Katie Perry, and this is After Earnings, the show for Morning Brew and Stakeholder Labs that brings investors up close and personal with the executives behind the world's most interesting companies. Austin is out this week, but we've got a great show lined up today. We caught up with Jeff Utz, the CFO for Kura Sushi USA, which is a tech enabled Japanese restaurant concept that is rapidly expanding in the US after building its brand in Japan for the past 20 years. Kura Sushi is a mid-market restaurant experience and it allows sushi lovers to grab plates from a conveyor belt that circles the restaurant. And if you've ever been to one of these, you know how fun it can be. Lots of ground covered here with Jeff after Kura reported its Q1 earnings and adjusted its guidance up for the second straight quarter in a row. We talked about how sophisticated analytics helps inform where the next Kura restaurants will pop up, why labor trends are pushing traffic to places like Kura over fast food chains and the company's plans to continue to expand its footprint here in the us. Wow. Jeff, welcome to After earnings. So excited to have you here. You guys announced recently, had a big quarter, would love to hear all about it. But before we get into that, what is Kura Sushi USA? How should people think about this idea of a tech enabled Japanese concept restaurant? Give us a breakdown of who you guys are and what you offer to consumers here in the us.
Jeff Utz (01:22):
Sure. Well, I appreciate you guys having me on. I'm excited to be able to share the story and talk about our most recent quarter and tell everybody what Kura Sushi is all about. So Kura Sushi started actually about 40 years ago in Japan. Our parent company, Kura Sushi Inc, has about 500, 550 restaurants in Japan. And in 2009 they decided that they wanted to come to the state. So we came into the US and opened our first revolving sushi concept in Irvine, California in 2009. And I was started in the US by our CEO Jimmy Uba, who has been with URA Sushi for his entire career and started at a young age right out of school and has done a great job at building the brand in the us. And for those who aren't familiar with revolving sushi is we have a conveyor belt system that goes through the restaurant.
(02:17)
It goes by each table and we have our sushi going around on plates that are covered with a patented dome called Mr. Fresh. We will keep it sanitary as it goes around and the guests have the option of grabbing a plate as it goes by them, whatever they want and enjoying it. All the plates are priced exactly the same. The average is about $3 and 55 cents depending on geography and you enjoy your sushi. And then when you're done, you drop the plates in a slot next at the end of the table, at the end of the booth, and as you accumulate plates, you earn prizes. So after the first five plates, the screen, there's a video screen with a touch panel at the table, we'll play a video of a little story, an adventure, and after you do five more plates and get to 10, it'll continue the story and the adventure.
(03:10)
And then when you get to 15 plates, you get a price, we call it a piura upon price, and it will come out of a dispensary at the top, next to the booth up at the top and there will be a prize inside. And generally that prize is related to whatever collaboration we're doing with an ip, intellectual property at the time. The one we're currently working with is called Spy Family, which is an anime series in Japan. And then we're really excited. The last earnings call, we announced that the next collaboration starting in May will be with Dragon Ball. And Dragon Ball is one of the most, if not the most popular anime franchisees in Japan. And it's one of the first ones that we believe that the American consumer is going to be really familiar with. So these collaborations that we do really help generate sales, they get our guests excited. So we're really excited about this one because we believe that Dragon Ball could be one of the biggest ones we've ever done.
Katie Perry (04:11):
And no surprise gamified eating is a hit in the us but I do want to call it they're smaller portions. Right. I think I read that the average customer is pulling 6, 7, 8 plates. Is that accurate? The sizes are sides essentially and you're stacking those up?
