KTA Super Stores: Beyond the Bottom Line

The traditional Japanese concept of kaizen — “continuous improvement”  or “changing for the better”— has carried KTA Super Stores beyond its centennial anniversary as a family-owned business. The founders’ focus was not solely on the bottom line. For over 100 years, KTA Super Stores has been committed to its founders’ philosophy: to humbly serve and do what is right for the community.

KTA Super Stores began and continues to operate by honoring the partnerships built by previous generations. These principles and values continue today from the founders as the basis of the development and growth of KTA’s business model and its relationships with its partners, customers, staff and each other.

KTA President and COO Toby Taniguchi’s great-grandparents, Koichi and Taniyo Taniguchi, moved to Hawai‘i inadvertently. During his emigration from Japan, Koichi had stopped in Hawai‘i on his way to California, where he had planned to settle. Early 20th century immigration controls stranded him in Honolulu, where he was visting a cousin. Eventually, he made his way to Hilo, where he enrolled in the Hilo Boarding School and learned bookkeeping. On his own and with no family on the island, he found work with a wholesaler and eventually sent for Taniyo. Former KTA President Barry Taniguchi’s father, Yukiwo, was born in 1916. The story goes that his grandfather told his grandmother that with another mouth to feed, they’d need more income. The store was created to provide income to support Yukiwo. Koichi figured Taniyo could watch the store and care for baby Yukiwo — and their eight children that followed.

They founded the company later that year. Their first operation was a modest, 500-squarefoot grocery and dry good store in Waiakea (Hilo) that served sugar plantation workers. Their simple mission was to help family and friends obtain necessary grocery and household items as the sugar-based economy began to decline.

Early on, Koichi delivered the much-needed merchandise by bicycle. In time, the couple built their pickup-and-delivery business to the point where they were able to afford a “real” store.

Executive Vice President Derek Kurisu says that when the sugar plantations were going under, Koichi and Taniyo’s son, Tony, who eventually succeeded founder Koichi, said he felt it was his obligation to help the agricultural community.

Also growing up in the Big Island plantation culture, Derek thought, “I also have got to do something to help. In crisis is opportunity.”

Derek has worked with four generations of KTA Super Stores presidents: Toby is the fourth.

By 1940, a branch store was established in Downtown Hilo. This proved to be fortuitous when the original structure was destroyed by the 1946 tsunami. This Downtown branch, converted into a supermarket in 1953, was followed by the opening of the Kailua-Kona store in 1959 (relocated to its present location in 1975). Seven years later in 1966, the flagship Puainako store was opened, followed by Keauhou in 1984 and the Waimea store (located in Kamuela) in 1989.

In 1984, then CEO Tony, his nephew Barry (Toby’s father) and Derek developed Mountain Apple Brand partnerships to create more employment and support a “buy local, take care of local” dynamic. The private-label promotes products grown or manufactured in Hawai‘i.

In 1990, a sixth location, was opened to serve the growing community of Waikoloa Village, and in 2018, KTA Express Kealakekua opened.

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The KTA Principals, Past & Present
Koichi and Taniyo Taniguchi
Original owners, Toby’s great-grandparents
Yukiwo Taniguchi, called “Mr. Y”
Barry’s father, Toby’s grandfather
Tony Taniguchi
Former CEO, Barry’s uncle, Toby’s great-uncle
Barry Taniguchi
KTA chairman and CEO, Toby’s father
Toby Taniguchi
Fourth-generation president and COO
Executive Vice President Derek Kurisu

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Employee Number 11

KTA’s No. 1 man is actually employee No. 11 in the roster of the thousands of people who have worked at the company over the last 104 years.

At age 16, while still in high school, Derek worked part-time for the Taniguchis at the first KTA in Hilo. He said he had to carry a 100-pound bag of rice for a distance to get hired as a bag boy.

Koichi and Taniyo’s son Tony eventually succeeded founder Koichi. Another son, Yukiwo, aka “Mr. Y, ” also worked at the store. He was the father of former KTA President Barry Taniguchi, Toby’s father.

Derek worked with them all — four generations of Taniguchi leaders at KTA.

Every day, Koichi, would sweep the sidewalks in front of the store, Derek says. “People who would see him thought he was the custodian.”

“I can still totally recall the first lecture I ever received from Mr. Taniguchi,” he said. “One day, I went to open a 50-pound rice bag with my case cutter. Mr. Taniguchi told me, no, open it with the string. Rice was a sacred thing 50 or 60 years ago. That is when I realized what KTA was about.”

