Business Stratogy S ries

ISSN 1751-5637

Volume 11 Number 1 2010

Business Stratogy S ries ?CI 0 formerly Handbook of Business Strategy

massentra

---IE•111111111 ZE

sonaniiiin• M MMMM SIM 11•111111111111111W6CMPSIIIII

Emerald

E

3usiness Strategy Series Statement of mission

EDITORIAL ADVISORY BOARD

To provide CEOs, Directors and Senior Executives with a hands-on resource that can be used throughout the year to develop implementable, sustainable strategies.

Russell L. Ackoff Anheuser-Busch Professor Emeritus of Management Science, The Wharton School of the University of Pennsylvania, USA E-mail [email protected] Alberto Carneiro Director, Department of Sciences and Technologies, Autonomous University of Lisbon, Portugal E-mail [email protected] Jonathan Groucutt Business School, Oxford Brookes University, UK E-mail [email protected] William E. Halal Professor of Management, George Washington University, Washington, DC, USA Website http://home.gwu.edu/—halal Mitsuru Kodama Professor, Department of Management, College of Commerce and Graduate School of Business Administration, Nihon University, Tokyo, Japan E-mail [email protected] Bernard Marr Chief Executive and Director of Research, Advanced Performance Institute, UK E-mail [email protected] Richard Pech Director of Postgraduate Research, Graduate School of Management, Faculty of Law and Management, La Trobe University, Australia E-mail [email protected] Professor Rajesh K. Pillania, PhD Management Development Institute, Gurgaon, India Bonnie Richley Lecturer, Weatherhead School of Management, Case Western Reserve University, Cleveland, OH, USA E-mail [email protected] Paul Rogers Director, Bain & Company Inc., UK E-mail [email protected]

EDITOR Dr Alfred Lewis E-mail [email protected] [email protected] ASSOCIATE EDITOR Andreas Hinterhuber PUBLISHER Ruth Young E-mail [email protected] ASSISTANT PUBLISHER Sarah Roughley E-mail sroughley@emeraldi nsight.com ISSN 1751-5637 © 2010 Emerald Group Publishing Limited

Emerald Group Publishing Limited Howard House, Wagon Lane, Bingley BD16 1WA, United Kingdom Tel +44 (0) 1274 777700; Fax +44 (0) 1274 785201 E-mail [email protected] For more information about Emerald's regional offices please go to http://info.emeraldinsight.com/aboutJoffices.htm Customer helpdesk: Tel +44 (0) 1274 785278; Fax +44 (0) 1274 785201; E-mail [email protected] Web www.emeraldinsight.com/customercharter Orders, subscription and missing claims enquiries: E-mail [email protected] Tel +44 (0) 1274 777700; Fax +44 (0) 1274 785201 Missing issue claims will be fulfilled if claimed within six months of date of despatch. Maximum of one claim per issue. Hard copy print backsets, back volumes and back issues of volumes prior to the current and previous year can be ordered from Periodical Service Company. Tel +1 518 537 4700; E-mail [email protected] For further information go to www.periodicals.com/ emerald.html Reprints and permission service For reprint and permission options please see the abstract page of the specific article in question on the Emerald web site (www.emeraldinsight.com ), and then click on the Reprints and permissions link. Or contact: Copyright Clearance Center- Rightslink Tel +1 877/622-5543 (toll free) or 978/777-9929 E-mail [email protected] Web www.copyright.com No part of this journal may be reproduced, stored in a retrieval system, transmitted in any form or by any means electronic, mechanical, photocopying, recording or otherwise without either the prior written permission of the publisher or a licence permitting restricted copying issued in the UK by The Copyright Licensing Agency and in the USA by The Copyright Clearance Center. No responsibility is accepted for the accuracy of information contained in the text, illustrations or advertisements. The opinions expressed in the articles are not necessarily those of the Editor or the publisher. Emerald is a trading name of Emerald Group Publishing Limited Printed by TPF Digital, Lexicon House, Middleton Industrial Estate, Middleton Road, Guildford GU2 8XP

g 0.% sio

643

FSC Mixed Sources

Business Strategy Series is indexed and abstracted in: Inspec OCLC

C.f.. number

tl

Product group from well-managed forests and recycled wood or fiber Con no. SA-CO61586 wwwfse.org a vise forest sterrartbnip condi

