Partnership – the only choice
It is hard not to be moved by the phenomenal international support for South African wine via social media groups such as SaveSAWine and MoveOneMillion. We’ve been debating whether wine really can be more than product, but perhaps the dire circumstances we’re currently facing reaffirm the importance of people and perception when it comes to wine.
This week I joined a discussion addressing exactly these issues. Talking to the passionate CEO of Agbiz, Dr John Purchase, Vinpro’s Rico Basson, Maryna Callow from WOSA and co-wine farmer Beyers Truter, I couldn’t help but to find some positivity in what is a very bleak time for the Winelands. Please listen to the discussion by following this link. I share a few insights below.
South Africans living abroad and tourists who have been to South Africa, are buying South African wine to stimulate international sales while the ban on local sales are hurting the industry. They are sharing their messages on social platforms and encouraging others to do the same. We’ve seen plenty of protest and we’ve been debating its success, but perhaps this is as positive as protest can be! Covid will continue to affect the way we do most things and for wine and tourism it is crucial to identify how the consumer has changed. Behaviour and spending power are not the same and it is up to the industry to acknowledge and respect consumers with an adapted offering. While the consumer is essential to any business, no industry can survive without its workers and usually when the industry suffers, it is also the workers who are most affected. For me, this is one of the biggest concerns. The wine industry has small margins and according to Rico Basson, even before Covid, 30% of producers struggled to show any profit. 22 000 jobs in a rural and farming environment, where unemployment is an everyday challenge, are more important than the number suggests. The socio-economic impact of closing wineries and tourism establishment is extensive.
Wine is about much more than the current vintage. It is all about long term planning. Seven year forecasts are necessary when vineyards have to be planted and at least three year budgets are required for when we decide on winemaking volumes. The current crisis might have us skip a vintage because we are not selling according to what has been budgeted. The over-supply obviously drives down prices and there is no way to recover the value of value-added stock such as barrel-matured red wines. This sees us not only losing job opportunities during pruning, harvesting and pressing, but will also affect the niche industry players with small volumes, the treasured older vineyards and wineries focusing on cellar door sales. We risk loosing 20% of the industry – about 80 wineries! Innovation and a new language of wine communication are required. We can make hand-sanitizer from Pinotage, says Rico tongue in cheek, but more than short term solutions, we need a long term approach.
A lot of hard work and investment have gone into the quality of South African wine. Getting away from the image of cheap and cheerful and positioning SA wine as a value product, worth paying a good price for, is still a focus of WOSA. By planting vineyards in interesting areas, introducing fingerprint winemaking and focusing on the personalities of winemakers, SA wine has become exciting. Such excitement gives a wonderful advantage when it comes to publicity and marketing. But perception is not only up to industry and consumer. Government might have a different perception about wine and focus on the effects of irresponsible consumption. SA wine is, however, committed to regulations ensuring the responsible and safe consumption of alcohol. Prohibition is not the answer, it just encourages illicit trade. (Read more)
Losing R400 million a week gives the industry no choice but to insist on a solution. Even in these challenging times, the way to efficiently deal with a problems is to first identify the real issue. The abuse and irresponsible use of alcohol are the reasons for the ban. While the industry is committed to responsible marketing of its product, to some degree, we still rely on the individual to take responsibility for his/her own actions. While policing through official channels aren’t successful and alcohol-related trauma stays part of our environment, perhaps we’ll have to take a more hands-on approach. Issues such as drinking and driving and youth drinking can be addressed through stricter rules – indicating the designated driver or means of transport before being served alcohol, insisting on identification to prevent under-age drinking, etc. But problems can only be solved if there is communication and commitment. Education is key.
While immediate plans might include a targeted approach to selling alcohol, such as limitations on selling time and volume restrictions to reduce the harm and mitigate hot spots, we need to rethink and readjust for the long term. If there is one positive result from the ban, it is that it has forced communication and innovation. We now need to ensure that we use it to properly position the industry, to insist on recognition, but also to take responsibility. We are tenacious and as we have survived many challenges in the past, we can adapt and innovate. There is consensus though, that the road ahead is uphill and long. We will have to work hard and we will have to work together. While the initial focus is on lifting the ban, long-term stability is of the essence.
The wine farmer on his/her own can’t make it. Wine and Tourism are great partners. They’re both suffering, but they will have to continue supporting each other. Government has to understand the importance of these industries, both from an economic contribution and humanitarian or socio-economic perspective. Political buy-in is essential to encourage responsible use and stimulate the economy.
Reflecting on the discussion, I feel humbled by the efforts and insight of industry leaders. No one can blame those in Wine and Tourism if they’re negative, but even though we all know it will not be easy, I believe there is a road ahead. Our industry can be fragmented at times and now is a time to support each other and to stand together. It should actually be what we choose to do anyway, but at the moment, there really is no choice.