Jeff Utz (04:30):
Yeah, so the plates, like I said, the average is about 3 55 and if you order ngi, you'll get generally two pieces. Some things that are usually limited time offers like a Toro, something that's more expensive item, you might just get one, but generally you get two pieces of ngi or if you order a roll, you will get generally four pieces. And what's really nice about that is if you go to a typical sushi restaurant and you're with somebody else or you're with a group of people and maybe you're the only one that likes a certain kind of role, a Philadelphia role or whatever it is, you name it and you order it, it might come with eight or 10 pieces and if nobody else likes it, you're stuck with a giant roll yourself. This allows you to get more of a personal size. You can share if you want, but you don't have to. So it's a really unique concept, whereas everybody can sort of order their own personal things if they wish without having to order a giant roll and be able to try more things that way. And you're right, it's about six plates per person, little over six plates per person on average when people come in and visit us.
Katie Perry (05:32):
Super interesting. And unlike a lot of when we think of restaurants here in the US in so many ways, I love how you guys use the word eat entertainment, is that accurate? But it is, it's a gamified experience. It's fun to do with friends. And the prize integrations also make those partnerships really interesting to a different degree than your run of the mill fast food chain partnership that comes and goes and is not as much tied to the actual restaurant experience. I would love to jump into just the growth of sushi popularity in the us. Obviously you guys saw something happening over here back in 2009, I believe that it's over a 30 billion industry in the states. And I'm curious, what do you attribute that to? Is it the internet, people in different markets being exposed to sushi that weren't before? Is it these reality TV stars going to get sushi? What kind of growth trends are you seeing in terms of popularity? Because it does seem like it has gone completely mainstream.
Jeff Utz (06:35):
It has. When I was a kid and most people who are my age or close to it can probably remember that when you went out for sushi, especially in the us, it was a treat and probably something you did maybe once a year or twice a year. And it was something that was very different and a very unique experience is something you really look forward to. And as sushi has evolved in the United States, and there's so many mom and pop sushi restaurants that are throughout the country. And if at any time if you're anywhere, any city and you pull out your phone and you say sushi restaurants near me, you're going to get quite a few. Almost every single one of those is mom and pop. Sushi is a 26 billion industry and only the two players, the top two players, which are Nobu and Cur Sushi have the top portion of that and about 2% of that.
(07:29)
So what we've done is bring sushi to the mainstream. And then when you talk about, I wanted to go back on something you mentioned a little bit earlier, the entertainment concept. And what we've done is we've taken technology and made it fun, made it fun in the restaurant. So just to give one example, something we debuted about a year and a half ago are robot servers. So if you order a drink off the touch panel that's at your table, that's a non-alcoholic drink where we don't need to check your id a tea or a soft drink, it'll be delivered by our robot, which is called Kirby. And the robot will deliver the food and it's plays music and it, you take your drink off and it says thank you and it goes back to its station. So that's kind of a unique concept and there are some people that hear about that and say, I want to go see that.
(08:16)
I want to go see this restaurant with the robots. I want to go see the restaurant that has the prizes that you get after you drop a certain number of plates into the plate slots. But then after they come in, they realize that the food is really good and the quality is really good and the service is really good. And they say, what brought me in was this cool technology that this company has and what's going to bring me back time and time again is the quality of the food and the quality of the service. And I think that's what we bring to the sushi market.
Katie Perry (08:44):
And that goes into, I wanted to ask about this DoorDash partnership because when I was reading about it, I was like, huh, it seems like the experience is in the restaurant, but as you say, people might come for that experience but then realize the foods they love the food. So can you talk a little bit about the DoorDash partnership and strategy and what you're seeing in terms of customers wanting that food at home without perhaps that entertainment experience around it?
Jeff Utz (09:16):
Yeah, we launched the DoorDash partnership in March and it was just fully rolled out to all the restaurants in March. So we have very early results, which we haven't discussed have the amount of sales that we're getting from the DoorDash partnership and really what it's going to do, it's really too early to tell we're going to have to just gather data over the next several months and we'll have information to share in future earnings calls. What we found though is that off-premise, the sales for us has generally been in the low single digits during Covid. It spiked up into the 20% range as a lot of restaurants did when people were ordering in when they couldn't go out. But what we know is that, like I said, people love our food and they love the service, and if they can't have the service and they want to have it at home, they still want to have our food.