INVESTOR IN PEOPLE

VIM

Emerald Group Publishing Limited, Howard House, Environmental Management System has been certified by ISOQAR to IS014001:2004 standards

Gott.. rmba.

1986

Awarded in recognition of Emerald's production department's adherence to quality systems and processes when preparing scholarly journals for print

Table of contents Volume 11 Number 1 2010

Feature articles Access this journal online Note from the publisher

2 71

Examining market accessibility of Malaysia's Harumanis mango in Japan: challenges and potentials Rosidah Musa, Faridah Hassan, Jamaliah Mohd Yusof and Norzaidi Mohd Daud

3

Multinationals' sins pave the way to the expansion of domestic companies Slawomir Wycislak

13

Towards successful knowledge management: people development approach Abbas Monawarian and Zahra Khamda

20

Diverging responsibilities: reflections on emerging issues of responsibility in the advertising business Nando Malmelin

43

Measurement of knowledge management maturity level within organizations Neda Khatibian, Tahmoores Hasan gholoi pour and Hasan Abedi Jafari

54

Assoc. Prof. Dr Rosidah Musa Head of Publication Institute of Business Excellence Level 3, FBM Building, Universiti Teknologi Mara 40450 Shah Alam

New for 2010

CO PE

E0111171Et ON

FIRM

This journal is a member of and subscribes to the principles of the Committee on Publication Ethics

■ As part of Emerald's commitment to highlighting the impact of research, authors will, from this volume, be able to flag up implications for research, practice and/or society. Our structured abstracts format aims to pinpoint further for the reader the utility of the research in question. ■ Graphics supplied in colour will be reproduced in colour to enhance their appearance in the online version of the article. The hard copy will continue to be reproduced in black and white.

Emerald

NNW

VOL. 11 NO. 1 2010, ( Emerald Group Publishing Limited, ISSN 1751 - 5637

BUSINESS STRATEGY SERIES

PAGE 1

Examining market accessibility of Malaysia’s Harumanis mango in Japan: challenges and potentials Rosidah Musa, Faridah Hassan, Jamaliah Mohd Yusof and Norzaidi Mohd Daud

Rosidah Musa is Associate Professor and Jamaliah Mohd Yusof is a Lecturer, both based in the Faculty of Business Management, Universiti Teknologi Mara, Selangor, Malaysia. Faridah Hassan is Director at the Institute of Business Excellence, Faculty of Business Management, Universiti Teknologi Mara, Selangor, Malaysia. Norzaidi Mohd Daud is Head of Corporate Com., Publication and Database, Malaysia Institute of Transport, Universiti Teknologi Mara, Selangor, Malaysia.

