FRESNO, Calif. — Millennials just weren’t eating raisins. So Sun-Maid, the century-old company with the iconic little red raisin boxes, hired someone to convince them that they should.
He said that he asked the group how they thought they could work together. “And the answer I got back was nothing short of collusion,” he said. While no one was proposing they take action, the anti-competitive tactics discussed in that back room, he said, were “completely illegal.” What you heard through the grapevineIt makes sense that Sun-Maid and its competitors in the raisin sector, all working and living in the same water-hungry valley, might not be the best of friends. But the American raisin industry, which is estimated to be worth about US$500 million, is particularly fractious. Other groups of farmers also band together to set prices; while raisin growers do that, they do not tend to cooperate on much else.
Barry Kriebel “and I fought like cats and dogs,” said Kalem Barserian, 81, the leader of the Raisin Bargaining Association, which represents raisin farmers as they negotiate prices with raisin processors, including Sun-Maid. Raisin farming is risky. So, starting in the mid-20th century, raisin farmers began committing a significant share of their crop to a communal supply. This surplus was used to stabilize trade. Though raisin farmers do get paid for selling this supply, the money comes later, if at all.
Horne, who will turn 74 this year, knows he is not well-liked in raisin town, but he stands by his decision. “Those guys are still living in the old paradigm,” he said. View this post on Instagram Reach for the simple, healthy snack that’s loved by kids and grown-up kids alike.Why don’t millennials think of raisins while snacking? “It comes down to just a top-of-mind issue. They don’t think about it because there’s so many other things that they’ve got to choose from that are being thrown at them today,” he said.
He warned the Sun-Maid board as early as spring 2018 of that possibility. In September, negotiations with the association, and with Kalem Barserian, started in earnest. In 2017, raisins were damaged by extreme heat and in September, rain prevented them from drying properly in their vulnerable, wooden bins. This meant fewer raisins, which meant that raisins were naturally going to be more expensive.
Gossip and TensionsThe raisin industry runs on what Overly calls “coffee shoptalk,” which is to say, gossip. And the gossip was that Sun-Maid’s new chief executive didn’t want to pay a fair price to farmers. The negotiations between Sun-Maid and the RBA continued to go poorly. Nothing convinced Overly he should accept a second bid that lowered the price by US$100 and committed to a two-year price deal.
He also said: “I mean somebody might have threatened somebody. But that’s just the farm. … ” He trailed off. “At the time, it was like ‘Oh, OK, no problem,’” Overly said. But by the time of the event, it was “‘Oh my God, you’ve got the head of the RBA and the head of Sun-Maid are going to go head-to-head on a stage in front of 500 to 1,000 people.’”
We need to spend more time focusing on growing the pie than fighting over our piece of the pie within this industryHe spent about 25 minutes talking about the lasting quality of the California raisin and the need to defend its place in the global market. He talked about raising prices sustainably, and growing demand for the product. He said that it was market forces that compelled Sun-Maid’s decision to leave the RBA.
Phillips started his speech by saying that he had never been a Sun-Maid guy. But he agreed with Sun-Maid’s position. It was better to band together than stand apart. He turned to Barserian, the raisin titan. “Kalem, you don’t have a plan,” he said.Malcolm, who is an elder in the Mormon Church, would not share the recordings he took of the session, citing how rough the language was in the room.