Two years ago, Paul Kraft was working for Starbucks when a chance meeting with Nobumitsu Tamai, the CEO of boutique investment bank FinTech Global, gave him an idea for a product that might sell in Japan – HoneyBaked Ham.
Originally from Minnesota and having been in the food industry for 20 years, Kraft didn’t need much convincing, especially since his brother-in-law used to manage a store for the HoneyBaked Ham Company of Georgia. Kraft went to see the CEO on Valentine’s Day in 2012, and after a lot of negotiating, he signed a contract to be the exclusive licensee of the brand in Japan this past June.
It’s now all systems go and in the second week of October, HoneyBaked Ham will be sold in Japan – the company’s first foray outside the United States.
Kraft says there is a great demand in the Japanese market for premium American brands and added that the HoneyBaked Ham fills a market niche with its unique glazed and spiral-sliced on-the-bone hams. Each HoneyBaked Ham is hand-selected for leanness, smoked up to 24 hours, then spiral-sliced to the bone so each tender, juicy slice is easy to serve. They are then glazed here in Japan after arriving from the U.S.
Japan Today editor Chris Betros visits Kraft at his office in Toranomon to sample some ham and hear more.
How did you convince the CEO of the HoneyBaked Ham Company to start exporting to Japan?
First, I contacted him by email. I introduced myself and said I was interested in bringing HoneyBaked Ham to Japan, and that we had financial backing. I went to see them on Valentine’s Day in 2012. It is a privately owned family company. Japan was not on their radar, but they did know that people in Asia, especially China, eat a lot of pork. Three of their executives visited Tokyo last November and they were blown away by the food culture, the opportunity, the packaging and department store basements.
When do you start sales?
We are aiming for the second week of October, beginning online and B2B business and eventually, we hope to have a retail presence. We will start taking reservations for Christmas, which I think will be especially important for the foreign community.
How are you positioning the brand?
As a premium ham -- bone in, with crème brulee-like glaze on top. We are targeting high-end hotels, Tokyo American Club, Roppongi Hills Club, and so on, so that they can see this beautiful half ham. We are also having talks with some high-end retailers, but the hotels are our first target because they have lots of events and parties.
What is their reaction?
They are extremely surprised because glazed bone-in hams are unlike anything currently available in Japan. We meet buyers and chefs at hotels and time and time again, we get a very positive reaction.
What has your market research shown you about ham consumption in Japan?
Japanese love ham and eat it more often and on more occasions than Americans. About 30% of all Japanese ham is consumed at breakfast. Japanese love ham on toast. I was amazed at that figure. Ham is also the No. 1 gift item during the “ochugen” and “oseibo” gift-giving seasons because of its flexibility. We did focus groups and when Japanese housewives have ham in their fridge, they view it as their “backup” ingredient or even their “helper.”
How much does a ham cost?
A 4-kilogram ham would be about 13,000 yen. It sounds expensive but for a party it is much less than other options and adds a very high-end atmosphere. It is a premium product and there is the cost of importing, transportation, as well as a tariff on ham that which is 8 1/2%. However, we will be able to offer smaller packages, such as a quarter size which becomes much more manageable for refrigerators in Japanese houses.
How are you getting the word out?
Right now, we are telling the foreign community that we are here, especially the U.S. military, as well as at the Tokyo American Club and the ACCJ (American Chamber of Commerce in Japan). We are active on Facebook. We are planning a promotion called the Honey-Baked Ham Happy Hour. We will go companies with ham, cheese and bread and have a happy hour casual get-together in their office. Details for a program with ABC Cooking Studio are being finalized
How are you going to educate Japanese shoppers?
Housewives don’t often see ham on the bone. They don’t even think of it as ham, but meat. So this product requires explanation and sampling. We need to teach them that you can freeze it, and use the bone to make soup. Once we have a store presence, we will sell 200-300 gram packages sliced off right in front of customers, like a carving station.
In the lead-up to the start of sales, what are you focusing on?
I am an early riser and am usually here by 7 or 7:30 a.m. I spend the morning on the infrastructure of the business. In the afternoons, I’m out meeting customers.
The most important thing as we begin sales is to fulfill the promises we have been making with our products. I have a Japanese food safety license, so I can glaze the hams myself. We will train others to do it, monitor quality and follow up with customers.
How much ham do you eat?
Probably about half a kilogram of ham a week. Sometimes my wife asks me how come we don’t have any left. How can we possibly be out of ham, she wonders. We have a ham fridge at home.© Japan Today