“The values we use in our store to this day, — taking care of the products, the people, the employees, the customers — keep passing down from generation to generation,” says Derek.

“We continue to grab the old and blend it with the new and move forward,” says Derek. “I am blessed to be able to share the old-fashioned values I learned working at KTA.”

Change for the Better

Toby did not always envision a future with KTA. He went to college at the University of Portland and wasn’t sure he was going to come back to Hawai‘i at all. He had a girlfriend there and wanted to “hang around,” he says. But as fate would have it, they eventually broke up.

“Everything happens for a reason, I guess,” says Toby. He contemplated his next move.

When Barry went to Oregon to attend his daughter’s graduation from another university, he asked Toby about his plans for the future.

“I’m not sure,” Toby replied. “I had a job working for a wholesale printer and they were going to pay for me to continue my education. Then the breakup came. So I wrote dad a letter and asked him if there might be a place for me — because I wanted to come home.”

“Barry must have been super-relieved that Toby decided to come back and work,” says Derek. “But Toby didn’t just come back to work to stay upstairs in the office,” says Derek. “He’s downstairs bagging groceries and doing all the jobs.”

“The Japanese saying, okage sama de, means ‘I am what I am because of you.’” says Toby. “For me, the ‘you’ is Derek, and my uncles, aunts, and business associates who have a lot more experience than I do. You can’t get these things from a book. And I am still learning. I strive to hold onto the values of the past while looking toward the future. That’s what the business philosophy kaizen is — changing for the better.”

KTA Partner: Hirako Farms Justin Hirako, age 28, aims to carry on his family legacy as a member of the fourth generation to run Hirako Farms.

 

Justin’s great-grandfather, Seijiro Hirako, left Japan and came to Hawai‘i as a plantation worker. In 1928, he started Hirako Farms. Due to illness, Seijiro was unable to continue running the farm, so the task fell on his son Kiyotsugu’s shoulders at age 17. He was a teenager, still in high school.

 

Kiyotsugu later married Shizuko and they had four children. Three worked in the family business — Roger, Norman and Justin’s dad Jeffrey.

 

The farm has expanded from 20 to 100 acres across Waimea and employs six family members. Justin’s Uncle Roger serves as president of the company; Uncle Norman is the secretary; Justin’s father is the vice president. Justin’s mother Elaine and Uncle Roger’s wife Deborah manage the greenhouse. Justin is the only member of the family’s fourth generation to continue on at the farm.

 

Justin’s plan to take over the family business was the catalyst for his academic pursuits. He is well-qualified to take on the responsibility, earning an accounting degree at the University of Hawai‘i at Hilo and an MBA from Hawaii Pacific University on O‘ahu.

 

“It was a pragmatic choice,” says Justin. “I always wanted to keep the option open for helping with the family business but I also wanted to have a background in something else just in case. I grew up on the farm and I grew to love Waimea so much. I’ve been very fortunate to have gone around the world, but there is really no where else like Waimea. That’s what drew me back here.”

 

“The farm is a very dynamic operation, so my degrees tie in well with marketing, accounting, finance and all the moving parts that need to be tied together,” Justin says. “You must have a really good understanding of everything that makes the overall machine work.”

 

“We have been working with KTA for over 50 years now — dating back to my grandfather’s time,” says Justin.

 

Their relationship actually predates KTA’s Mountain Apple Brand, according to KTA Executive VP Derek Kurisu. “We have been very fortunate to be partnered with KTA. They have been willing to support local businesses like us. Without them, we wouldn’t have been able to be where we are today.”

 

 

KTA Partner: The Happy Mochi Maker
At one time, Gladys Sakoda Harada was a very successful hairdresser. She had a salon in Hilo. When her mother needed care as she aged, she moved the salon to the basement of the family home. Eventually, care became more demanding and Gladys gave up her appointment driven hairdressing work.

 

“My mom always used to make mochi to give away to friends,” says Gladys. “I decided I needed to learn the art before the teacher was gone. I wanted her to see her products in the markets before she left.”

 

Gladys contacted KTA VP Derek Kurisu and asked him if he could sell her mochi. So in 1998, her basement kitchen became her certified mochi factory. Her mom, a second-generation emigrant from Japan, was her teacher. Gladys’ mother had gained her knowledge, not from her mother, but from working in a mochi factory in Hilo.

