After PMA and United acknowledged talks regarding a possible merger or other forms of cooperation, we tried to analyze why this time such talks might end up with some such cooperation or merger when all previous talks came to naught.
We felt that the opening of a WGA office in D.C., which we dealt with both here and here, might be one reason to think that this time will be different. Christian Schlect, President of the Northwest Horticultural Council, sent us a letter in which he pointed out that the WGA office might be a good thing.
It may wind up being a good thing for the industry — but almost certainly is a bad thing for United.
This letter, from one of the largest shippers in the country, explains why we think that way:
A few years ago, when United changed its dues structure, our company did not renew our membership with United. We happened to be very involved with other associations and United tried to ascertain whether we were attempting to make a ”statement” or “side with” a particular organization with which it felt itself competing. We were not… this was a financial-decision based on a substantial dues increase.
United tried to make us feel that we had a responsibility to pay for its government affairs efforts as, supposedly, we were benefiting from these efforts. We countered with the explanation that we paid Western Growers to represent us and that WGA was doing a fine job representing us in both Sacramento and D.C.
Even before it had a physical office there, WGA has retained lobbyists in the nation’s capital for decades.
Besides, we didn’t feel confident that we could count on United to represent us and our interests. What if an issue arises that pits California growers against Florida growers? How could a national trade association take a position?
United, as a national trade association, might help facilitate (though PMA presumably has a conference room and could help facilitate too) but, bottom line, as long as growers are state and regionally based, growers will always need state and regional representation.
The question that may decide the future of our national trade associations is simply this: Was our correspondent ahead of the curve or an aberration? Our sense is that in those states that have strong regionals, California and Arizona especially, this correspondent is increasingly in sync with grower/shipper views.
This is also why WGA’s Washington office is really a dagger pointing at the heart of United. As our correspondent notes, WGA has always worked D.C. but, up to the point of this new office being opened, United could distinguish itself by offering something unique: “feet on the ground” in our nation’s capital.
Technology, from the jet plane to video conferencing, to the Internet, has been gradually undermining this distinction for decades. Now WGA just delivered the coupe de grace to this argument.
This year’s United Chairman, Emanuel Lazopolous, is from Del Monte Fresh, and it strikes us that it is companies such as Del Monte, Dole and Chiquita — diverse companies that operate across the country and do extensive international work — that most need an organization such as United.
This is good for United as these are also the organizations with the best ability to support such an organization. The question is this: Do any of these large, diversified companies value United enough to pay, say, a million dollars a year in dues and sponsorships to the Association?
If not, how much are they willing to pay? One suspects that in this discussion, we will likely find the answer to the long term arrangements between produce trade associations.