Introduction The agriculture sector has contributed significantly to the growth and development of the Malaysian economy hence, it is appropriate for the agriculture and food sector to be recognized as the third engine of Malaysia’s economic growth. Malaysia’s quest to be a major net exporter of food by 2010 is supported by the mandate to reinvent the agriculture sector. To ensure that this sector’s contribution to the national economy and its global competitiveness remain strong in future, the Third National Agricultural Policy (NAP3) has been formulated. The NAP3 covers the period 1998 to 2010, which was set out as a framework for the agricultural sector future growth and continue to sustain as an important sector in the economic development of the country. The Policy was largely guided by the objectives and strategies of the National Development Policy and incorporates several strategies and action plans to deal with expected challenges and changes to the international economy. It was reported that the markets for agricultural produce such as local fruits are experiencing an intensive competitive environment domestically, particularly during the fruit season. As such, it is envisaged that developing new markets, for example, penetrating challenging markets such as Japan for fruits could represent a significant contribution of the agricultural sector to export earnings. This effort could facilitate and support the country’s goal of increasing its agricultural products export value to RM17.2 billion by 2010 (Federal Agricultural Marketing Authority, 2005). Malaysia is a producer of a wide range of tropical fruits such as pineapple, banana, mango, rambutan, durian, mangosteen, jack fruit, star fruit, just to name a few. Although the world market for tropical fruits is growing, Malaysia’s share in the overall international fruit trade is relatively insignificant. Nonetheless, some interesting prospects for future development of tropical fruits in Japan have been identified (Miyauchi and Perry, 1999). Hence, it is timely for Malaysia to examine the export market potential for its fresh tropical fruits, particularly Harumanis mango into the Japanese market. Furthermore, it is important to note that Malaysia and Japan have a Government to Government agreement on exporting Harumanis, which is a special variety of mangoes specifically requested by Japan. Harumanis is considered the ‘‘King of Mangoes’’ and is very popular in Malaysia because of its deliciousness, sweet and aromatic fragrance. Hence, the exporting of Harumanis mango could act as the gateway for other Malaysian fruits to penetrate the Japanese market. Currently, Malaysian fresh fruits are still prohibited for export into Japan. Japan is considered one of the largest markets in the world. Being the world’s biggest importer for primary produce such as rice, wheat, soy bean, beef, fish, prawn, and animal feed (Miyauchi and Perry, 1999), its market for fresh fruit is relatively undeveloped. Furthermore, it was reported that the Japanese fruit growers satisfied only 60 percent of the market demand (Japan Trade Directory, 2005). Thus Japan offers a promising opportunity for foreign importers.

