From finance to a fun winemaking experience, the allure of winemaking was enough to send stockbrokers Raymond Ndlovu and Kevin Swart to Franschhoek to start their own winemaking business. In this extract from Colour of Wine: Tasting Change, Ndlovu explains how his business accumen helped him grow their business.
The wine business is fascinating. You meet a diverse range of people from all walks of life. It’s an incredibly vibrant and colourful world.
I was a stockbroker for nearly three decades and got into the wine business through a fortunate coincidence.
At the end of 2011, my partner Kevin Swart and I sold our joint stockbroking business. He moved from Johannesburg down to Franschhoek and bought a smallholding property with a vineyard. He invited me to join him and it wasn’t long before I decided to also leave Johannesburg and move here with my family. I was tired of the finance world and ready for something new.
We made the decision to move to Franschhoek on a whim, with no real clue as to what was to follow. We went into partnership with winemaker Jacques Wentzel, and Black Elephant Vintners was born.
What we weren’t prepared for were the reactions to our decision to move to this quaint village. Regardless of people’s backgrounds, our decision to make Franschhoek our home, let alone invest in the wine industry, still draws sighs of bemused disbelief and curiosity.
So much of the wine business is about process, which you never appreciate in the fast-paced and unrelenting world of finance. You learn to work with Mother Nature and submit to her timeless process.
You never know what to expect from any vintage. When the grapes are ready to harvest, you have one opportunity, and that’s part of the intrigue and allure of being in this business. However, it’s also a complicated industry and I’m constantly learning. Winemaking isn’t a singular thing. You work with multiple suppliers, including the different vineyards from which we source our grapes. It’s about building lasting and fruitful partnerships with people. And, of course, aiming always to create the best possible product.
The challenges are not insignificant. The nature of the industry is that you’re always fighting a working capital cycle. Your cash is tied into what you see in the barrels and the tanks, and it takes a long time (two to three years) before you can turn that cash into income and, eventually, sustained profits.
As new entrants to the industry, we found it easy to approach it like any other business. Our business experience informed the capital-light initial investment and streamlined business model, with limited overheads. We combined basic business principles with the science of making wine and the art of experiencing the brand and consuming the wine.
Our model is to outsource non-core processes and business activities, for example, on the production side in terms of sourcing grapes from different producers on contract. We rent a large cellar in the vicinity, which enables us to scale our production volumes as and when we choose. We have established partnerships with a number of marketing and distribution agents, both in South Africa and internationally.
Both Kevin and I have a natural flair for marketing, branding and storytelling, which has stood us in good stead in positioning Black Elephant Vintners as a fun, unconventional and bold experiential brand, a kind of ‘rebels of the vine’.
We took the approach to grow slowly from home first. We wanted to be well known in our local market, starting here in Franschhoek, which is known as a food and wine capital of the country. We started by marketing our wines to local restaurants and guesthouses where there’s a constant flow of local and international tourists. From there, we extended our market to Cape Town and to the rest of the country, including Gauteng, KwaZulu-Natal and the Eastern Cape. We’ve also established sales channels in Namibia, Zimbabwe, Zambia and Ghana. Our steady expansion into overseas markets encompasses the USA, the UK, the Netherlands, Germany, Denmark and Austria.
We’re optimistic about the future of the South African wine industry in general and Black Elephant Vintners in particular. I never set out to be in the wine industry – but here I am. I’m happy to be a trailblazer. And, so far, we’re grateful for the road less travelled.
Source: City Press