PRC Partners was invited to the Trunk Hotel in Tokyo to witness the B2B launch of NeutriSci Internationals (TSXV:NU, OTC:NRXCF) distribution partner Tabletz LLP. Our associate Sven Harpering went to the show to check it out. Mr. Harpering is a German national who has been living in Japan for more than 12 years, speaks fluent Japanese, and is familiar with the business culture in Japan.
The show took place on the 4th and 5th of November in the prestigious Trunk Hotel in Tokyo, a well known place for influential business people and hipsters. Entrance to the show only by invitation, if you weren't a VIP, purchasing executive, known influencer or happened to inherit a multi billion dollar retail conglomerate you weren't allowed in.
1) THE TABLETZ BOOTH AT THE TRUNK HOTEL IN TOKYO
Minimalistic, sterile design, hitting the taste of Japanese consumers spot on. The interesting part of this booth is that due to the pandemic, they implemented a livestream feed on a tablet, so that questions could be answered from the Tabletz headquarter in California. Due to this, the amount of people to the booth was mostly limited to 2 potential clients at a time.
2) VIPS of the Japanese retail industry discovering CBD
In case if you are wondering why you do not see thousands of people at the booth, beating each other up for samples and freebies let us explain the nature of this show. This was a very exclusive B2B show by invitation only, one of which we have not witnessed before in Japan. The Who is Who of the Japanese retail industry was present, as a matter of fact we were forbidden to take pictures and videos of most people, at one point we had been asked kindly by the security guards to delete pictures of well known influencers, purchasing managers and owners of retail conglomerates. In a nutshell, the key decision makers of the largest retail and distribution chains were present, including the heiress of Japans largest drug store retailer, the equivalent to the Waltons in America.
Just to name three groups that we saw at the show.
1) Matsumoto Kiyoshi, Japan’s largest drug store chain by revenue. Number of locations: 1,654 and about 3.8 Billion USD revenue.
2) Lawson Japan Lawson, Inc. (株式会社ローソン) is a convenience store chain in Japan. Number of locations: 14,691
3) Seven & i Holdings Co., Ltd.(株式会社セブン&アイ・ホールディングス): Number of locations: 67,480 stores around the globe, 20,700 stores in Japan.
and many many more.........
(Masaaki Ikeda answers questions about Tabletz with potential clients directly via livestream.)
We estimate that Tabletz dropped around 30,000 - 50,000 USD on this 2 day show, which indicates to us that they are committed to establishing the brand for the long term. In our opinion they did well in combining the show with featuring the products and at the same time educating potential clients about CBD and its advantages, which are still unknown to most people in Japan.
The impression we got from eavesdropping in on some of these potential clients is that many of them want to take advantage and be the first in the market, we also overheard that potential clients were planning on placing orders. There was sincere interest and people understand that this is a future market that will reward first movers.
We recommend that you watch the video till the end, as you can see how the livestream with potential clients was conducted.
3) THE BIG BOSS: NAKANISHI TSUYOSHI
After we spend some time at the booth and mingled with other attendees, we were able to speak briefly with Nakanishi Tsuyoshi, the CEO of BrownSugar Company, the exclusive importer for Tabletz LLP. We were brought upstair into a private office and spoke about his views on CBD, Tabletz and the potential.
So first of all, who is this guy ? Nakanishi Tsuzoshi has made his fortune with fashion and lifestyle products, building brands and marketing is what he is best at. A very humble, yet confident Japanese business man, that rubs shoulders with the biggest names in the fashion, lifestyle and consumer goods industry in Japan.
What did he say? In a nutshell, he is very confident about the Japanese market and Tabletz, he sees the need to educate retailers and distributors about this brand new thing called CBD. Right now he considers it a niche market with the potential for rapid expansion over the next few years. He is also eying other Asian countries for distribution, especially, Korea and Thailand. He mentioned that the product range for Tabletz will be expanded to go after specific retail segments of the Japanese market.
4) PEZ candy is for children, Tabletz is for adults !
Do you remember the days when you saved up all your coins as a little child and then went to the small corner store, spending 30 minutes at the candy section, facing a hard choice on which PEZ dispenser you are going to purchase with your meager financial resources? They are still around and PEZ is huge in Asia, as a matter of fact 7 Eleven sells them in most of their stores. We believe that the design and branding of Tabletz was, ... well somewhat inspired from PEZ, a brilliant marketing move, that we believe most people have overlooked. The brand immediately wins trust due to the similar font style of the logo and the Tabletz sticks are the grown up version of the children's PEZ dispensers.
In our opinion, the show was well organized, informative and was a success to introduce Tabletz to the key decision makers of the Japanese retail industry. We did not expect to encounter these retail calibers at the show and have a good feeling that NeutriSci International has definitely chosen the right distribution partner in Japan. The feedback and interest in their product line was better than we had anticipated. The design, packaging and the branding style of the company is spot on with the taste of Japanese consumers.
It is essential that they take advantage of their retail power and come up with additional products, especially in the beverages market, NeutriSci International should implement their technology into drinks as soon as possible. It is important to understand that Tabletz is taking a 100% - B2B approach, establishing the distribution channels first, before they start with big marketing campaigns to make the brand famous throughout Asia.
Further, we are delighted to see that NeutriSci International has learned from their mistakes in the past and is leaving the marketing and brand building to the experts and is focusing on implementing its unique technology and intellectual property into high profit margin products.
Please note that PRC Partners is a shareholder in NeutriSci International and therefore a conflict of interest exists, this report is not intended as a buy recommendation, please consult a financial advisor before making any decisions. Please read our full disclaimer.