文章基本信息

标题：Big Aussie move into California - Southcorp Wines
作者：Larry Walker
期刊名称：Wines Vines
出版年度：1997
卷号：June 1997

Big Aussie move into California - Southcorp Wines

Larry Walker

In a joint venture put together with astonishing speed, Southcorp Wines of Australia and Paragon Vineyard of California are launching their Seven Peaks wines this summer.

The alliance between Australia's largest wine group and vineyard holder and Paragon, the Central Coast vineyard company with a reputation for top quality, owned by the Niven family, is called the Independence Wine Company. The deal was put together and is managed by Robert Nicholson, who heads International Wine Associates in Healdsburg.

Nicholson said the first contact between Paragon and Southcorp took place in May, 1996; the deal was signed in August.

Roughly, here's how it works: Paragon supplies the grapes and the vineyard expertise; Southcorp supplies the winemaking skills and the marketing distribution. It came about a few years ago, according to Niven, when Paragon realized it should be in the red wine business.

"We worked out a plan where we could pool our resources as a grower with a wine partner with distribution and marketing contacts and we looked toward Napa for that partner," James Niven said.

About that time, Nicholson got involved. "We had a short list of prospective partners," Nicholson said, "but none of them were working out."

"The people we really wanted to hook up with were all too busy with their own successful programs to come into the deal," Niven said, "although they all agreed it was a great idea. At that point, Nicholson suggested that we look outside of California."

"It was a logical step, given the growing global focus of the wine business," Nicholson said.

Nicholson knew that Southcorp had an interest in moving into the international market as a producer as well as distributor. The first contact was made in May with Jose Fernandez, who heads up Southcorp's North American office in Monterey. Fernandez has over two decades in the wine business, including a stint with International Vintners.

"He liked the idea and we took it to Australia for meetings in June. In August the deal was signed," Nicholson said.

"And the next day, I started looking for grapes," Niven said. The ability of Paragon to find good grapes on such short notice is a major part of the story, according to Nicholson.

Paragon sells to a number of major wineries itself and because of over 25 years of growing grapes on the Central Coast, has an extensive network of contacts with other growers.

"We started calling in chips," Niven said. "Remember, this was August and naturally we were told that nobody had any grapes to spare. Well, we went out into the market and called on some old friends and somehow we managed to get enough together to make our first Seven Peaks Chardonnay," he said.

Fernandez said that from the beginning, after the series of mergers in 1990 that resulted in Southcorp, the focus was to grow internationally.

"We already had one-third of the Australian market and we realized it would be hard to grow much there, so offices were set up outside Australia and we have developed a strong global network," he said.

That led to the next step of getting involved in wine production in the U.S. itself. "Australian wines are less than 1% of the total U.S. wine market. It seemed like an obvious move," he said.

Asked if having Australian wine-makers in California making wine might not lead to charges of "carpetbagging," Fernandez said he didn't believe so. "We will be making California wine, but with an Australian accent. Because we will be sourcing grapes from a number of vineyards on the Central Coast, blending is a key part of the winemaking process and that is something that is at the core of Australian winemaking philosophy. Taking elements from here and there and making regional blends to produce the wine." Nicholson agreed, adding that there are certainly outstanding single vineyard Australian wines, but the philosophy is to blend for character.

Nicholson emphasized that the focus was on cooperation between the two partners. "They both have a high quality image and this is a unique opportunity to blend the Californian viticultural skills with the Australian winemaking skills."

The projected volume for the Seven Peaks brand is for about 250,000 cases, fairly evenly split between white and red wine. The program will include a very small amount of Pinot noir, perhaps 3,000 cases, about 130,000 cases of Chardonnay and the rest red wine, split between Cabernet Sauvignon and Syrah. The first release of Seven Peaks Chardonnay will be priced to sell retail at about $12. It will carry a California appellation. A Seven Peaks Reserve Chardonnay with an Edna Valley appellation will be released in the fall at about $20.

