Sunkist Squeezing Out Higher Sales in Japan : Agriculture: The growers’ cooperative changes attitudes and wins a 65% share of the citrus import market.

To Sunkist Growers Inc., it sounded like a juicy deal.

In 1983, U.S. and Japan negotiators struck an agreement to increase import quotas on oranges by 37.5%. The deal was a prelude to the 1988 deal, which doubled allowable annual increases and set April 1, 1991, as the day for removing all quotas.

Suddenly, the Sherman Oaks-based firm was eyeing vastly expanded access to one of the most significant consumer markets in the world.

There was only one problem. The Japanese viewed foreign oranges as gift items. In the land of ritualized gift-gifting, where elegantly wrapped melons can sell for $80 apiece, oranges were not a thing to be casually peeled and popped in the mouth as they are in the United States. At as much as $3 apiece, they were carefully selected, packaged and presented as a specialty item.

Sunkist believed that those consumer attitudes would limit foreign sales as surely as government restrictions. So the firm set out to change them--demonstrating anew the acumen that has made the California firm the dominant foreign player in Japan’s citrus market since first arriving in 1964. Sunkist, a growers’ cooperative, enjoys a 65% share of the citrus import market.

“As the quota increased, we had to do something about this perception and find a way to increase consumption in Japan,” said Gene Sass, Sunkist’s director of international marketing. “So we began promoting oranges as something to take home and eat with your family.”

The firm introduced “family packs,” plastic bags containing six oranges and instructions on how to cut the fruit into wedges, or “smile cuts.” The idea took care of three problems: persuading the Japanese to eat oranges at home with their families, teaching them how to cut and eat oranges (they peeled them instead) and persuading them to eat smaller oranges as well as the big ones selected for gifts.

“It was an uphill battle because we had to persuade importers and supermarkets to buy and stock the smaller oranges,” Sass said, “but we were successful.”

Sunkist is also promoting home-squeezing to increase consumption. Although eating one orange will usually satisfy an appetite, it takes three oranges to make one glass of freshly squeezed juice.

In its promotional literature, the firm instructs consumers how to make decorative cuts in oranges, with names such as “Half Moon.” And it is careful to emphasize the California birthplace of the fruit.

“The Japanese are very much intrigued by California--the sunshine, palm trees, warm, blue Pacific Ocean,” Sass said. “Interestingly enough, we have found that promoting citrus from the United States is not as effective. A fairly good percentage of consumers think of General Motors, Ford, automobiles. You don’t want to sell citrus, a fresh product, that way.”

To deliver the top quality demanded by the Japanese, Sunkist ships better fruit to Japan than it sells in the United States. The firm also runs its own inspection service before loading cargo at Long Beach and unloading in Tokyo and Kobe. It is the only foreign citrus firm that does so, Sass said.

The firm uses a charter vessel service so it can get more competitive rates, better handling of its fruit and more control over shipping times.

From 280,000 cartons of lemons sold in 1964, Sunkist now annually ships out 11 million cartons of lemons, oranges and grapefruits. Its orange exports to Japan have quintupled in the past decade, to 5.5 million cartons in 1990 from 1.3 million in 1981.

But Sunkist’s success hasn’t pleased everyone. In recent months, the firm has been broadsided by a campaign against imported food launched by Japanese groups associated with Japan’s agricultural cooperatives. One charge is that imported lemons are contaminated by the same chemical used in the defoliant Agent Orange.

Athough U.S. growers and government officials denounce the campaign as lies, it seems to be paying off. In the past four months, imported lemon sales have dropped by 15%, said Sunkist spokesman Curt Anderson.

“We’re doing all we can with our embassy and officials, but that’s the way they do things, and it’s very difficult to combat,” Anderson said. “They’re going to do all they can to keep the fruit out, no matter how safe and good it is, no matter how many lies it takes.”

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