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2 Key Insights from Sakae Holdings Ltd’s Chairman

Sakae Holdings Ltd  (SGX:5DO) may be best known for its namesake conveyor-belt sushi chains.

Recently, Douglas Foo, Sakae Holdings’ chairman, was featured in an interview series by bourse operator Singapore Exchange Limited  (SGX: S68).

I had picked out two key insights from the interview that may be useful for investors.

Danger and opportunity

“Sakae, which owns more than 200 restaurants in Singapore and nine other countries, opened its first outlet in Singapore’s central business district in September 1997, right smack in the middle of the Asian financial crisis.

“It was totally nerve-wracking. We were thinking whether we should hold back because of the downturn. But really, when is it ever a good time?” recalled Foo, who was 26 then.”

It is said that necessity is the mother of all invention. As my colleague Morgan Housel muses, everything that’s good today was born from something that wasn’t good in the past. The same could be said about the founding of Sakae Sushi. The company rose from the dark clouds of the Asian Financial Crisis and now owns over 200 restaurants worldwide.

Foo’s comment may have some parallels in investing as well. In investing, there may be always something to worry about. But, those worries shouldn’t be deterring us from investing most of the time.

What does your brand stand for?

““Some colleagues wanted to cut costs and suggested we stop adding Vitamin E to our rice. But I told them, ‘Let’s not lose our direction, because if we do, we can forget about building the brand’,” Foo said.

“I asked them, ‘If you were cooking this pot of rice for your family, would you add the Vitamin E?’ The answer was clear, so we kept the recipe, and senior management volunteered to take a pay cut instead.””

Foo also highlighted a key story about how he insisted to keep the recipes for Sakae Holdings intact. In his view, the value of the brand was much more important than cost cutting. This could be a sign of long-term thinking in the business.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn’t own shares in any companies mentioned.