DOI 10.1108/17515631011013078

VOL. 11 NO. 1 2010, pp. 3-12, Q Emerald Group Publishing Limited, ISSN 1751-5637

j

BUSINESS STRATEGY SERIES

j

PAGE 3

Japan itself produces fresh fruits such as pears and persimmon for domestic consumption. Based on economic data, Japan is the third major producer of persimmon after China and Brazil (Japan Trade Directory, 2005). A wide variety of fresh fruits are imported to Japan, and the most common are bananas, pineapples, oranges, grapefruits and mangoes. With a strong economic background of Japanese households, the demand for other fresh fruits keeps on increasing (Japan Trade Directory, 2005). It was noted by Miyauchi and Perry (1999), that the volume of the imported fruits is declining, but the variety of imported fruits and consumption of new and foreign tropical fruit is increasing. This reflects the Japanese consumers’ desire for variety in the fresh fruits category. With regard to fresh fruits imports, among the major exporters are the USA, for oranges, grapefruits, lemons and limes and papayas; New Zealand is the key exporter for kiwifruits and Philippines is the major exporter for bananas, pineapples and mangoes (Japan Trade Directory, 2005). The domestic production has run at 3.0-3.2 million tons a year whilst imports’ share of total fresh fruit supply is approximately 35 percent, about 1.6 million tons (see Japan Trade Directory, 2005). Even though it is an attractive avenue to embark on export marketing specifically to lucrative markets such as Japan, yet a tremendous amount of effort, time and money has to be invested to fully understand the market and ultimately gain market accessibility. Therefore, a detailed knowledge of the importing regulations and procedures, the Japanese distribution system, business practices and the Japanese fruit consumption behaviour is imperative in order to gain market accessibility. Importers might face a tremendous challenge as the Japanese market is very different in terms of plant protections laws, distribution system and the Japanese fruit consumption is much different from other cultures. Despite these issues, surprisingly very little research has been carried out to enrich our insights on the knowledge gap. In response to this void, this paper attempts to study the critical challenges and potential of exporting fresh mangoes into the Japanese market. Thus, the aim of this study is to explore and identify the challenges and potentials in exporting Harumanis mangoes to the Japanese market. Specifically, the research aims to gain insights into the legal regulations and administrative procedures of importing tropical fresh fruits as well as to understand the Japanese distribution system of fresh fruits and business practices and the Japanese fruit consumption behaviour. Research design A two-stage approach was used in this study. First, focus group discussion was conducted in Malaysia with relevant exporters, agents, representatives from the Ministry of Agriculture and Agro-based Industry, Federal Agriculture Marketing Authority (FAMA) and the Japanese Embassy. The main objective of the focus group session was to understand the current rules and regulations in importing fresh fruits to Japan and to gain some insights from panels that have vast experience in exporting fresh fruits to Japan. Second, several in-depth interviews were conducted in Japan with relevant key officers of various fruit-related organisations such as the Import Promotion Department of the Japanese External Trade Organization (1998) (JETRO), the import agents and wholesaler of fresh fruits and also Fresh Produce Import Facilitation Association in Japan. Furthermore, relevant information was also obtained from official reports published in Japan and Malaysia and observations from field visits. The in-depth interviews with the Japanese authorities were conducted during 7-19 October 2006 in various cities in Japan which include Osaka, Nagoya, and Tokyo. In addition, the research members visited several hypermarkets and supermarkets in these cities to observe the fresh fruits available with regard to varieties, prices, quality, packaging, and their country of origin. Meetings with the relevant companies’ top management and top officials of Tottori University and Wakayama University in Osaka were arranged by our research associates in Japan. Company representatives from Nagoya came to Tokyo to be interviewed. Three consumer surveys were conducted in Tottori and Wakayama University and Japanese Club, in Kuala Lumpur. The interviews were conducted between 10 and 19 October 2006 in three major cities in Osaka, Nagoya, and Tokyo. On 10 October, an interview was held in Wakayama University in Osaka with the President, Vice President and also other top management of the University. On 11-12 October, 2006, the researchers attended a seminar on agriculture organised by Tottori University. Most of the papers presented were mainly about the demand and supply

