Fujiya to Beef Up Cake Shop Network for Biz Turnaround

Tokyo, Aug. 1 (Jiji Press)–Scandal-tainted Fujiya Co. will beef up its tattered cake shop network in an effort to return to the black on an operating balance in fiscal 2009 that ends in March 2010, Fujiya officials said Wednesday.

Fujiya, now rehabilitating its operations with support from Yamazaki Baking Co. , will include the plan in a three-year business program to be announced as early as next week, the officials said.

The major confectionery maker has lost consumer confidence since the company earlier this year was found to have used old ingredients in making various products.

Struck hard by the scandal, Fujiya incurred a group operating loss of 6,659 million yen in fiscal 2006 that ended last March. For fiscal 2007, the company expects its operating loss to increase to 8.5 billion yen.

Under the three-year business program, Fujiya will aim to actively open fresh cake shops in the Tokyo metropolitan area and such big cities as Nagoya and Osaka in a bid to boost the number of such shops, including franchised shops, to 1,200, the officials said.

In addition, Fujiya will renovate some cake shops so that they will sell fresh-baked bread supplied by Yamazaki Baking, they said.

The number of Fujiya’s cake shops has fallen to some 630 from about 800 as many franchised shops were forced to shut down due to the fallout from the scandal.

From September, Fujiya will supply frozen cakes to Yamazaki Baking, a step designed to raise the operational rate of its plants, the officials said.

Fujiya will also implement steps to shore up sales of its confectionery products such as Milky candy and Country Ma’am cookie, as well as drinks including fruit juice. The company will market those products partly through convenience stores of Daily Yamazaki Co., an affiliate of Yamazaki Baking, the officials said.END

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