(10:02)
We're very happy with the early results of what's happening with the DoorDash and how many with the DoorDash partnership and how many orders we're getting and we're excited. That is the algorithm that DoorDash uses. As you continue to have guest order from you, you move up in the ranking. So if you press the sushi category when you're brand new, then the new players are all going to be down at the bottom. They don't have any rankings, they don't have any feedback, they don't have any guest comments. But as people continue to order and people post their ratings and make comments, then you move up in that algorithm. So we're really excited over the next, call it six months to a year as we move up in that algorithm, what it's going to do for our sales.
Katie Perry (10:44):
And how many locations do you currently have across the US and how many were opened in the last year?
Jeff Utz (10:51):
So we have 60 restaurants in the US in 17 states and District of Columbia, and we've opened 10 so far this year. We opened 10 in the first half of our year. So one thing that's important to note is we talk about our year is that our fiscal year ends on August 31st. So the quarter that we just released, which was the quarter ended February 29th, that was quarter two for us. So that's halfway through the year. And as of that point, we had opened 10 restaurants in the fiscal year, so we were at 60. And our guidance to the street this year is that we expect the total number of restaurants to open in fiscal 24 is going to be between 13 and 14 restaurants. So we expect to end the year in August at 63 to 64 restaurants.
Katie Perry (11:34):
Wow, that's a lot of expansion. And I saw some of the openings and I was looking at the map. I saw locations obviously in places like California, Texas, but also Illinois, Michigan, some of these markets that might not have a lot of great sushi options. And I'm curious, what do you guys look at when you are serving which potential markets to go into next? Is it migration trends, population, demo data, perhaps the void of other sushi offerings there? How do you determine which market or city is next?
Jeff Utz (12:14):
We use a lot of different tools to determine where we're going to go. The single biggest contributor, the single biggest factor that we look at that seems to have the biggest impact on where we put a restaurant is the percentage of individuals nearby with bachelor's degrees. And that seems to be the biggest driver of how well a restaurant is expected to perform, but that's just one of the pieces that we look at. We use a data analytics tool called eSight that we will put in the address of where we want to go. And eSight is a self-learning tool that knows where all of our restaurants are, and it knows based on the demographics of where those restaurants are, who our co-tenants are, what other major retailers are nearby. For instance, it might know that okay, every kura that's within two miles of this retailer on average does 2.2% better in sales than ones that don't have this retailer within two miles.
(13:14)
And it has hundreds of things like that that it learns over time. As we open restaurants and that data gets loaded in, we look at that, that's a tool. We go and visit the site, we see how the traffic is, we talk to people in the area, we talk to other restaurant operators that are in the area. We gather sales data from other restaurants that are in the area, and all of these pieces come together to our real estate committee. The real estate committee is in presented with a packet that has just voluminous amounts of information in it, from overhead maps to demographics projections, our co-tenant. And when we get that package as the CFO, one of the things that I'm most interested in is what is our cash on cash return going to be on that restaurant? And our hurdle rate that we go for, which we've beaten substantially in many restaurants recently, is about a 33% cash on cash return. So for me, I want to see that restaurant generate enough cash to pay back its construction costs, which is average about two and a half million dollars. We want to see that paid back in three years on average. But like I said, we've been really successful in having several restaurants that have beaten that hurdle rate very significantly over the past two to three years.
Katie Perry (14:33):
And are there benchmarks for hurdle rate within your space that people could kind of contextualize the 33% against?
Jeff Utz (14:43):
I've been in restaurant finance for over 25 years, and my experience has been that most companies look at between and four years. And as you continue to infill markets and your white space starts to fill up, you may want to shift that from a three year to a four year return on capital because the low hanging fruit has already been taking. But with Cura, we believe the white space study that we have published in our S one when we went public in 2019 indicated that we could have about 300 restaurants in the us. We believe that number to be much larger. We haven't quantified what that number is. And quite honestly, the majority of shareholders that I talked to believe that number is much higher as well, which is why we have so much interest in the company when we go to investor conferences and meet with the banks. That being said, if you want to get to the top end of your white space study, probably going to a four year payback would be reasonable or maybe somewhere between a three and a four year. But we're nowhere near that. We're in a huge growth stage and we have so much white space in front of us to continue to grow this company. I would still like to see a 33% return.
