Gargiulo: Quality is key to improved grower returns
Gargiulo: Quality is key to improved grower returns
VISALIA, CA " The mission of Sunkist Growers Inc. " to provide the highest returns possible for quality California and Arizona citrus growers " has not changed in over 100 years, Jeff Gargiulo, president and CEO of Sunkist, said at the organization's annual meeting.
Speaking to more than 800 growers attending the citrus cooperative?s 111th annual meeting here on Wednesday, Feb. 16, Mr. Gargiulo and Sunkist Chairman David Krause, president of Paramount Citrus Association in Delano, CA, outlined several key building blocks to improved grower returns. Among them were industry unity, Sunkist leadership, the "Sunkist? brand and maintaining high quality standards.
Prior to last year, the industry had suffered several years of very poor returns. But last year, "net on-tree returns jumped dramatically, reaching profitable levels over cultural costs," said Mr. Krause. "In 2005, year-to-date performance continues to show positive results from the previous year."
While several factors have contributed to that, including the ability of the recently formed California Citrus Growers Association to manage supplies, Mr. Gargiulo stated that "Mother Nature had a big hand? in last year?s profitable season. "Last year, the [Navel] crop was good quality, not too big a quantity, good size structure and one that lasted a while. It was a good crop to sell."
That was helped by CCGA managing the supply to assure "consistent supplies in the market and in the stores of high-quality fruit on a weekly basis." That is good for customers, good for consumers and good for grower returns, he said.
This year?s Navel crop is more challenging, Mr. Gargiulo said. "We?ve got a much more difficult crop in oranges." Sizes are larger, and "there are more of them. They aren?t as pretty. The weather hasn?t cooperated." There have been some freezes and "a lot of rain," and the fruit will not "last as long," making it "more difficult to manage and probably in some ways more of a test for CCGA." Still, it is "going along pretty good," he said.
?It doesn?t mean everybody is going to pick all of their oranges when they want," he said.
Mr. Gargiulo stressed the importance of maintaining a quality image for the "Sunkist? brand. Quality is a key principle on which Sunkist needs to focus, he said. "I know that we have good quality a lot of the time. But we have not-so-good quality some of the time."
He told both growers and packers that they are responsible to assure that the quality going in the "Sunkist? brand meets the quality standards customers and consumers expect. Among other things, that means the right varieties harvested at the right time. "There is no entitlement out there," he told the growers. "If you are not growing the right fruit at the right time? or are not growing high-quality fruit, "you can?t blame Sunkist? for poor returns, he said, adding that "at the end of the day, every grower may not pick every orange he has on his tree."
The growers and packers "that are going to be around in 10 years are the ones that can produce quality," he said.
?If you think you are going to be able to produce the wrong variety at the wrong time and then put pressure on a packer to pick the oranges and get them off quickly so everybody forgets about them, those days are over," he said. In the "long term," putting inferior quality fruit on the market "isn?t going to happen. If you are going to be in a branded program like we?ve got at Sunkist, you?ve got to have quality."
The "extortion of packers? by growers who insist that their oranges must be picked, packed and sold by a certain date "or I'm gong somewhere else? is "not going to work forever," he said.
He also urged packers to "push back on growers that are making unreasonable demands or have inferior or poor quality."
Another consumer expectation from a brand such as "Sunkist? is a high standard of food safety, Mr. Gargiulo said. "We?ve got to be at industry standards or above as it relates to food safety. That doesn?t mean we are going to say Sunkist oranges are safer than somebody else?s. I don?t believe in that. That?s a bad thing. But it has to be embedded in our brand promise that our standards are high. " We have to continue doing the things we are? with regard to food safety.
Speaking to more than 800 growers attending the citrus cooperative?s 111th annual meeting here on Wednesday, Feb. 16, Mr. Gargiulo and Sunkist Chairman David Krause, president of Paramount Citrus Association in Delano, CA, outlined several key building blocks to improved grower returns. Among them were industry unity, Sunkist leadership, the "Sunkist? brand and maintaining high quality standards.
Prior to last year, the industry had suffered several years of very poor returns. But last year, "net on-tree returns jumped dramatically, reaching profitable levels over cultural costs," said Mr. Krause. "In 2005, year-to-date performance continues to show positive results from the previous year."
While several factors have contributed to that, including the ability of the recently formed California Citrus Growers Association to manage supplies, Mr. Gargiulo stated that "Mother Nature had a big hand? in last year?s profitable season. "Last year, the [Navel] crop was good quality, not too big a quantity, good size structure and one that lasted a while. It was a good crop to sell."
That was helped by CCGA managing the supply to assure "consistent supplies in the market and in the stores of high-quality fruit on a weekly basis." That is good for customers, good for consumers and good for grower returns, he said.
This year?s Navel crop is more challenging, Mr. Gargiulo said. "We?ve got a much more difficult crop in oranges." Sizes are larger, and "there are more of them. They aren?t as pretty. The weather hasn?t cooperated." There have been some freezes and "a lot of rain," and the fruit will not "last as long," making it "more difficult to manage and probably in some ways more of a test for CCGA." Still, it is "going along pretty good," he said.
?It doesn?t mean everybody is going to pick all of their oranges when they want," he said.
Mr. Gargiulo stressed the importance of maintaining a quality image for the "Sunkist? brand. Quality is a key principle on which Sunkist needs to focus, he said. "I know that we have good quality a lot of the time. But we have not-so-good quality some of the time."
He told both growers and packers that they are responsible to assure that the quality going in the "Sunkist? brand meets the quality standards customers and consumers expect. Among other things, that means the right varieties harvested at the right time. "There is no entitlement out there," he told the growers. "If you are not growing the right fruit at the right time? or are not growing high-quality fruit, "you can?t blame Sunkist? for poor returns, he said, adding that "at the end of the day, every grower may not pick every orange he has on his tree."
The growers and packers "that are going to be around in 10 years are the ones that can produce quality," he said.
?If you think you are going to be able to produce the wrong variety at the wrong time and then put pressure on a packer to pick the oranges and get them off quickly so everybody forgets about them, those days are over," he said. In the "long term," putting inferior quality fruit on the market "isn?t going to happen. If you are going to be in a branded program like we?ve got at Sunkist, you?ve got to have quality."
The "extortion of packers? by growers who insist that their oranges must be picked, packed and sold by a certain date "or I'm gong somewhere else? is "not going to work forever," he said.
He also urged packers to "push back on growers that are making unreasonable demands or have inferior or poor quality."
Another consumer expectation from a brand such as "Sunkist? is a high standard of food safety, Mr. Gargiulo said. "We?ve got to be at industry standards or above as it relates to food safety. That doesn?t mean we are going to say Sunkist oranges are safer than somebody else?s. I don?t believe in that. That?s a bad thing. But it has to be embedded in our brand promise that our standards are high. " We have to continue doing the things we are? with regard to food safety.