The first wines were made in leased facilities but as the brand grows, a winery will be built. The exact site is still under discussion. "First we want to build the brand," Fernandez said. "We start from there."

(The Seven Peaks refers to a series of volcanic cones on the Central Coast. The most visible one being Morro Rock with towers above the waters of Morro Bay.)

In the beginning, the Chardonnay will be in about 15 major national markets, with the focus on California, according to Fernandez. Once production is expanded, the wines will begin to move into the international market, including Australia.

Although the long-term focus is on Edna Valley fruit, for the time being, Seven Peaks wines will carry the California appellation except for the Reserve Chardonnay. The regular bottling of Chardonnay has about 50% Edna Valley fruit. "We will be sourcing grapes from Santa Barbara, San Luis Obispo and Monterey counties and we don't feel we should tie ourselves down to one appellation. We are also having vineyards planted under contract," Niven said.

The prospects for Syrah have both partners fairly bouncing with excitement. "The soils of the Central Coast are ideal for growing Syrah," Niven said. "Syrah will grow anywhere, but in rich deep soils it over-produces. Ideally, Syrah should come in at four to five tons an acre. I'm excited about it, because I don't think anyone does Syrah like the Australians. Even though they tell me I don't know how to pronounce it. But whether you call it Shiraz or Syrah, it's good."

Fernandez said he believes that in ten years, the Central Coast will be known as the Syrah capital of California.

One of the things that makes the partnership work, according to Nicholson, is that there is no overlap between the partners. They don't compete on services. "Our joint goal is to get the job done, not compete internally," Niven said.

The partnership is completely 50/50 in structure. "There was some worry about that in Australia," Fernandez said, "But I think it was the only way to do it. We have to be completely equal partners."

The partnership works both ways in what Niven calls a cross-pollination of ideas. "We have set up a dialogue between the vineyard and the winery. We have had people go to Australia and they've had people come here. We are doing experiments on rootstocks, clonal selection and many other areas. It's been very interesting to see how both sides work."

From a strictly marketing point of view, the brand positioning objective is to place Seven Peaks as a high-profile super and ultra-premium varietal brand. The objective is to offer current wine consumers the opportunity to enjoy a new style of full-flavored California varietal wines at a good value and to offer new wine consumers an opportunity to trade up to a varietal wine offered by two leading names in Australian and Californian winemaking.

Throughout the marketing plan, the "full flavor" concept is dominant as well as a consistency from vintage to vintage.

The competition is identified primarily as California varietal brands and only secondarily imported wines. Primary California competition for the regular bottlings, according to Nicholson, includes; Kendall-Jackson California varietal, Robert Mondavi Napa Valley and Coastal wines, Chateau St. Jean, Clos du Bois, Meridian, Beringer Napa Valley varietals, Gallo Sonoma varietals and Chateau Ste. Michelle. For the reserve wines, primary competition includes Robert Mondavi Carneros, Jordan, Sonoma-Cutrer and other California boutique brands.

Potential consumer graphics include people who are:

* Age group of 25-65;

* Evenly split between male and female;

* Attended or graduated from college;

* Income of $50,000-plus;

* Positively influenced by the reputation of Southcorp brands and the Niven family;

* Have some curiosity about new wine products;

* Are conscious of food and wine trends;

* Like to order wine by the glass in a restaurant;

* Frequently serve wine to guests at home.

Nicholson said that purely from the standpoint of doing a business deal, it was a very simple and low overhead way to get into the wine business.

As for the future of such international partnerships, they might not look like the Southcorp-Paragon deal, which brought together two very strong partners, but there is little doubt that the global outlook is here to stay.

Referring to the many such ventures now going forward, Fernandez said, "You can't put the global genie back in the bottle. Growers on the Central Coast are now in competition with growers in Chile, Argentina with the global bulk market. Nothing will ever be the same again."