Katie Perry (15:51):
Super interesting to hear how data is used there in advertising. Things exist like lookalike audiences where you can take the profile of a consumer and then go and find those others. And it's really fascinating to hear that that also exists in commercial real estate and in your industry where you can essentially use data analytics to feel very confident about where you're going next. And I want to touch on something you pointed to earlier, which I thought was interesting. In the sushi restaurants with the most market share, you guys and Nobu obviously very different experiences with those two. Kura isn't fast food, it's not Nobu. How would you describe where that fits in the market? Because I think it's interesting where it's not QSR, but it seems pretty affordable and it's great food for a good price, but it's not necessarily going to break the bank either.
Jeff Utz (16:48):
Yeah, I mean we're in a very unique place because like you said, we're not fast food, but we're not quite full service casual dining because as I mentioned at the beginning when we were speaking, you sit down at the table and you can take your plates off of the conveyor belt as you go. So what we really look at as we think it's a huge opportunity for us when it comes to the value proposition because our per plate, our average check per person is about 26, 20 $7. And because of that, when you look at some of the pricing now going on with the QSRs, especially in California where they recently introduced what's called the FAST Act and then it was called AB 1228, which said that on April 1st all fast food restaurants that had more than 60 locations in the country had to raise their minimum wage to $20 an hour in California.
(17:41)
And most fast food chains in California have raised their prices because of that to the tune of nine, 10, 11% even into the low double digits on the amount of menu price increase that they took. Well, we didn't have to take any menu price increase, and we're also not worried about our employees leaving us to go to work for A QSR at $20 an hour because most of our employees in California in particular receive tips including the back of the house. So everybody with their tips generally makes over 20 bucks an hour. So we weren't super concerned about people leaving us and going otherwise. So what we believe has happened because of the unique position that we are is that the value proposition for Kura has grown because now I know that a lot of places you can go into, let's call it a premium casual type fast food place, it might be 17 or $18 if you order a burger or a double burger fries and a drink or fries and a shake. Whereas you can come into kura and have a great sushi lunch or dinner for $26. So for just $6 more, six or $7 more, you can come into kura. We believe people are going to do that. So we're really excited about the potential increase in the value proposition provided to Kura by some of the laws that are going in place. But we're only able to see that because of the unique position where we sit between full service dining and QSRs
Katie Perry (19:01):
Makes a lot of sense. I order $24 salads on a regular basis that are constantly getting smaller. So it is very interesting that the labor trends are shedding light on the value that you all offer. And just like Warren Buffet always says, if you think the product's great and it's at a great price, that's a buy. So that's really interesting to hear about. And if I understood correctly, you all are not under the umbrella of those labor trends. You're not categorized this QSR.
Jeff Utz (19:38):
Yeah, the definition really is if you pay for your food before you receive it. That's sort of the general definition of restaurants that fall under that. So it would be your typical fast food restaurants. And then to expand on what you just said too, it's crazy. And Orange County, California, which is where we're based, I ordered a salad from, I won't name the concept, but a premium, the salad chain. And I ordered on a DoorDash, but after the salad, the service fee and the delivery fee I didn't have because I have pass, but the tip, it was $27 for just a salad. And so when you think about that, and granted I had the tip and the DoorDash and stuff like that, but regardless, that gap is closing between some of these places and places like ura and we're really excited to see what's going to happen. It's only been 15 days, so we don't have any data on it yet, but it's encouraging.
