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Packaging options pay off for KIKU® brand apples

As the KIKU® apple becomes increasingly popular among US buyers, one supplier says that diverse packaging has been integral to the variety’s success.

“Each customer seems to want their own kind of package,” says John Rice, of Rice Fruit Company. Rice Fruit Company, one of three licensed American KIKU® suppliers, sells KIKU® brand apples using a range of packaging options that include traditional tray pack cartons, returnable plastic containers, display ready cartons, clamshell 12-packs, polyethylene bags, and paper tote bags. 

“Pouch” packaging performs well
The most recent addition to Rice’s list of packaging options is “pouch” bags, a style popularized with grapes and cherries over the past four years. “The great thing about it is the material they use is more sophisticated than old polyethylene bags,” says Rice, who explains that the plastic used in pouches is clearer, stiffer, and more durable than polyethylene. This makes product more attractive, reduces shrinkage due to bruising, and allows his company to print high quality graphics on the bags.

Premium varieties match well with new format
Rice Fruit Company first used pouch style bags in 2012 for its line of Honeycrisp apples. Rice’s company introduced pouch packaging to KIKU® brand apples in 2013. This was done in tandem with Columbia Marketing International, the first American company to licence the KIKU® brand and the brand’s principal partner, as well as Applewood Orchards, CMI’s other KIKU® sub-licensee. Rice says that the new format quickly proved popular with buyers. “What was once probably 10% of our sales is now about 30%.” Rice adds that pouch sales may increase further, as KIKU® pouch bags have recently been launched at Sam’s Club locations.

Pouch bag plastic costlier than polyethylene
While pouches have worked well for Rice Fruit Company’s premium varieties, Rice says that buyers are reticent to purchase pouch-packaged product when it comes to other varieties. “We’ve had a more difficult time getting our customers to adopt the pouch for other apples.” Rice says this is largely a cost consideration, as pouch plastic costs between two to four times as much as polyethylene. This adds an extra 10 cents per bag at most retail locations.

Packaging largely tailored to buyers
Unlike pouches, most of Rice Fruit’s other packaging strategies have come in response to requests from buyers themselves. Rice notes that his company first began using RPCs after a request from Walmart in 2005, and that its clamshell format was launched after a request from Costco in 2006. Meanwhile, Rice Fruit’s paper tote bags are sold to Whole Foods, whose customers prefer biodegradable materials.

Continued growth for brand
Despite this wide range of packaging options, Rice says that his company has worked hard with CMI and Applewood to develop a “uniform” identity for KIKU® brand apples. “Something that is relatively rare in the produce industry is strong brands, so we wanted to put a strong brand on this apple.” The strategy has paid off, as Rice says KIKU® sales have increased roughly 30% year over year since the apple’s introduction to the US market in 2011. Rice expects that growth to continue. “Next year we’re probably going to have to plant new trees.”

For more information:
John Rice
Rice Fruit Company
Tel: +1 (717) 677-8131

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