After the unexpected turn of events brought on by the M&A, the question Kikuchi found himself facing wasn't "how do I protect the family business," but "what do I actually want to achieve through management itself."
Why did he launch the pet food business as a separate company? Why did he choose Shopify as the core of his e-commerce, and why crowdfunding as a tool?
Running through all of it wasn't just a story of scale or efficiency, but a perspective on who to build the brand with, and what kind of relationship to build it through.
"Going forward, a brand will be defined by whether it can share its MVV—mission, vision, and values—with its customers."
Where the business stands now, and the vision beyond it. In Part 2 of this interview, we dig into what Ryo Kikuchi, President and CEO of Pekofull Inc., sees as the conditions for a brand people root for, and the thinking behind his management decisions.
(Center of photo: Ryo Kikuchi, President and CEO, Pekofull Inc.)
You can read Part 1 of this interview here.
Not Family Business vs. Startup — Choosing "Management Itself," Again and Again
—— Taking over a family business while also launching a new company still feels like a fairly rare case. Do you personally feel you want to weight your focus more toward the family business or toward the new venture?
Kikuchi I talk with my father and family, and I'm also part of a community for business successors, but what's clearly different about me is that it's not so much that I want to run the family business or that I want to run Pekofull—I think I'm strongly drawn to management itself.
When I was working at the bank, business owners just struck me as incredibly appealing. That's true of both my grandfather and my father—they seem to be enjoying life, full of energy, and they look young. Running a business, building a business itself, is packed with everything I admire and everything I love.
So I want to build work and things out of what I truly love, the kind that becomes the biggest memory of my life.
Right now, food is the deepest core of who I am. So in a field I can devote myself to wholeheartedly, I want to give pet food everything I've got.
At the same time, Kakiya Co., Ltd. is also a valuable business that's continued for 50 years, a company right at the heart of food. I want to throw myself fully into whatever I can do—improving it, turning it around.
Succession Management vs. Startups: What the Different Hurdles Really Are
—— Now that you've actually become a business owner, was there anything that turned out differently from what you imagined?
Kikuchi Honestly, Pekofull turned out to be the easier one. There's a part of it that's been boosted by the know-how and connections I built up through the family business, so I had a sense of "this is more doable than I thought." That part was something I'd more or less calculated in advance.
What turned out differently was the sense of speed. When you say "startup," I had an image of raising funds and gathering a team from the start and scaling all at once. But in reality, growth speed changes drastically depending on how much the founder moves things forward personally.
Given that, I felt it would be better to do things solidly on my own at first, building things up steadily, margins included. Solidifying the foundation properly for the first three years or so, then growing from there, felt like the better fit for me.
Rather than running on the assumption of losses from the start, my sense is that starting as a kind of "SME-flavored startup" ends up working out better.
—— So in a sense, the new venture was easier to keep under control.
Kikuchi That's right. Since my own decisions get reflected directly in the business, the moves I make to improve things happen fast too. In that sense, Pekofull has stayed within what I expected.
(Pekofull's flagship product: domestically made roll food)
The Real Hard Thing About Running an SME Is "People"
Kikuchi Honestly, Kakiya has been nothing but hard. It's far from what I imagined back when I was a bank employee, thinking, "we should be able to fix this in about this much time."
In the end, running an SME comes down to nothing but "people." It all comes down to how much the people you have are willing to do, and how well you can manage that. This has been harder than I ever imagined.
—— Is that mostly about the internal organization?
Kikuchi It's true internally, and it includes our business partners too. Everything is just far too dependent on specific individuals. Almost nothing has been systematized.
If the person we deal with at a supplier changes, the whole situation shifts overnight. Performance suddenly improves, or suddenly worsens—the swings are too big. I have a strong sense that things aren't really running as an organization.
So in the end, it comes down to "then I guess I have to do it all myself." This is quite grueling.
—— That sounds like a fairly deep-rooted issue common to a lot of SME management.
Kikuchi It really is deep-rooted. You hear success stories like "we stopped subcontracting and switched to mail order, and it grew all at once," or "gross margin improved by dozens of percent and it suddenly became a great company," but that kind of miracle move doesn't happen easily.
We kept things going for two years trying to do right by our employees and make the workplace comfortable, and the result was that performance worsened and the people we trusted quit all at once. Something like that actually happened quite recently.
—— That's a pretty raw story. Meanwhile, running Pekofull is a completely different world.
Kikuchi It's a completely different world. With Pekofull, an approach of building fans together with people who resonate with what I believe in actually works. But the family business doesn't work that way. Even though they're both "management," the two are completely different in nature.
(Offering roll food samples at an event booth)
How E-Commerce Operations and RuffRuff Use Began From a Choice to Prevent Stockouts
Their own e-commerce site, built around Shopify to keep up with growing customer needs. The trigger for adopting the RuffRuff apps wasn't some advanced marketing tactic—it was the extremely practical challenge of how to prevent "lost opportunity" when a product runs out of stock.
—— Could you tell us what led you to adopt the RuffRuff apps?
Kikuchi At first, I wanted to do pre-orders. To begin with, I was researching how to avoid lost sales opportunities when a product went out of stock, and pre-orders came up as an option. I realized this was an approach that's only possible because it's online retail.
While searching for an app that could handle pre-orders, most of what I found was made overseas, but then I unexpectedly found an app from a Japanese company. And the specs were extremely easy to understand. I decided right then that this was the one.
—— Did you compare it against other apps too?
Kikuchi I tried out a few during their free trial periods, but RuffRuff 予約販売 was easy to understand above all else. Since it's a Japanese company, I could ask right away whenever something wasn't clear, and that made it the fastest by far.
—— You're also using the Order Limits app, right?
