Russell Hata is the third generation of his family to run food service supplier Y. Hata, having saved it from what seemed like certain bankruptcy. Why did he do all that work? ‘Because my name is on the sign.’<\/p>\n
It’s an exciting time at Y. Hata & Co. The local food-service distributor is celebrating its 100th anniversary and looking forward to the next 100 years.<\/p>\nngg_shortcode_0_placeholder\n
To mark the occasion, its headquarters at 285 Sand Island Access Road is spruced up with fresh paint and new contemporary d\u00e9cor. Employees hail kukila i ka nu’u <\/I>(strive for the summit).<\/p>\n
A centennial comes once in a lifetime, so Y. Hata is taking the opportunity to rejuvenate and fortify itself for a new era. It cleverly positions itself as a “brand new century-old company.” But there is honesty and strategic fervor in that tag that belies the company’s story of endurance and survival. Just 20 years ago, it was on the brink of bankruptcy with its banker commanding “shut it down today.”<\/p>\n
How did it survive that stormy time, and what gave it the will and resilience to keep on trucking? How has the turnaround affected employees and customers? With profitability restored, what else can it now deliver to our community besides food products to restaurants and institutions?<\/p>\n
To get answers, we head to the office of Russell Hata, third-generation chairman and chief executive officer of Y. Hata & Co. Ltd., to whom credit is given for orchestrating the turnaround.<\/p>\n
The thriving enterprise operates in a 107,000-square-foot office and warehouse that is stark contrast to the tiny Big Island garage where it all began. As we view a wall of historic photos, Hata turns back the pages of time. The company’s story is folksy but has lessons to which all businesses can relate.<\/p>\n
Y. Hata & Co. was started in Hilo in 1913 by Russell’s great-grandfather, Yoichi Hata, an immigrant from Hiroshima. He and wife Nacko ran a small wholesale products operation and sold candies in front of their residence. Yoichi expanded the business rapidly and accumulated enough wealth to educate his 10 children at top universities. The youngest, Frank (Russell’s dad), tended to the family business at a young age.<\/p>\n
Now chairman-emeritus, Frank recalls, “I used to play hooky from school and go to the pier to haul rice from the ship with my brother.”<\/p>\n
Older brother Minoru moved to Honolulu in 1938 to expand Y. Hata. Frank was sent to help him during the summer.<\/p>\n
During World War II, patriarch Yoichi was interred in New Mexico as an enemy alien while Frank and brothers served in the U.S. military. Sister Yukiko Hata ran the Hilo operation, and Minoru remained in Honolulu to oversee the business.<\/p>\n
After serving in Europe, Frank returned home to attend the University of Hawaii and work at Y. Hata. He led the company expansion through diversification and acquisition during the post-war years.<\/p>\n
Y. Hata’s distribution line moved into tobacco, beer franchises, dry goods, grocery stores, warehousing, Asian merchandising and trading.<\/p>\n
One of Frank’s business partners was the late Maurice Sullivan, founder of Foodland Super Market, with whom he established Pacific Warehouse, a storage facility for wholesalers.<\/p>\n
By the 1990s, Y. Hata was the dominant food distributor in the state. Difficult times were experienced, however, when the company nearly went bankrupt during the 1971 shipping strike. The worst blow came in 1994 when its Ilalo Street property and distribution center in Kakaako was condemned by the state under then-Gov. Ben Cayetano for future development of the UH medical school.<\/p>\n
Russell recalls the anxiety. “They first gave us seven days to move out, then we negotiated two years so we had to be out of Ilalo by 1996. The worst part was watching a company that became very powerful in the state slowly decline without being able to help it,” he says.<\/p>\n
Russell had worked at Y. Hata as a youngster, doing after-school duty in the stock room and handling janitorial chores. He completed his education at Kalani High School (’73) and University of Hawaii, majoring in business\/finance and mastering the Executive MBA program.<\/p>\n
He returned to the company in 1991 working for his Uncle Minoru.<\/p>\n
“When I took over the company a second time, we had two computers,” Russell remembers. “One was broken, one worked.”<\/p>\n
But fixing “broken” situations seems to be Russell’s calling. The knowledge gained at college plus work experience in Hawaii and the Mainland prepared him for a prophetic call in 2008 when his father asked him to return to Y. Hata for a third time. The company was being riveted by external forces, including a stagnant economy, challenging competition and the ever-advancing march of technology. An earlier attempt to sell the company had been unsuccessful.<\/p>\n
