Coronavirus and SA wine: Nico Grobler of Eikendal

Nico Grobler of Eikendal.

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. Here is how Nico Grobler of Eikendal in Stellenbosch replied:

How badly has Coronavirus crisis impacted your business?
70% of our sales per month are not able to take place. The impact is significant but we’ve worked around it to survive.

How many wineries do you foresee closing as a result of the pandemic? What future for growers?
I really can’t put a number on it but we all know a lot of producers/ growers were struggling pre-Covid-19. They would not have the means to survive – Covid-19 has just brought the inevitable to a lot of them.

What plans do you have in place to get going again once restrictions are eased? How will doing business be different?
We focused on getting as much as possible of our export business done. This gives us the cash flow to operate once restrictions are lifted. Importers have been very sympathetic pushing orders forward and actually pre-paying. Pre-orders have been processed with delivery set to take place as soon as allowed. This has given us a nice cash injection as well.

A big focus going forward will be private sales with door-to-door delivery – online partners are really important now. Then, retail: We have a strong base and we have been and are currently working with our trade partners on giving good value to the consumer post restrictions to boost sales and generate cash. In general, your brand equity pre-restrictions will be tested.

What will the South African wine landscape look like after the pandemic? Will the industry recover quickly or will it be changed forever?
There will be a definite change for the time being as on-consumption sales will take a long time to recover. Direct sales to the consumer is going to be big. When it comes to exports, the weak Rand and low inflation will help us in the short term. The industry has no choice… we have to recover but we need to re-think how we worked in the past and how we should move forward. Hopefully we can move away from all the cost we have to incur before we actually getting a listing or a sale… and move the market into a direction where producers are paid what they deserve for their products.

Read other interviews:

Chris Alheit of Alheit Vineyards
Tertius Boshoff of Stellenrust
Paul Clüver of Paul Cluver Wine Estate
Boela Gerber of Groot Constantia
Anthony Hamilton Russell of Hamilton Russell Vineyards
Gerard Holden of Holden Manz
Johan Kruger of Kruger Family Wines
Bruwer Raats of Raats Family Wines
Donovan Rall of Rall Wines
Mike Ratcliffe of Vilafonté
Johan Reyneke of Reyneke Wines
David Sadie of David & Nadia
Eben Sadie of Sadie Family Wines
Duncan Savage of Savage Wines
Lukas van Loggerenberg of Van Loggerenberg Wines
Michael White of Highlands Road