 

“The mochi just happened,” she says. “Everything fell right into place for me.”

 

Gladys learned how to make ohagi, sekihan and zenzai, among others. Her big sellers are chi chi mochi and peanut butter mochi — originally a
special request from Derek.

 

Mochi holds a special place in Japanese celebrations as well as those of other Asian countries.

 

“My son-in-law brought ohagi to work one day and gave some to his boss,” says Gladys. “It really touched my heart when his boss took his first taste and a tear welled up in his eye because it reminded him of his grandma. She used to always make ohagi for his birthday. My mother would always make that for my birthday, too.”

 

Derek says her mochi is special. “It is the old fashioned Japanese kind that you wouldn’t find anywhere else. She has a special touch. As soon as she brings it, it is gone from the shelf!”

 

Gladys has been delivering her mochi to the Puainako KTA Super Stores location every day for the last 22 years. But the art might end with Gladys, she says, as her children are educators — “not the kitchen type. I am kind of thinking it will die when I die, but I hope not.”

 

Her teacher-mother passed away 12 years ago. Gladys will be 79 in April.

 

“I am thankful and happy to be a part of KTA’s Mountain Apple Brand,” says Gladys.

 

“Question is, how long am I going to keep doing this?” Gladys asks. “I feel it would be selfish of me to stop making mochi if I’m still healthy and my hands can still move. If health can keep up with me, I’ll keep making my customers happy. Don’t you think that’s the best way to live life — making people happy?”

“We’re trying to improve ourselves, whether it’s the use technology or the leveraging of technology, or innovate ways to improve safety, customer satisfaction and employee moral. It has been super-impactful to KTA,” says Toby.

Toby’s beloved mentor, his father Barry, passed away in September 2019.

“When I was cleaning up his office over the next several months after he died, I found my letter in one of his desk drawers… it’s my drawer now, but…” Toby took a moment as he recalled memories of his dynamic dad.

The letter that asked if Barry had a place for his son at KTA signified a pivotal point in the Taniguchi family’s business and Big Island history.

It’s All About Relationships

“There are part-timers, full-timers and life timers at KTA,” says Toby. “The company is very fortunate that we have dedicated and loyal family-like members like Derek. He is talented, dedicated and loyal. I think Derek is a perfect example of an individual who invests in building relationships.”

“Whether it is through our purveyors, farmers, ranchers, fisherman — I think he has demonstrated though his actions that relationships, at the end of the day, are super-important,” says Toby. They help build trust. They help build win-win situations and scenarios, whether it is a farmer growing tomatoes or anyone else we work with.”

“I think it is important to just be humble and realize that you are never better than anyone. By the same token, no one is ever better than you. Be humble; be respectful; treat people the way you want to be treated. I think that maybe helps.”

“I think people don’t care how much you know until they know how much you care,” says Toby.

“Derek shows that in his relationships with everyone, including our partners. I try to show that to my team members — the associates — as well. Just be honest and authentic.”

“We try to keep our associates in the game because they are frontline essential workers, like a nurse or doctor at the hospital,” says Toby. “They are essentially feeding our community. So the question we now ask is what can we do to ensure that they are safe and feeling appreciated. We want them to know that we appreciate them. We know that they have choices in where they work and we’re grateful they choose to work at KTA.”

Toby and Derek both expressed their appreciation for multi-generations of customers.

“The senior customers bring their children and now they are bringing their children’s children, so we see generations of people in the store,” says Derek. “It makes you feel really good to have multi-generations shopping in our stores. We are so fortunate and so humbled and so happy that, you know, really, I think we have the best customers in the world.”

KTA Partner: Kulana Foods 
Kulana Foods Ltd., which began in 1937 in Hilo, is the island’s only full-service slaughterhouse. The family-owned company has supplied wholesale meat to KTA for three generations. “We buy all our local pork and beef from the Yagi family, who owns Kulana,” says KTA Executive VP Derek Kurisu. “They do a lot of value-added processing, like Portuguese sausage, pipikaula and other things. We have had a very close relationship for three generations.”

 

Mountain Apple Blossoms
As one of the few surviving large family-owned businesses on Hawai‘i Island, KTA leaders are passionate about championing other local businesses. Derek led the development of the company’s Mountain Apple Brand beginning in 1984. The private label consists of products grown, processed or manufactured in Hawai‘i. Long-time suppliers have become like family to the KTA organization.

