On a visit to Turkey last April, officials of Northrop Corp., the big fighter-plane manufacturer, made a detour to Anatolia where they spent a day visiting vineyards, inspecting wineries and sampling the pleasant local vintages that are little known outside the country.
That side trip led to a surprising company conclusion: Turkish wine might help Northrop sell Turkey sophisticated military aircraft, the F5G and the F18L.
Under a proposal that Northrop is still working out, the aircraft company would guarantee to find markets in third countries for tens of millions of dollars' worth of Turkish wine, refrigerators and other products in return for Turkey's selection of Northrop's planes over General Dynamics' F16.
Such unconventional business arrangements, called "offsets," have become increasingly important in the highly competitive trade in costly, modern weaponry.
As part of its sale of F18As to Canada, Northrop helped line up a customer in Liberia for a Canadian maker of paper cups. The company helped Swiss companies sell elevators to Egypt and precision drills to Spain as part of a 1976 deal for 72 F5Es.
And McDonnell Douglas officials say that "offset" will be a key factor in whether it succeeds in selling its long-range, ship-destroying Harpoon missile to Canada.
The reason for this is money.
Western governments and arms manufacturers, which have invested billions in a new generation of high-priced electronic armaments, are competing aggressively to sell the new equipment abroad.
But the world recession has left many of prospective buyers deeply in debt and short of funds for new purchases, and the U.S. government has scaled down its military aid and credits worldwide.
In this situation, the possibility of offsetting the costs of buying military aircraft with revenues from new exports, or with other techniques, has become a necessity.
Arms manufacturers have traditionally sweetened deals involving expensive items such as tanks and aircraft with arrangements that allowed countries buying the weapons to produce some or even all of them in order to offset the costs, save foreign exchange and create jobs.
However, Northrop officials contend that they are pioneers in marketing a customer country's products to third countries in return for aircraft sales.
Northrop initiated this technique in the early 1970s when it was trying to sell 72 F5Es worth $450 million to Switzerland. As an inducement, Northrop promised to find markets for $136 million worth of Swiss products.
It set up a special office in Switzerland, inventoried 800 Swiss companies and established a computerized library of exportable Swiss products at Northrop headquarters in California. Finally, Northrop representatives all over the world were told to be alert to markets for the Swiss products.
As a result, officials say, within five years Northrop helped 200 Swiss companies find markets for $209 million worth of products, mostly in countries other than the United States. On July 1, 1981, Northrop won another order for 38 more F5s.
Northrop officials say they also quickly exceeded the goal, set in connection with the sale of F18s to Canada in 1978, of helping Canada find markets for $30 million worth of products.
Company officials say the sale of the paper cups came as the result of an alert, Nigeria-based Northrop representative's chance meeting in Liberia with a businessman who expressed an interest in importing paper products. Northrop put him in touch with a paper company in Canada.
In Turkey, offset terms are emerging as a possibly decisive factor in a competition between Northrop and General Dynamics in which hundreds of millions of dollars' worth of business is at stake. For Northrop, the Turkish outcome has taken on added importance since the U.S. government turned down a request to sell the F5G to Taiwan and the company has not yet found an overseas market for the plane.
Although the United States lifted its partial arms embargo on Turkey in 1978, Turkey has continued to postpone modernization of its armed forces while it grapples with huge foreign debts and an economic crisis.
Now, senior U.S. military officials have stated, Turkey's NATO-assigned armed forces need new equipment that could cost as much as $5.6 billion.
Turkey is giving priority to obtaining sophisticated fighter airplanes to replace F104Gs, already obsolete, and F100s, which Turkish officials say will be obsolete by 1984. The government in Ankara has reportedly narrowed its shopping list down to F5s, F16s and F18s.
The U.S. government has authorized $400 million in foreign military sales credits, but this is not enough to cover Turkey's needs, Turkish officials say.
This was the problem uppermost in the minds of a Northrop commercial team that spent almost two months in Turkey in April and May, interviewing officials, businessmen and trade associations and making an inventory of Turkish companies with export potential.
In addition to promoting such items as refrigerators and wine, Northrop officials say they have apprised Turkish construction companies of projects in Nigeria and Saudi Arabia that could earn money for Turkey and might count as an offset against purchase of F5Gs or F18s.
Northrop officials who have sampled Turkish wine describe it as better than some wines sold at some Washington bars. But Northrop's role, officials stress, would not be to buy the wine as payment for the planes, but to locate a foreign merchant who might want to import it.
"We want to sell American aircraft and we have 5,000 suppliers around the country who depend on us," said Les Daly, a spokesman for Northrop. "We're creating jobs here in the U.S. We feel we cut into the U.S. market at a minimum because we focus on exports to third countries."