Katie Perry (20:33):
Yeah, that's definitely a big trend that I think a lot of us are probably aware of tangentially and haven't really thought about it, but it's so true when the Delta is not that great between those two experiences, you could see people kind of shifting to go up market a little bit. I want to shift to supply chain. You've worked at a lot of restaurants and the financial side of things, Carl Hardee's, Kara seems a little bit different in that it's very fresh products that you guys are moving. And so I'm so curious about how that all works. I know you use technology, I think RFID tags on some of the inventory, but can you just speak to how that's different supply chain wise with Kura now versus maybe some of the typical QSR chains where the food keeps longer?
Jeff Utz (21:24):
Yeah, so we source just to talk about our sourcing. We source from all over the world. So to give some examples, our blue tuna comes from Croatia, our shrimp comes from Indonesia, Vietnam, the salmon comes from Chile. And then we have a lot of products that come from Japan. So our products are coming from all over the world. And something that you might be surprised to hear most people are is that in almost every jurisdiction, sushi in order to be shipped, is required to be frozen. So even when you go to the most expensive $200 Oma cae, that fish is likely, but the technique that is used is something called super freezing, and it's similar to the technology that they use in blood banks and it's frozen on the boat when it's caught or on the ship when it's caught immediately. And this freezing technique doesn't break down the cell walls.
(22:21)
So when the fish is thawed, the cell walls are still intact and you don't have the mus that you've probably seen. If you freeze something at home right in your freezer and you take it out, especially if we're a fish or something, it might be mushy. We don't get that with the sushi because of the special freezing technique. So it's all shipped that way. And because of the geographical dispersion that we have when it comes from all over the world, we don't have a lot of risk associated with running out of a product or things like that. We also use two Japanese broadliners in the United States that can step in for one another. So if one of them were to run out of a particular product, the other one should be able to step in and fill their shoes. So we're very tight when it comes to the way the supply chain works. And like you said, perhaps some of the stuff may not last as long as it's fast food, but because it comes in frozen and stays frozen until it's served and thawed properly, it's just coming right off the boat and it's super fresh once it's ready to go.
Katie Perry (23:21):
Interesting. I never realized that. It makes a lot of sense.
Jeff Utz (23:26):
Even really, like I said, even the expensive, expensive Oma, like I mentioned that you may go to New York very, they use a similar concept just because most healthwise require that
Katie Perry (23:36):
Right all in the process. I do want to ask also, obviously Kura is huge in Japan, has been for many, many years, big footprint, known brand. I'm curious how you all think about Americanizing the experience, and I think I assume part of the allure is the authenticity of the product and the experience, but are there certain tweaks that were made for the US crowd that differentiate from the Japanese experience or are they fairly consistent?
Jeff Utz (24:08):
The model itself is very similar. The menu is different. One of the biggest things, and again, this may be something people who haven't been to Japan don't realize, but roles are not a Japanese thing. Rolls are an American Japanese food thing. So you won't find rolls if you go to cur sushi in Japan. That's probably the biggest difference on the menu. But the entire business model in the US is completely different than in Japan. The plate price in Japan at Kura is much less. Their labor model is different. Their occupancy and their rent model is different. So it's a much different experience. But I think one of the reasons why Kura has been successful is that the company, and Jimmy in particular, our CEO has done a very good job at identifying the differences between the Japanese consumer and the American consumer. And there's been many other revolving sushi concepts that have tried to come into the US and haven't done well and failed and left the country because they didn't do their homework as well as Kura has and determined exactly what that American consumer is looking for and just implemented all of the things that do well in Japan.
(25:28)
And while some of those things may translate well to the us, not necessarily all of them, and you have to be exactly certain what's going to work and what's going to need to be tweaked. And Kura has done an outstanding job of doing that over the last decade.
Katie Perry (25:43):
And I also want to ask, jumping around a bit, but the loyalty program, I read some stats that jumped out at me about the stickiness of this group of customers for you and kind of the revenue impact they're driving. Can you voice over the contribution that your loyalty reward program members yield in terms of driving sales for you guys?