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“At its worst, the company was losing more than $300,000 a month, and for several years we were in negative equity,” Russell recounts. “We were bleeding.”<\/p>\n
By the mid-1990s Y. Hata divested its non-food service businesses to focus on supplying restaurants and institutions.<\/p>\n
In trading fated fortunes, Y. Hata also won a bid on the Sand Island warehouse that was in bankruptcy.<\/p>\nngg_shortcode_1_placeholder\n
“We moved in 1996, installed freezers a year later, and the flood-gates opened,” he says. “In 1997 we were awarded a military contract, the first time in more than 10 years that the company projected a profit.”<\/p>\n
Asked why he went through so much to save the company, Russell is succinct: “Because my name is on the sign.”<\/p>\n
As a wholesaler, Y. Hata is a middleman or link between manufacturers\/suppliers and food service operators, such as chefs, food-and-beverage directors and kitchen operators.<\/p>\n
“We’re a broadline distributor,” CEO Hata explains. “We supply everything a restaurant might buy except fresh seafood and produce. From cleaning supplies, dishes, tabletop items, to food, we have it all.”<\/p>\n
Those are the tangibles. As one of Hawaii’s leading food-service distributors, it represents 9,000 line items from 400 manufacturers.<\/p>\n
But what of intangibles like internal and external relationships that a corporation must align and nurture through good times and bad?<\/p>\n
While the executives and managers hone Y. Hata’s operations to optimum efficiency, Russell orchestrates an overture of inspiration and motivation.<\/p>\n
“Our first obligation is to our employees and customers,” Hata says. “Our employees are our sustainable competitive advantage.”<\/p>\n
A strategic plan called Vision 2011 is a blueprint for cultivating a valued-based corporate culture. With the mission of “Foodservice beyond expectation,” Y. Hata, with $165 million in annual sales, wants to be the “distributor of choice” with “genuine concern for our partners’ success.”<\/p>\n
When Hata came aboard, the company operated seven warehouses on Oahu, Maui and the Big Island. Today there is one each on those islands, and the operation is more efficient. Today it has operations on Oahu and the Big Island. Its distribution center on Sand Island Access Road runs 24 hours a day and boasts state-of-the-art systems.<\/p>\n
“Our growth strategy known as the ‘Road to Haleiwa’ is a journey,” Hata states, “not merely a destination.”<\/p>\n
When everyone’s onboard, the trip to profitability is faster and smoother, according to the 57-year-old CEO.<\/p>\n
In turn, customers benefit from responsive customer service, value-added partnerships, and a level of trust that is as precious a commodity as inventory in the warehouse.<\/p>\n
Revitalized Y. Hata has developed a number of firsts in Hawaii’s food distribution industry. Among them are technology-based management systems, activity-based costing, as well as unique organizational and sales support programs.<\/p>\n
“We’re probably the most technologically advanced distributor in the state,” Hata says proudly.<\/p>\n
Major investment also has gone into making Y. Hata a “green” environmentally friendly operation. Initiatives include sustainability programs such as electrical panels, a photovoltaic system, LED lighting and energy-efficient doors to reduce energy costs, resulting in a savings of 30 percent or $30,000 a year. The company has one of Hawaii’s largest photovoltaic solar systems installed by Sunetric two years ago. The $2.5-million system produces an average of 2,636 kilowatt hours of electricity each day, off-setting 22 percent of its current electricity usage.<\/p>\n
Corporate responsibility extends to community causes. Y. Hata sponsors scholarships, has an internship program called DINE (Diversification, Innovation & Entrepreneurship) Apprentice, and recently enriched Kapiolani Community College with a $100,000 donation for its Culinary Institute of the Pacific project.<\/p>\n
Y. Hata’s test kitchen, headed by executive chef Ernesto Limcaco, gives local chefs a venue to try to new products, train personnel, and consult with food specialists on menu planning and costing.<\/p>\n
“Our hope is to be perceived as the best in the market,” Hata says. “That includes being top of mind with John Q. Public, from whom we must hire future workers.”<\/p>\n
Typical of forward-thinking executives, Hata is mindful of both success and succession.<\/p>\n
So the next time you see a Y. Hata delivery truck on the road, give the driver a shaka sign and smile. You’ll be saluting a 100-year-old tradition of delivering the goods.<\/p>\n","protected":false},"excerpt":{"rendered":"
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