j

j

PAGE 4 BUSINESS STRATEGY SERIES VOL. 11 NO. 1 2010

of fresh fruits in the Japanese market. During the seminar, our research team distributed structured questionnaires to the students and lecturers who attend this seminar. The main purpose of this survey was to explore the preferences and awareness of Japanese consumers of Malaysian’s tropical fruits. While in Tottori we were also invited to attend a meeting organised by Japanese Agriculture Association (JAA). We took this opportunity to interview the officers about the potential of exporting Malaysian’s fruits in the Japanese market. We were also furnished with important reports pertaining to the value of export and imported fruits in Japan. Subsequently, after the meeting we were invited to visit the pear plantation. Tottori is well known as the biggest producer of quality pears in Japan. We were also given the opportunity to visit JAA biggest fruit collection centre, where the key workers are the nashi (pear) farmers themselves. We were amazed by the high technology instruments that the factory employed in order to grade and pack the fruits. On 14 October, the researchers travelled southbound to Toyokawa, Nagoya where a meeting was conducted with the packaging manufacturer. During the visit we were given the opportunity to witness the latest packaging material and technology used by the factory. In Tokyo, we met with distributors, trading companies, importers, executives of Jusco, Japan Fresh Produce Import and Safety Association, Ministry of Agriculture, Forestry and Fisheries, Japan External Trade Organization, the OTA Fruit Auction Market and also the fruits parlour. Research findings It was reported that most of the fruits import source is from the USA which constitutes about 30 percent of the total imports. In 2004, Malaysia took 21st place in terms of ranking for importing the fresh fruits into Japan. The sales volume for the tropical fruits has been about 2 million yen per year (Japan Trade Directory, 2005) It was also stated that the opportunities for exporters to import the fresh fruits into Japan are great if they could produce good quality fruits. It was revealed that most of the foreign fruits are imported by traders. In May 2006, the Japanese government imposed stringent regulations on the suppliers of imported fresh fruits into Japan. The chemical content of the fruits has to be reported in order to check against the Japanese positive chemical listing. Owing to this stringent ‘‘traceability’’ protocol Japan was able to detect traces of prohibited pesticides in the fresh fruits, particularly mangos from India. The fruit importers assert that it is particularly very difficult to import fresh fruits to Japan. There are only a few suppliers or traders who are able to import the fresh fruits. The critical issue of importing fresh fruits has been quality and also the presence of fruit fly. For instance, the importing agents had unpleasant experiences when importing mangosteen from Thailand. For this reason they import other fruits instead, such as mango originating from India. As such, this switch increased the level of competition among fresh mango sellers, given that the fruit was already available in the Japanese market. It was observed that only those traders who adhere strictly to the rules and regulation of importing foreign fruits would be able to supply the fresh fruits to Japan. As a result of a discussion with the leading supermarket key executives in Japan, it was unveiled that customers generally enjoy eating fresh fruits, but they dislike peeling off the skin. As such, this segment of consumers prefers to consume processed fruits such as pudding and juices. In addition, the supermarkets were facing problems on their imported fruits such as black spots typically found on most of the fruits. Apart from this, they also encountered a delivery period issue where most traders could not comply with the earlier agreement on delivery date(s). It is thus crucial that the fruits must be delivered as per agreement in order to maintain their freshness and sweetness. Among the popular fresh fruits imported by the supermarkets are papaya, mangosteen, and durian. Mangoes are regarded as the next popular fruits sold by the supermarkets. Looking into the possibilities of exporting the tropical fresh fruits into Japan, the importers emphasised the import quarantine procedure (see Appendix 1 (Figure A1). In such a case, the exporters have to establish a protection method where the fruits have to be frozen at 2 17.8C or have to undergo vapour heat treatment (VHT-fumigation method) in order to eliminate fruit flies. The requirement for the VHT was also discussed and it was noted that different fruits would require different level of temperature for the heating treatment. Thus, it

j

j

VOL. 11 NO. 1 2010 BUSINESS STRATEGY SERIES PAGE 5

is advisable for the exporters to focus on one fruit only if they would like to export into Japan and apparently, this is more cost effective. The Association of the importers highlighted on the importance and requirement of the import quarantine procedures by Japan. In such a case, countries who would like to import their fruits into Japan have to develop a quarantine method to protect the fruits. So far, among the Asian countries, Thailand was successful after they developed the quarantine method and technology that is required by Japan. The diagram of import quarantine procedures is depicted in Appendix 1 (Figure A1). Currently, Japan is importing about 12,000 tons of mangoes annually from many different countries. For the past three years, the importation of mango has increased in volume, which suggests that demand continues to grow steadily. However, it was highlighted that if Malaysia is to import their fresh fruits into Japan, they have to abide with the positive list to trace the chemical residue of the fruits. From our meeting with the fruit wholesalers, it was mentioned that they mostly handle the local fruits. Imported fruits such as banana and pineapples from Philippines, grapefruits from USA and South Africa, oranges from USA, kiwi from New Zealand and avocado from Mexico are also imported and distributed by the wholesalers. Fruits are used as a gift by the Japanese consumers besides being consumed as a dessert. In Tokyo, they also have an opportunity to eat the fresh fruits in a more luxurious way such as the fruit parlour. The fruit parlour serves only the best quality fruits. Interestingly, the fruits are displayed in very attractive packaging. They are either consumed in the parlour itself or purchased as gifts.