Jeff Utz (26:07):
Yeah, the loyalty members we know come to Curra Sushi much more often than people who are not part of the loyalty program. We believe that the loyalty members come a little over one time a month to the restaurant, whereas our assumption on the people who are not loyalty members is probably twice a year in terms of visits. So it's significantly greater how often the number of times people come who are part of the loyalty and the rewards program. We just recently launched a new app and a new loyalty and rewards program as part of that app. That's really exciting. And our old app that we were using was developed. It was a little clunky, didn't work how we wanted it to, but most importantly what it didn't do was gather data. And one of the most important things that a restaurant company can do with a loyalty system is gathering guest data and determining what our guests want, what they're eating when they're showing up at the restaurant and all their habits and their patterns is very, very useful. So our new loyalty platform that was launched along with the new app allows us to do that and then we can do targeted marketing and different things like that. That'll be really exciting in the future. And like I said, it's new and we haven't released a whole lot of data on it. We've only launched the app I think about four or five months ago, but it's been really good so far.
Katie Perry (27:30):
Yeah, we had a marketing technology, CEO come on recently, and he was talking about sort of this idea of converting one-time customers to super fans. And sometimes brands can lose sight of that because they're thinking, I got to go acquire more people, new people. But sometimes doubling down on the ones you already have in there through things like loyalty programs, I think is a good strategy to that extent. What interesting feedback have you heard from loyalty members or customers? What are you kind of hearing from your customers on the ground that is resonating in the walls of Kura Sushi USA?
Jeff Utz (28:09):
Well, one of the things that our guests love the most, and this isn't new with the new app, we were doing this with the old app as well, but at Kura for if you're a loyalty rewards member for every $50 that you spend, you get a $5 coupon to use on your next visit. And it's an instant 10% discount if you spend $50. And people really, really like that. And the feedback that we've received from people is that we really like it. The other thing that we did as part of that app, and this isn't necessarily tied to the loyalty program, is we have enhanced our wait time feature in the app. So when you're coming to kura, a lot of times our restaurants are so busy, they will have a two or three hour wait. You can join the wait list from home on the app and then move up on the wait list over time and you can drive in as you're getting close and have your table. And that's something that people really like too because the previous app didn't calculate the wait times quite as accurately as the new app is doing. And the feedback that we received is people really enjoyed that. They enjoyed the discounting, they like our marketing team does a lot of pushes out to people for different marketing promotions and tell people come in for this or that. And the guest feedback has been good, really, really good.
Katie Perry (29:24):
The mobile wait list is such a game changer. If I think about even a mild my childhood, you had that chunky thing that would start shaking. And there's a famous family story in my family where my dad got so fed up at an Outback Steakhouse once he put it under the car and backed up over it and we never went there again. But I love that because reflecting the real time nature of how people are experiencing things now, and I think it seems like it's a part of kind of how you're positioning yourselves as tech enabled in order to make that in real life experience better for customers.
Jeff Utz (29:57):
Absolutely. What's funny about those old clunky pagers, those buzzers, we used to always tell people they don't work outside the restaurant, but they do. But way you tell 'em that so they hang out at the bar and pump your sales up. Oh my God. So at least the ones that I've seen worked, it's not like they worked for Miles, but you could probably go walking around a little bit. You didn't have to stay in the restaurant. But yeah, it's great. There's a
Katie Perry (30:21):
Great way sales. That makes a lot of sense. That's such a fun fact. I want to now turn to the idea of the restaurant business, which I think is so interesting and unique and I really got into it. I have a friend who's a photographer in the space, but also I love that show The Bear and what I love about the restaurant industry is that you really have people from all walks of life working together as a team. And so it seems like as you guys are opening these new restaurants, there's local municipalities, there's contractors, you have your servers on the ground. Can you talk about what that's like as an executive in this space? Because I think a lot of industries you don't really have that crossover as much, and I think it's something that's unique and sort of beautiful about the restaurant industry.
