Why we Sell wine and don’t Buy Exposure
18 July 2022
We get numerous emails, and phone calls monthly requesting free wine for a charity/corporate event etc. They promise a “great marketing opportunity” and “exposure” often with Celebrity or Famous Sports personalities present.
Our answer is simple, NO! So, save yourself the cost of the call.
We believe in a concept called FAIR EXCHANGE, but more on that later.
Wine costs time and money to make. Unfortunately, we cannot take a walk through the vineyard and pick bottles of 4-year-old Cabernet Sauvignon as and when we require.
Time: It takes approximately four years from planting for a vine to produce quality grapes and yields. During that time, your kids eat three meals every day, and their schooling and healthcare are getting increasingly expensive, not to mention rates and taxes as well as electricity and water costs. All of which need to be paid before your grapes are ready.
Money: If you start from scratch it takes a minimum investment of 4 years before you can start recouping any of your costs and if you are trying to make a “more premium” wine you may still age it in French Barrels for another 3 years for example Wine in South Africa is relatively cheap, hence our competitive export position, so margins require you sell volume to not only recoup your costs but also to have the ability to invest in growing your production and marketing initiatives. From experience and talking to others in the wine industry I believe it can take between 15 to 25 years to recoup your investment and become cash positive, of course, there are always exceptions, but they are few and far between.
If you were to sponsor a typical event of say 200 people and wanted to make a meaningful “marketing” impact with great “exposure”, we would wish to supply about 60 bottles of white, 60 bottles of red wine plus 60 bottles of Cap Classique, with a total cellar door cost to us of about R27500. Bear in mind that the cellar door cost considers the assumptions to recoup costs, investments etc. as detailed above, cost price does not.
So, by now, your think we are heartless Capitalists that don’t care for anyone else!
We think not and firmly believe that you cannot get anything in life with also giving. so we apply our “Fair Exchange Rule”. What is the Fair Exchange Rule? We believe Fair Exchange is a transaction that leaves both parties satisfied with the return on their contribution. There is no set formula, and this can differ quite extensively from one transaction to another, and we deal with each on a case-by-case basis. Let me give your 2 examples of our fair exchange initiatives we have undertaken.
- Eggs For Education – We believe education is the cornerstone for a chance at a better life. As such we approached Isabelo Charity, run by former Award-winning Chef Margot Janse in Franschhoek, to see how we could help. To date, we have contributed over R200 000 which buys 1500 pre-school kids in the area at least one egg a week as a source of protein for their their development by giving them meaningful nutrition so that they can start their education on a sound footing. Our goal is to double this to 2 eggs a week, as we grow. You can buy eggs on our website if this meets your “Fair Exchange Rule”
- The First Miracle Trust – we set this up in 2018 in partnership with my brother, Gary, who has over 30 years of experience working with NGOs worldwide. Whilst this can require money, it also is a time contribution. An example is our work with the Franschhoek Hospitality and Learning Academy. Every Harvest they send their students to participate in a harvest day with us, we believe this is a great way to learn about wine and the industry of our valley. We have on occasion sponsored a student as well, who wishes to get more directly involved in the wine world. This is funded jointly by us and then with the proceeds from our limited Edition First Miracle Magnums sales.
To conclude. If you are selling exposure, we aren’t buying, the Bank doesn’t recognise “exposure” as currency, and our suppliers won’t take it as payment either. If, however, you have a “Fair Exchange” project that you think will align with our goals and can make a meaningful and sustainable difference, then maybe……