It started at the beginning of the decline of the sugar industry during Tony and Mr. Y’s time.

“We were able to get about 40 different partnerships, everybody working together, to actually create more employment and make sure people had jobs,” says Derek. “That was a very important time. The whole philosophy was to support local, buy local, take care of the locals. We went all out to take care of the local community. Tony, Barry and Toby really embraced that.”

“There are many suppliers on our island that we have worked with for at least three generations, including Hirako Farms, Kulana Foods and others” says Derek.

“I actually worked with the founders of these companies,” Derek says. “We have a long history of working together. We grew together. They grew, we grew. We grew, they grew. Together, we are all still here. Over 100 years and we are all still here doing business. We are keeping the economy going on our island. I feel so proud to work for this company. We stuck with other companies like family. Now their grandchildren are taking over the business.” Derek says they sometimes express concerns about who will carry on multi-generations business. “Hopefully, they will for many more generations.”

To date under this brand, over 50 local vendors supply more than 200 products, including milk, meat, juice, eggs, coffee and desserts.

That’s Show Biz

Not many retail and grocery businesses also have their own TV show. But in keeping with the “KTA way,” it makes perfect sense. KTA President Barry gave Derek the green light on “People Living in Paradise” in 1995.

“Twenty-five years ago, a lot of negative news was being circulated about the island via the media,” says Derek. “Teachers were on strike at that time. I was already going to the schools then because Barry wanted me to go out and help the community and be part of it. I also spent a lot of time in the schools because I knew they would be our next generation of customers and the next generation of people we would hire.”

So an idea emerged to create a cable show that would feature only the shiny side of the tarnished Big Island coin.

“The show was based on the same concept and philosophy as the Mountain Apple Brand concept; people working together to promote the positive things about this island,” says Derek. “What we did for products and people through Mountain Apple, we did for people of all ages, from all walks of life, in our TV shows.”

“We started off with ‘People Living in Paradise,’ then broke off with ‘Seniors Living in Paradise’ to highlight the importance of the senior population. At one time, there was a big disconnect,” says Derek. “My goal was to have both a seniors’ show and a family show so that both generations could understand each other. I wanted the younger people to understand the values of the seniors and the seniors to understand the younger kids.

“That’s still what it is about today; a lot of lessons about understanding each other; all positive; all good; all local; promoting the positive about being local and making our island a better place.”

Along with cohost George Yoshida, Derek fostered relationships with seniors across the island. After George passed away in April 2019, Derek took over the show.

“This was so disconnected from what we do as a supermarket,” says Derek. “But it’s part of the Taniguchi family to go beyond the walls of our company and make our island a better place.”

The show started on Oceanic Cable, which has now been switched to Spectrum.

The two one-hour shows, which change content once a month, are on every day on Spectrum Cable Channel 129. “People Living in Paradise” is on daily from 7:30 to 8:30 pm and midnight to 1am. “Seniors Living in Paradise” shows daily from 6:30 to 7:30 pm, as well as Monday through Friday from 6 to 7am.

Moving Forward

“Derek’s innovations and creativity in bringing products consumers will appreciate and helping organizations and institutions has set us apart from the competition,” Toby says. “Our close relationships with our customers keeps us apprised of relevancy and their needs. I think that’s what helps us stay relevant in this world of large conglomerates. We try new and different products and services; if they don’t work, we stop. We constantly try to improve and innovate.”

“We have a lot of the big boys in Hilo… the Walmarts, the Targets, the Safeways,” says Toby. “The programs Derek brings to market reflect KTA values. These are not programs that the national chains create. I give all the credit to Derek.”

Derek, who has worked at KTA for over 50 years now, says he tries to give 110 percent. “My words and actions represent over 800 employees and all of our buyers,” he says. “It’s very tough but it keeps you straight and keeps you motivated to try your best and move the company forward.”

Although they are continually working to appeal to a new generation, it is equally important to them to maintain the core values and service that his great-grandparents established.

“As my dad said, the company has never been solely based on the bottom line,” says Toby. “It’s based on what’s right for the community, our partners and our associates.”

“We’re at a crossroads now,” says Toby. “My siblings, cousins and I have children, but none have expressed interest in the business yet. Some of them are still young. We are fortunate with our associates and individuals like Derek who have been with our organization for a lifetime. But we are at a point where we need to start really having some serious conversations with regard to a fifth generation who will continue the KTA way.”