Jeff Utz (31:08):
Yeah, I mean one of the things that anybody who follows the restaurant industry has been hearing over the last four or five years, especially during Covid and you mentioned working with contractors and working with municipalities, is that it's become very difficult in terms of permitting, in terms of getting in the queue for like if you're ready for your electrical inspection, let's say. It used to be you could just call the township or the city or the municipality and say, Hey, I want to get on your calendar. When can you be out? And now, especially since Covid, a lot of cities have gone back to nobody in the office in this particular department and you just have to go on their website and go into a portal and put your request in, but you never hear. You don't know is it going to be two weeks?
(31:56)
And it is been very difficult, that process. But really when we go into a new city, a new town, we want to be partners with that town or that city. We want to be part of that community and we don't want to just be the big sushi player coming in and trying to take over business. We want to partner with the community. One really cool thing we do is we do this Japanese art that we are trying to put in all of our restaurants. That is the art is somehow about the community if there's a particular industry that the communities and the artwork will be about that industry, but it's very cool. We want to tie into the neighborhood the community and be part it. And from day one we try and partner with the leadership in that town to show them that.
Katie Perry (32:45):
That's great. And where can folks listening at home see if where the nearest URA sushi is to them? Do you have a lookup tool on your website where can people check that out?
Jeff Utz (32:56):
Yep. Go to ura sushi.com and there'll be the locations tab and you'll be able to see all of our locations by state. As I said, we're in 17 states and Washington DC so I'm hoping that anybody that's listening to this podcast, I hope we have one near you because we'd love to have you
Katie Perry (33:10):
Coming into the town near you. You heard it here first. Jeff, thank you so much for coming on today. I loved learning all of the interesting information about your company and also the fun fact about those old beepers they used to give you. So really appreciate the insights.
Jeff Utz (33:26):
Yeah, I appreciate you having me. Thank you so much.
Katie Perry (33:28):
Thanks. I really love this interview because it is truly a gamified restaurant experience. A lot of times in the era of Uber Eats and Seamless and GrubHub, food is very transactional. We want it to come to us as quickly as possible. We eat it, it's done. What Kur Sushi is actually building is a reason to leave your house, a reason to go to their restaurant in a gamified way of being and actually entertained while you eat, which in the US is sort of a novel concept. And the gamified experience is really interesting to me for a couple reasons. One, just in terms of how this business runs compared to other QSRs, he mentioned that the average customer is ordering 6.3 plates once they're in the restaurant, and they also have a robust loyalty and rewards program. Again, there's perks you can unlock for eating more and for taking more plates.
(34:15)
And so I thought it was interesting to hear from a restaurant business that wasn't just about the single meal, but rather the experience overall. I also loved digging into the labor trends. So Kura Sushi is a mid-market solution. They're not Nobu, but they're not fast food. And one interesting thing we talked about was how new policies that are raising the minimum wage for fast food chains are actually helping push people into places like Coura. If you think about the cost of food at a lot of your favorite QSRs going up, maybe your salads $25 now, a lot of people will justify going somewhere for a little bit more. That Delta is smaller between the QSR and actually the restaurant experience. And so that was an interesting knock on impact of the labor trends that I hadn't really thought about before. I also loved hearing about the tech innovations.
(35:02)
They're transporting fresh sushi into the US into Illinois, Texas, Michigan, a lot of these places which aren't on the coast, and they're doing it with a lot of interesting technologies, one being RFID, using that to track their inventory. They also have a sophisticated digital wait list experience as well as a sushi delivering robot named Kirby. Sounds horrifying but cool at the same time. But again, something that might be worth leaving your house to see. So with that, I'm Katie Perry. This was After Earnings brought to you by Morning Brew and Stakeholder Labs. Remember to like, subscribe, retweet, do all the things, and also give us your suggestions for who you want to see on the show. We're here listening and we'll see you back again next time.
