Visions - Summer 2017 - 6

CONTINUED

* 17 source countries
* Sales on three different continents
* Dublin, Ireland - Corporate HQ
* Rotterdam, Netherlands Logistics HQ

"Because of the perishability of the banana, there
cannot be inventory," explained Eguchi. "We have
to sell all of it. The Japanese produce shoppers buy
today what they will eat today or tomorrow. Everything is now. Whatever is in season gets on the shelf
in a Japanese supermarket. If the strawberries are late,
or the oranges aren't tasting as sweet, another fruit
moves to front and center, and often that is bananas.
It's been that way for decades in Japan. Because of the
seasonality of other fruits, we get a place on the shelf
that never experiences a downtime but suffered the
peaks and valleys, but soon we were able to secure
the center and stable shelf space through merchandising and marketing."
Eguchi predicts that with the Fyffes acquisition,
Sumitomo is looking at a yearly shipment of bananas
growing as high as 100 million boxes* to worldwide
markets, looking to the US market (250 million
boxes) and the European market (350 million) in the
next several years (*box = 40 pounds).
"Our dream was to compete in the major leagues,
which means competing against Dole, Del Monte and
Chiquita.We found Fyffes took the #4 position, and
most people hadn't heard of this company. Part of the
attraction was their family-run status as well as their
6

visions

Summer

2017

shipping logistics. Most bananas from the top three
companies are shipped on boats that those companies
own, and anyone else looking to ship had to use their
boats too. Fyffes was the leader in converting to specific containers, allowing service to a wide selection of
loading and discharging destinations."
Generally, large companies stay away from the farming aspect of agricultural business because of the volatility in its nature, but Eguchi said Fyffes proved to be
the perfect match by combining Sumitomo's farming
and merchandising experience in the produce sector
and Fyffes' worldwide distribution platform.
"Fyffes showed itself to be a great business to acquire in varying aspects, from their European market
position as the number one distributor of bananas,
to their measured expansion & solid market share in
melons, pineapples and mushrooms in North America." Eguchi said.
"We plan to invest in farms, market infrastructure,
merchandising and marketing - basically what Sumitomo did in Asia to expand its market share and
profitability. We need to expand the plantations. We
are growing both vertically and horizontally in our
expansion, and the sky's the limit on how big we can
grow."

Table of Contents for the Digital Edition of Visions - Summer 2017