Satisfaction and the City

The boss of city’super Group is selling a lifestyle, not just meat and vegetables. THOMAS WOO spoke with glen watson shortly after winning an Ernst & Young award for entrepreneurship

BORN IN HONG KONG, city’super President Thomas Woo credits his mentor Masashi Ishikawa, along with his own curiosity, for a career path that has led to the success of the city’super chain of luxury supermarkets.

While attending Eastern Oregon University in the 1980s, Woo learned from a Japanese friend that Seibu department store was hiring foreigners. Out of curiosity, he applied. He got the job, in men’s fashion, but was able to finish his studies before joining Seibu in Tokyo. Ishikawa was his boss there.

Eventually, Woo moved back home to work with Ishikawa and run the men’s fashion department at Seibu in Hong Kong. “Ishikawa fell in love with Hong Kong and had the concept for city’super here, so he found an investor,” Woo recalls of the supermarket chain’s founding in 1996. “I’ve been working with city’super since day one.”

In 2002, shortly before Ishikawa died of cancer, he handed the city’super baton to Woo. “He was quite challenging and pushed me to grow.” Woo reckons that the main reason for a company to keep evolving is to provide opportunities for staff to advance. “Growth is not only about satisfying shareholders, but also staff and colleagues. It’s not about maximising profit. It’s about appropriate profit, necessary profit. It’s not just integrity; it’s growing future leaders.”

Woo, 47, was recently named the Ernst & Young Entrepreneur of the Year 2011 for China in the consumer products category and country winner for the Hong Kong/Macau region. This summer he will travel to Monte Carlo with the other category and regional winners who are up for the world entrepreneur of the year award.

On the day we meet, Woo is being photographed by Prestige Hong Kong at the city’super store in Tsim Sha Tsui. While standing at the main entrance, slightly blocking customers from entering, Woo steps back several times to let them pass, smiling the whole time and saying hello. It’s immediately clear that he’s a people person. Later he makes the sincere point that winning the regional Ernst & Young award is not personal. “It’s about our city’super team being recognised,” he says. “As a team, we’re excited and honoured.”

Woo didn’t even know about the award, which has been handed out for the past six years, until he was nominated by a business friend. “I never do that kind of thing,” he admits. So he looked into it and when he learned that the award’s annual theme was Growth Through Innovation, he thought it was a good way to promote the principles by which he operates the retail company he helped launch in Hong Kong 16 years ago.

“We’re not supermarket people, but lifestyle. We know and understand people. We want them to feel excited when they’re shopping, to come to city’super for fun and to browse. They can try stuff they’ve never tried before. Our motivation is their enjoyment. It’s not a normal supermarket, where you get in and get out.”

This customer-experience point of view is why there are usually free samples being handed out, as well as cooking demonstrations and all sorts of activities that customers can enjoy through the Superlife Culture Club, begun eight years ago.

A customer might come to the store for Japanese food, which accounts for about 30 percent of what’s on the shelves, then learn more about food from Japan and other countries through the demonstration tables that dot the aisles. “Cooking is entertaining, like karaoke,” Woo says. “We share and promote food knowledge and the joy of cooking to our customers.”

He compares shopping at one of his stores to treasure hunting. “We carry so many great products from around the world – if you know them, you know them. So, it’s our responsibility to teach, provide recipes and have staff helping our customers.”

When it comes to sourcing these products, city’super again relies on building relationships. This time, it’s with the suppliers. “We go deeper,” Woo says in describing the vertical integration of the store’s suppliers and their products. This includes owning a rice farm in Japan and building ties with an apple farm there that’s part of another relationship that leads to making juice for city’super customers.

“Our Japanese food buyers live in Japan. We have staff in Italy to buy food in Europe and in San Francisco to buy in the United States.” City’super buyers will go truffle hunting, visit small pasta producers and source the best caviar for customers. Woo says city’super is exploring more relationships with Mediterranean food suppliers while extending its buying network to places such as South America. “It’s easy to imitate us and our ‘hardware.’ But the ‘software’ of our global merchandising network relationships is not replaceable.”

City’super, owned by Fenix Group Holdings, has four city’super stores, seven LOG-ON stores and one cookedDeli in Hong Kong, three city’supers in Taipei and the recently opened mainland flagship at ifc Shanghai. Woo says revenues have increased 20-fold since the first store opened in 1996.

“The big difference between our company now and when it was founded is that there’s more depth in it,” he explains. “We have a deeper understanding of our business and our customers. We bring in the best from around the world and have come to understand that people don’t just come to buy products. Satisfaction doesn’t end with consumption, or at the cashier, or when a product is put on the shelves.”

This ongoing relationship with customers extends to social media that didn’t exist in 1996. “We use Facebook and Sina Weibo to promote our company and products. We have 10,000 Facebook friends and 8,000 on Weibo. If we put a product on Weibo, it’s usually sold out in a couple of days. If we post a video online, people come to the stores. We’re starting to see, and manage, that – it’s stunning, so fast…instant.”

Woo is focusing on expanding in China over the next few years, as well as revamping the Times Square store and opening another outlet in Hong Kong by 2014. “The job of a leader, in any company, is to build the company not just for this year but for the next 10 to 15 years,” he declares. “It’s not about today’s business, but tomorrow’s.”