Conclusion and recommendations Challenges Japan has very stringent procedures for importation of fresh fruits, such as the Plant Protection Law and the Food Sanitation Law. The Japanese quarantine system for imported plants consists of prohibition of import, designation of port of import, phytosanitary certificates issued by the exporting countries and import inspection. Under the Plant Protection Law, any importer of fresh fruits shall submit an ‘‘Application for Inspection of Plants and Import Prohibited Articles’’ to designated port of entry. In addition, ‘‘Phytosanitary Certificate’’ must be issued by reliable and competent government agency of the exporting country and attached to all quarantine-designated plants. Imports of host fresh fruits are prohibited from countries or areas where certain destructive insects and diseases and areas where fruit flies are commonly found. Owing to such stringent compliance procedures, very few suppliers or exporters are able to import their fresh fruits into Japan. In most cases, more than 90 percent of any fresh fruit comes from a single country or region (Japan Trade Directory, 2005). Malaysia has applied for the lifting of the ban on its special mango variety (Harumanis) via Government to Government Trade Agreement,. The procedure for lifting the ban is composed of 13 steps as depicted in Appendix 2 (Figure A2). Starting from May 2006, the Japanese government has imposed new regulations on potential exporters to Japan. There are many fresh fruits which are prohibited for importation to Japan under the Plant Protection Law. This law requires the fruits to be frozen at 2 17.8C or these fruits have to undergo the vapour heat treatment (VHT). The reason for the treatment is to eliminate fruit flies which could damage the quality of the fruits. Different fruits would require different temperature for the vapour heating treatment. It is advisable for the exporters to apply for lifting of the ban for one fruit initially as a gateway to other fruits into Japan (see Appendix 2, Figure A2). This is because it is more cost effective in order to deal with the stringent importation protocol. Another challenge facing the exporters is in terms of the price. Since there are so many exporters from many different countries competing to penetrate the Japanese market, price becomes a critical issue. It is pertinent for fruit exporters to carefully and clearly position their fruits in terms of uniqueness and nutritious value in order to compete and establish a position against tropical fruits from other countries. Japanese consumers’ emphasis on quality can be observed in the selection of fruits. The fruit quality in the Japanese market is defined by four main characteristics which are:

j

j


1. Fruit colour and appearance. The appearance of fruits is one indicator to determine the fruit extrinsic quality. For instance, the colour of the mango skin should be yellowish, slightly orangey or reddish. However, Harumanis is yellowish green, which is quite similar to American mangoes. More importantly, the mangoes’ skin must be free from any scratch, blemish or black spots. The imperfections on the fruit skin indicate that the fruit is damaged and regarded as low quality. 2. Fruit taste. Fruit which are of higher brix (greater than 15) is regarded as of higher quality and most preferred by the Japanese. 3. Fruit size. Mangoes should weigh about 300-400 grams per fruit. Consistency of the fruit size is important; particularly if the fruits are to be marketed in a supermarket and prestigious gift shop. 4. Health and safety. Information pertaining to nutritious value of the fruit must be comprehensively reported. The Japanese are very concerned about the nutrition content of fruits as they are a very health conscious society. It is well recognized that the Japanese are very particular about fruit presentation; therefore in order to be successful in this market fruits must be packaged in an attractive and effective packaging. Quality packaging must successfully address the three P’s of packaging: pleasing, practical and protective. The packaging for Harumanis should assure maximum protection for the fruit, transport the fruit in the most freight-efficient manner and also be able to achieve high impact merchandising appeal at the retail level. Undeniably, packaging appears to be an investment to build a favourable image for the fruit as well as a means for differentiation. Importantly, Japanese importers are very concerned about the exporters’ ability in supplying the mangoes in a consistent manner to fulfil the market demand. In this matter, production of fruits must be adequate to meet the market demand. Perlis Department of Agriculture has been identified as the government institution that is responsible to focus on Harumanis plantation to yield a better quality of mangoes and to increase the acreage of plantation. MARDI has been actively involved in research to improve the yield of the fruit and eradicate the fungus-related problem. Even though it was acknowledged that Harumanis is the ‘‘King of Mangoes’’, it is not without problems. Harumanis is susceptible to fungus, fruit flies and pest attack. Moreover, Harumanis has a lower fruit yield compared with other mango varieties. Furthermore, plantation and maintenance of Harumanis mangoes are more costly than for other varieties. Undoubtedly, farmers prefer to plant other mango varieties. However, farmers are willing to transform the present concentration on the plantation of other mango varieties to Harumanis if the income derived from exporting to the Japanese market is better. Potentials Japan’s population of 127.8 million is considered wealthier and larger than those of other countries. Japan is the world’s second largest market economy after the USA and furthermore, represents one of the most important markets for many fruit exporters around the world (Shim et al., 2001). Over 95 percent of total import volume of fresh fruit to Japan comprises five fruits – pineapples, bananas, lemons, oranges, and grapefruit (Japan Trade Directory, 2005). It was reported that the volume of these fruits is declining. However, the variety of imported fruits and consumption of new and foreign tropical fruit is increasing (Miyauchi and Perry, 1999). This reflects that the Japanese consumers desire new variety or higher quality fruits in the fresh fruits category, while some are looking for unique tropical and exotic foreign fruit such as mangoes. Previous research revealed that the deterrent factors related to the purchase of mangoes in Japan are due to ‘‘unavailability’’ and ‘‘lack of knowledge’’ (Miyauchi and Perry, 1999). However, during our field visit in Japan (June 2007), it was observed that mangoes have become one of the most popular fruits in Japan (Figure 1 and Table I). Fresh fruits are not only an important part of the Japanese diet, but more importantly, fruit consumption is associated with its social and cultural practices. For instance, fruit is considered a luxury item and thus plays an important and elaborate ritual part in Japan’s extensive gift-giving practices (Shim et al., 2001). Indeed, fruit competes not with vegetables but with high-price gift items or sweets and snacks (Gehrt and Shim, 1998). With a strong economic background of individual households, the demand for other fresh fruits is expected to steadily increase.

