At the same moment Frederick and Chloe were enjoying the thrill of expanding their territory in Brentwood, the Redwood office in Napa Valley was trembling with excitement of a different sort. Across the table, various English-language documents and Japanese drafts of corporate articles of incorporation lay scattered in disarray.
Dad adjusted his glasses and drew a red line through a specific clause in the document the lawyer had brought.
"For starters, I put together a draft, but I think it would be better to establish a separate corporation in Japan rather than going out as a branch office. A branch office is subject to too much control from headquarters, and the head office has to bear all the legal liability. The structure would be to first establish a holding company in Delaware, and then have that holding company own one hundred percent of the shares of the Japanese corporation."
Seeing how meticulously he was preparing, it seemed that the bitter experience of failure due to a partner's betrayal had helped Dad. It especially seemed that way considering he was thinking as far ahead as Delaware.
Delaware was a place with a corporate-friendly legal system, so much so that over sixty percent of major American corporations like Google and Amazon had their domiciles there. Of course, there were also significant tax advantages.
"You might not know this, but Delaware offers corporate tax benefits and also maximizes management's discretion in operating a company. And the Japanese entity won't be a stock corporation but a limited liability company, that is, a Godo Kaisha (GK)."
I secretly marveled at Dad's extensive knowledge while pretending not to know about Delaware myself.
"A Godo Kaisha? Is there a reason? Don't people usually go with a stock corporation?"
"Usually, yes. But a stock corporation has strict requirements regarding board composition and disclosure obligations. On the other hand, a Godo Kaisha is quick to establish, and above all, I can monopolize decision-making as the representing member. When dealing with a massive organization like Itochu Corporation, I think a light, vertical structure is best. Don't you think so?"
"That... is true."
I once again realized how little I had known about Dad until now. I had thought he knew nothing because he had fled here to farm, lacking ability, but that wasn't the case.
Dad grinned and added,
"When I worked in Korea, I experienced firsthand how foreign appliance companies structured their corporate entities to penetrate the domestic market. The distribution corporation's name will be Redwood Holdings Asia. Sound good?"
"Yes."
Just then, the office door opened and Warren Biniarski walked in. In his hand was an old leather bag.
"Woody, Brian. I heard the news about the corporation being established and couldn't just sit still."
Warren looked at the complex ownership structure diagram Dad had drawn on the whiteboard and let out a deep exclamation of admiration.
"The boss had more talent for this sort of thing than tending grapevines."
Dad smiled sheepishly at the praise from Warren, the legendary winemaker. Warren smiled back, took a document from his bag, and placed it on the table. I checked the stamp on the document and was startled.
"Huh? This is the official seal of Stag's Leap Winery? It's a letter of recommendation. Why...?"
Warren placed a hand on my shoulder and spoke kindly.
"That's right. I wanted to give you a gift, but I heard Japanese people value justification and formality. This is a letter of recommendation recognizing you as one of the wineries representing Napa Valley, so it'll carry weight wherever you go. And for this Japan launch shipment, I'll allocate a limited quantity of Stag's Leap 'Cabernet Sauvignon S.L.V.' The condition is that it'll be distributed exclusively through Redwood Holdings."
"No, this is too much..."
I wondered if he really needed to help us this much. Because Stag's Leap S.L.V. was from the lineage of that legendary wine that had taken first place at the 1976 Judgment of Paris.
Having this wine included in the distribution lineup meant it could exert considerable appeal on buyers at Japan's luxury hotels and department stores.
If it were a famous Romanée-Conti domaine in Burgundy, France, it wouldn't just be appealing—they'd be grabbing at our pant legs begging.
No matter how much higher scores Stag's Leap S.L.V. received than France's top-tier Grand Crus, Napa Valley wine still wasn't as popular as French wine among the Japanese, so it would only go as far as being appealing. And it was the same in Korea.
"Anyway, the volume going to Japan isn't large, so it wasn't a big burden. It's just a nice amount to mention. I simply asked them to set aside about ten cases, so don't feel pressured."
"Even that much is tremendous. Thank you."
I was deeply moved that he had gone to ask for this even though it was no longer his company.
"So now you'll establish the corporation and go to Japan?"
Dad shrugged at my question.
"Probably? I'll leave the Delaware incorporation to the lawyer and go."
"Wow... Dad's going to get busy now. Will you be going back and forth to Japan often?"
"Your mom will probably be happy? Since she won't have to prepare breakfast?"
Dad was the only one who ate breakfast at home. I could clearly picture Mom's delight at not having to get up early to cook.
A week later, at Itochu Corporation's headquarters in Tokyo's Minato Ward. Surprisingly, sitting in the meeting room inside the magnificent glass building was Brian's father, Woody Choi.
Across the table sat not only Kuroda, the representative, but also Itochu's legal team leader, logistics team leader, and elite employees from the strategic planning department with their arms crossed.
Before them lay the final contract drafted by Woody, specifying 'occupation of a dedicated bonded warehouse zone' and 'real-time sharing of payment data.'
The logistics team leader pushed up his glasses and opened his mouth in a firm voice.
"President Choi, the clauses you mentioned are unprecedented in Itochu Corporation's history. Occupying a dedicated zone within a bonded warehouse is legally complex, and real-time linkage of payment data with an external corporation is nearly impossible from a security standpoint. I believe this is an excessive demand... And isn't it true that you have not yet established a local Japanese corporation?"
