Coronavirus and SA wine: Chris Alheit of Alheit Vineyards
By Christian Eedes, 7 May 2020
The current conversation around Coronavirus and its effect on the South African wine industry is perhaps inevitably very emotionally charged.
We put the same set of questions to a variety of industry stakeholders with a view to obtaining a better understanding of what’s happening on the ground and also plotting a way forward.
First to respond was Chris Alheit of Alheit Vineyards. He added the following proviso: “I’ll answer what I can, but obviously I’m just a winemaker, not an economist or an actuary. Plus I truly respect our president, but find the current decision making impossible to reconcile with logic.”
How badly has the Coronavirus crisis impacted your business?
The magnitude of the impact is yet to be seen. We are largely an export business, and the European/American/Asian restaurant scene that our wines feed into has been hugely affected. The entire ecosystem both locally and abroad that our wines feed into has been damaged. Most of our importers are very strong, but even so, we’ll have to see what kind of allocations they commit to in light of the new restaurant landscape. I do however remain very positive due to one fact: people want to drink nice wine, and top-end SA wine provides brilliant value in comparison to many other countries’ top-end offerings. Let’s hope I’m right. The other side of that coin is that if people have limited funds they will spend their money on the classic regions that they know instead of branching out into SA wine. Aside from that, we have experienced significant delays in receiving packaging material. This will further delay our income stream.
How many wineries do you foresee closing as a result of the pandemic?
I have no idea, but it will not be a handful.
What plans do you have in place to get going again once restrictions are eased? How will doing business be different?
I think we need to brace for impact, be careful with our money, and keep on finding ways to improve our direct sales. We have a solid mailing list, and we plan to make being on our mailing list really worthwhile by offering once-off wines, and best possible prices on our main wines. I think the silver lining here is for us to find better balance by being a bit less dependent on the wine trade, and a bit more involved in direct sales. Obviously we have great friends in the trade that have supported us from the outset, and I think the trade will bounce back, but having a stronger direct sales leaning makes a small business like ours less vulnerable in times like this.
What will the South African wine landscape look like after the pandemic? Will the industry recover quickly or will it be changed forever?
Again, I have no idea. I do think that this time will leave its mark for a while to come, but I’m not qualified to quantify the length of breadth of the disruption.