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Uesugi Farms Inc. settled into its new cooler

by Joel Gebet | July 09, 2009
Pete Aiello remembers the first time he walked into Uesugi Farms Inc.'s then newly built, 5,400-square-foot cooler at its new facility in Gilroy, CA, in the mid-1990s.

"I remember walking in that cooler and wondering how we were going to grow enough stuff to actually fill it up because our original cooler in Morgan Hill, California, was only about 1,500 square feet," he told The Produce News. "Lo and behold, it didn't take long for it to be bursting at the seams."

Uesugi Farms recently replaced its second cooler with one that is five times the size, and Mr. Aiello could not be happier. "We moved in May, and it's been a godsend," he said.

Mr. Aiello, who serves as the family-owned-and-operated firm's general manager and secretary, said that his father, Joe, and his dad's former partner, Dennis Humphreys, bought the firm, which was originally founded in the 1950s by George Uesugi, a farmer in Morgan Hill, CA, in April 1979. They grew it into the success it has become.

"They started out at first with 15 acres, a couple of old beat-up trucks, a couple of old forklifts and tractors, and my dad and Dennis basically did everything themselves," he said. "My dad carved out a niche in the chili pepper deal, and at the same time, [continued] the two main commodities George grew: strawberries and Napa cabbage."

From those humble beginnings, the firm has grown to become a major grower-packer-shipper of bell peppers, chili peppers, Napa cabbage, bok choy, strawberries and pumpkins on 1,500 acres of its own land and another 3,000 contracted acres throughout California from May through December. It also uses another 700 acres in Sonora, Mexico, from November through June. "We've got an excellent group of growers, and we're really pleased to be partners with them. They've done a great job."

He said that the firm's chili deal has 15-20 varieties. "We offer all the ones you've heard of and some that you haven't. We have everything that you'll find on a grocery store shelf," he said.

Although it primarily grows its chilis for processing -- it is the exclusive supplier of "heatless" Jalape?os from California for Campbell's Soup Co.'s "Pace" label -- Mr. Aiello said, "Whenever [the] market is healthy to warrant packing fresh chilis, we have that flexibility. We can finesse a few acres for the fresh side until that deal has run its course."

He noted that when his father started the firm's chili deal, "They were a new phenomena in the eyes of Americans. A lot of folks in California, Arizona and New Mexico knew about them, but they were relatively untouched as far as the rest of the country was concerned."

He added, "The Santa Clara Valley was an up-and-coming spot for growing chili peppers," and at first, Uesugi Farms started selling to a handful of customers for processing.

The firm's chili pepper business started to take off in the mid-1980s. "Sales were growing very rapidly, we were taking on a lot of new customers," he said. The chili pepper deal was really the engine that drove the growth of the company through the '80s."

By end of the decade, the firm added the green bell pepper to its repertoire, and "that deal started to take off," he said. "We were selling all over the country to retailers, foodservice and wholesalers. That really diversified our fresh-market deal, and we started to get exposure on a national level due to bell peppers."

With business booming, the firm bought an 80-acre parcel in Gilroy in the mid-1990s and built a packingshed and cooler.

"We continued to grow the bell pepper program and added red and yellow to the greens," he said. "We were increasing acreage every year and added a pumpkin patch, and that really started taking off. Our revenues were growing steadily at 10-15 percent a year."

In 2004, Mr. Humphreys retired, and Pete Aiello, along with his brother Mike, purchased Mr. Humphreys' share of the firm's stock and became co-owners with their father. Pete took over Mr. Humphreys' sales job, and Mike became the production manager.

"We brought a young, fresh attitude and energy and started going after customers, growing the fresh-market program and focusing on our own label," he said proudly.

In 2007, the firm hired Greg Churchill to join the sales team, "and that really, really boosted our sales," Pete Aiello said. "He brought a wealth of business we didn't have before, and the rocket boosters went on for our bell pepper program."

Pete Aiello said that Uesugi Farms added Damon Barkdull to its sales team last month, and he noted that while the firm has a "well diversified clientele" comprised of retailers, wholesalers and foodservice distributors across North America, "we'd like to increase our market share in the retail sector. Hiring Damon is a means to that end."