j

j


Figure 1 The mango trend in the Japanese market

Table I Mango in the Japanese market 2004 share %

2004 Philippines Mexico Thailand Taiwan Australia USA Brazil India Total

7,303.335 2,908.254 900,803 504,820 474,909 243,836

12,335,957

59.20 23.58 7.30 4.09 3.85 1.98 0.0 100

2005 6,274,329 3,586,593 955,195 475,591 342,837 253,460 249,968 12,137,973

2005 share % 51.69 29.55 7.8 3.92 2.82 2.09 2.06 100

Growth rate % 86 123 106 94 72 104

98

2006

2006 share %

Growth rate %

5,443,485 4,333,814 1,098,636 444,233 338,030 316,756 403,039 8,776 12,386,769

43.9 34.99 8.87 3.59 2.73 2.56 3.25 0.07 100

86 120.8 115.0 93.4 98.6 125.0 161.2 102.0

The Japanese consumers are generally not price sensitive in their consumption of fresh fruits and are apparently willing to pay a premium price for fruit (Shim et al., 2001), making it attractive to Malaysian exporters. This will only be realised if potential exporters understand the Japanese consumer’s unique fruit consumption orientation, such as concern for product safety and aesthetics. It should be noted that Japanese consumers are conscious about brands and thus brands play an important role in their shopping orientation. Strong brand recognition of local produce is likely to be a significant key to global market. In this respect, the Ministry of Agriculture and Agro-based Industry has introduced the ‘‘Malaysia Best’’ logo. Notably, Dole has successfully captured and established its brand in Japan. It should be highlighted that, if the fruits cannot be imported fresh, another option is to import them as processed fruits, such as juice, jam, dried fruit or frozen fruit. Besides the fresh fruits, the processed fresh-fruit based is also gaining in popularity. Among the popular ones are the mango pudding and also fruit juice. However, it must be emphasised that the taste of

j

j


frozen fruits is significantly different from fresh fruits and the fresh fruits are more nutritious, juicy and sweeter. It was recognised that Harumanis mangoes have great potential to succeed in the Japanese market. From our field observation and consumer acceptance survey, it was unveiled that the Japanese have very favourable attitude towards mango and most likely will purchase it whenever available in the market. Furthermore, it was also rated as the most favourite tropical fruit when compared against mangosteen, rambutan, durian, star fruit and jack fruit. Perhaps mango possesses the fruit attributes that match the Japanese taste preference which are sweet and juicy. Based on the feedback from one of the leading importer of fresh fruits in Japan, Harumanis is positioned within the quadrant of delicious and expensive (see Figure 2).