Kikuchi There aren't any unnecessary options, so it's easy to use. We use it because we want to limit orders to a quantity that fits in a single box, to keep shipping costs down. There's also fine-grained control, like wanting to limit trial sets to "one per person."
The challenge is that I haven't been able to use it for anything very sophisticated strategically, so conversely, I'd love to know more about how other people use it, and what it takes to build a better e-commerce site.
There's also RuffRuff Author Profiles, which I've been curious about lately. At first I thought, "what's the point of writing an author," but as I've gone along, I've come to understand how important it is, even for SEO, to consistently build up the same author information over time.
—— Exactly. Making the author information explicit makes it clear who is publishing or supervising the information, and from what standpoint. I think that's an important design point for building up content on an ongoing basis, too.
(Selling trial sets using the RuffRuff Order Limits app)
100 Million Yen in Annual Sales: The Growth Milestone Pekofull Has in Sight
—— Do you have goals for the business going forward?
Kikuchi First, 100 million yen in annual sales is the primary target. Once we get to 100 million, I think 1 billion is well within reach from there if we push into overseas markets. So the idea is to go after that first goal solidly.
—— That's a fairly concrete milestone.
Kikuchi 100 million a year works out to about 10 million yen in monthly sales as a benchmark. I want to hit 100 million in annual sales either this fiscal year or the next. We're also preparing for overseas expansion, so once 10 million yen a month comes into view, the plan is to look beyond Japan as well, scaling to 500 million, then 1 billion, over five years.
—— Pekofull is currently running a crowdfunding campaign too. Could you tell us the goal behind launching it?
Kikuchi To aim for 10 million yen in monthly sales, I think we need not just customers who simply buy from us, but ambassador-like figures who support us every single month.
To make that happen, it's not enough to just talk about the product—we also have to properly convey "why we're doing this business" and "where we're headed." When I thought about it that way, crowdfunding felt like the easiest way to convey those feelings.
(Taking on a next goal in the crowdfunding campaign)
Kikuchi Last December, an overseas brand that was well known in the roll food market had its imports halted, and it's now been exactly a year since then. I've heard rumors that it might make a comeback sometime after this spring.
Given that, I decided to go all in with the resolve that Pekofull would take ownership of the roll food category. The crowdfunding campaign is also a declaration of that intent.
Even if it does make a comeback, that's fine too. If it energizes the market, I welcome it. Like Nike and Adidas, if competition makes the whole category stronger, that's a good thing. That's the kind of relationship I'm aiming for.
—— The perspective of "growing the market together" feels like a pretty deliberate choice. Is there some background behind how you came to think that way?
Kikuchi This comes from my time at Shoko Chukin Bank: the numbers are the premise, of course, but in the end, a large part of a loan decision comes down to "do we want to support this company." The outcome shifts depending on how much passion the loan officer can put into pitching it to the credit review department.
In the end, I realized business really does come down to people. The companies I secured funding for with real passion mostly did well afterward. Having money does make things run more smoothly. So I want to become a company that people genuinely like and root for.
The other is from my experience with Kakiya, the family business. Products sold to major supermarkets inevitably live in a world where they're chosen on price and volume, and it's hard for a brand to be rooted for there. I've felt firsthand how difficult it is to build a strength you can point to and say, "this is what we're about."
That's exactly why, with Pekofull, I want to build a brand that's meant to be rooted for from the very start.
In an Era of "No Need for the Mass Market," What a Brand Needs to Have
—— Listening to you, I get a consistent sense of an entrepreneur's perspective. Going forward, what do you think will be most required of brands building their business around e-commerce?
Kikuchi Going forward, I think there will definitely be an even greater excess of brands. Honestly, we don't need mass-market appeal anymore. How narrow a category can you specialize in? And within that, how many things can you get people genuinely excited about? I think that's what's going to matter most.
I personally resonate strongly with the idea of "co-creation capitalism." I believe that going forward, a brand won't be chosen unless the product is good and customers genuinely know "what this business is aiming for" and "how it wants to move forward."
MVV—mission, vision, values—is normally something you instill within the company, right? But going forward, it needs to be instilled in customers just as much.
Once that happens, a relationship emerges where people feel, "let's take this brand to the top of the world together." Only once you reach that point does a brand truly become strong, I think.
—— So the role of e-commerce isn't just a sales channel either.
Kikuchi I want our e-commerce site to be something like the town meeting hall. I want it to be an open place where, if you just come here, you can understand everything—what Pekofull is thinking, how it's trying to grow, where it makes its profit, and how it gives back to customers.
(Customer testimonials featured on Pekofull's official site)
The "Food Memories" Pekofull Wants to Deliver
—— Finally, could you share a message for Pekofull's customers?
Kikuchi At the root of why I'm doing Pekofull is a regret from my childhood.
I had a dog who was with me from childhood all the way through university, and I wish I'd fed him a wider variety of food, wish I'd given him more food memories to make.
So, just like with people, I want dogs to be able to make all kinds of memories too. And I want eating to be at the center of those memories. That's Pekofull's mission.
If there's anyone out there who wants to make their dog's life even better, I'd love for them to help grow Pekofull together with us. I'd be happy if they could watch alongside us as Pekofull grows into its own.
Rebuilding a family business, and launching a new venture company.
Facing two forms of management with completely different natures, Kikuchi's decision-making has consistently been built around "people" and "relationships."
Rather than novel tactics, it's an accumulation of practical judgments made to keep the business going. The idea that "the brands that survive are the ones whose MVV reaches all the way to their customers" wasn't just spoken as a philosophy—it was built into his day-to-day operations and decisions.
What Pekofull is aiming for is being clear about who to build relationships with, and what kind of relationships, while growing the business. Not a flashy success story, but the accumulation of everyday decisions is what shapes a brand people root for.