Kuroda was wiping cold sweat beside him with a distressed expression, but Woody didn't change his expression one bit. He figured the Japanese major trading company's signature "wait with a hundred reasons why it can't be done" strategy had begun.
Rather, Woody leisurely took out another document from his briefcase and slid it to the center of the table.
"Don't worry about the corporation. We've already completed the name change registration for 'Redwood Holdings Asia' through a shell company. Check the registration number here. And team leader, if there's no precedent, why not create one this time?"
"That's...!"
"Actually, there are many places that would welcome these contract terms even if it weren't Itochu. Before coming, I had a brief call with the logistics team at Mitsubishi Corporation. They offered to open up the Lawson payment network, and even said they would arrange dedicated bonded warehouse personnel however we wanted. They were practically begging for Ceracia and Stag's Leap S.L.V., but here... seems a bit negative."
When Woody casually placed a pamphlet bearing the Mitsubishi Corporation logo on the table from his briefcase, the air in the conference room froze instantly. For Japanese trading company men, nothing was scarier than losing an opportunity to a rival.
"We came to Itochu first because of the trust with Mr. Kuroda, not because we lack alternatives. When fifty tons of Royal Tioga cherries, currently waiting to depart from San Francisco, land at Tokyo Airport, whether the trucks carrying that cargo go to Itochu's warehouse or Mitsubishi's warehouse depends on your answer right now, team leader."
The logistics team leader's eyelids trembled slightly. The moment all of this—fifty tons of cherries and the exclusive rights to the wine of Napa legend Warren Biniarski—went to Mitsubishi, his performance review would be doomed.
What slightly worried him was the 1,300 cases of cherry wine; if that also went to the other side and the reaction exploded afterward, it was horrifying just to think about.
"... We'll approve the dedicated bonded warehouse zone at the operational level. But system integration is a security issue..."
"You only need to open part of the API for the POS system Itochu owns. I'll handle the rest."
After a long silence, the logistics team leader let out a deep sigh and nodded.
"Very well. Let's sign. However, the condition is that Redwood bears all logistics costs."
"Excellent. We'll pay the money, so team leader, clear out the most prime warehouse space for us."
Dad signed the documents with confidence. Kuroda, the representative who had been watching the negotiation, finally let out a sigh of relief and sank into his seat.
The heart of Tokyo, Ginza. Among it, the food hall of the luxury Matsuya department store, which Itochu Corporation managed with great care, was a barometer that most vividly revealed the consumption psychology of Japan's upper class.
The normally quiet and elegant entrance to the food hall was bustling with a strange heat today. At the dead center of the floor, in the 'Golden Slot' under the most brilliant lighting, deep crimson fruits like jewels were piled up like a mountain.
They were Royal Tioga cherries, shipped direct through the dedicated gate of the bonded warehouse Dad had secured, as soon as Itochu's dedicated cargo plane from San Francisco touched down at Narita.
"Oh my, what is this? How is the color so deep?"
A middle-aged woman carrying a luxury bag stopped in her tracks. Where her gaze landed, a small box of about 500g sat. The price tag clearly displayed the figure '4,500 yen.'
It was more than triple the price of ordinary cherries, but the promotional phrase beside the box touched her pride.
[The one and only cherry loved by America's magnates, direct from Harris Orchard]
"Would you like to try one? This batch was harvested yesterday morning in Brentwood, California, and flown over."
An employee in a refined uniform carefully handed her a single cherry. The moment the woman plucked it up with slender fingers and placed it in her mouth...
Crunch.
The juice that burst from the thin skin was like thick syrup. It wasn't the bland sweetness of ordinary cherries. An overwhelming sugar content exceeding 20 Brix, backed by a luxurious acidity. Every time the uniquely firm flesh of the Royal Tioga was bitten, it made a cheerful sound.
"Goodness... how does a cherry have this texture? It's much richer than what we had at Uncle Sato's house."
"It's a limited quantity, madam, so only three boxes per person."
Before the employee even finished speaking, the woman held out her card.
"Three boxes, please. Oh, and what is that bottle over there?"
What she pointed to was the rose-tinted wine 'Ceracia,' displayed like a jewelry box beside the cherry boxes.
"It's a wine that captures these very cherries in a bottle. A limited edition made by Brian Choi, the winemaking prodigy of Napa Valley. Right now, the most famous winery in America is Brian Choi's Redwood. We're offering a special tasting opportunity only to those purchasing the cherries right now."
Ceracia was poured into a small disposable plastic cup. The primal fragrance of cherries enveloped the display area instantly. When the woman took a sip, the cherry flavor she had experienced earlier decorated her nasal cavity splendidly on the vapor of alcohol.
"My... the wine is incredibly delicious. So elegant."
"If you purchase today, we'll issue you a specially made Redwood Holdings VIP membership card. It grants you priority reservation rights for limited-edition wines produced in Napa Valley going forward."
This was the core of the bundling marketing strategy Woody had designed. An algorithm that instantly converted consumers who bit into the powerful bait of cherries into loyal customers of Redwood Holdings.
"Two bottles of the wine as well, please. One for me to drink, and one to bring to a gathering tomorrow."
Once one person began buying, orders flooded in like a burst dam. The department store food hall was instantly swarmed with people converging on one spot, and the rumor that this was "the cherry America's wealthy eat" spread throughout Ginza via text messages and word of mouth.
And in the homes of Japan's wealthy who bought the cherries, VIP membership cards piled up one by one.