Figure 2 Positioning map of Malaysian mangoes in the Japanese market

Figure 3 Mango calendar in Japan

j

j


In conclusion, Harumanis has a good chance to succeed in the Japanese market if the fruit is exported at the right time (see Figure 3), at the right price and employs effective promotional strategies. We envisage that Harumanis mango will lead the way to be marketed in the Japanese market as a premium mango.

References Gehrt, K.C. and Shim, S. (1998), ‘‘The role of fruit in the Japanese gift market: situationally defined market’’, Agribusiness, Vol. 14 No. 5, pp. 389-402. Japan Trade Directory (2005), ‘‘Bibliography on rules and regulations’’, Japan Trade Directory, Yamazaki. Japanese External Trade Organization (1998), Marketing Guidebook for Major Imported Products, Japanese External Trade Organization, Tokyo. Miyauchi, Y. and Perry, C. (1999), ‘‘Marketing fresh fruit to Japanese consumers: exploring issues for Australian exporters’’, European Journal of Marketing, Vol. 33 No. 1/2, pp. 196-214. Shim, S., Gehrt, K. and Lotz, S. (2001), ‘‘Export implications for the Japanese fruit market: fruit-specific lifestyle segments’’, International Journal of Retail & Distribution Management, Vol. 29 No. 6, pp. 300-16.

Further reading AgExporter (1995), ‘‘Quality is key to Japan’s fruit, vegetable market’’, March. International Plant Protection Convention (1977), International Plant Protection Convention (new revised text), November. Matsuda, T. (2006), ‘‘Consumer demand for fresh fruits in Japan’’, Tottori University, Tottori. www.famaExchange.org (2006), available at: www.famaExchange.org (accessed 10 July 2006).

Appendix 1 Figure A1 Import quarantine procedure

j

j


Appendix 2 Figure A2 Procedures for lifting the ban on importation

j

j


About the authors Rosidah Musa is an Associate Professor in the Faculty of Business Management, Shah Alam, Malaysia. She received her PhD in Marketing from Cardiff University, UK. Her research interests include marketing and branding. To date, her research work has appeared in international journals as well as conference proceedings. Faridah Hassan is a Professor in Strategic Management and the Director of Institute of Business Excellence, Universiti Teknologi MARA, Shah Alam, Malaysia. She received her PhD from Universiti Sains Malaysia and her research interests include marketing and strategic management. She has published more than 20 papers in international journals as well as conference proceedings. Jamaliah Mohd Yusof is a PhD candidate at Graduate Business School, Universiti Teknologi MARA, Shah Alam, Selangor. Her research interests include marketing and branding. Her work has been published in chapters in a few books, international journals and conference proceedings. Norzaidi Mohd Daud is an Associate Professor in Management and the Senior Research Fellow at Malaysia Institute of Transport (MiTrans), Universiti Teknologi MARA, Shah Alam, Malaysia. He received his PhD from Multimedia University and his research interests include marketing, management and statistics which won him more than 40 awards at national and international levels. He has published ten books and more than 30 articles in international journals (IMDS, Humanomics, AP, CWIS, MPM, IJSS, IJBSR, JCIS, IJEF, IJMIE, IMCS, IJIL etc.) and conference proceedings. Norzaidi Mohd Daud is the corresponding author and can be contacted at: [email protected]

To purchase reprints of this article please e-mail: [email protected] Or visit our web site for further details: www.emeraldinsight.com/reprints

j

j
