WHEN DGB (Pty) Ltd, the operating group of Douglas Green Bellingham wines, bought the Boschendal wine business from Boschendal Ltd in 2005, the brand was recognised worldwide, but only a small share of its production was sold internationally. It didn’t stop DGB CEO Tim Hutchinson saying, at the time, "In the UK, South Africa’s biggest export market, a very small share of South African wines are sold above the £6 price point. I believe that Boschendal could well lead South Africa in the £7-£10 category."
According to AC Nielsen figures for last year, the brand has done just that: Boschendal (pictured above) has the largest market share in the UK of all premium South African wines — that is, those that sell for more than £5. Total sales for the year increased by 13.2% to £4,703,000. Volumes increased by 8.5% to 641,000 bottles (750ml), and the average price per bottle increased from £7.03 to £7.33.
The news comes at a time of some uncertainty for the 328-year-old estate, which was not included in the 2005 deal. While DGB acquired the Boschendal wine brand, winery, cellar (with a capacity of 3,000 tons), production facilities and the wine-tasting and sales centre on the property, and purchases all grapes grown on the farm, others own the estate between Franschhoek and Stellenbosch.
Late last year, IFA Hotels & Resorts sold its 37.33% stake in Boschendal to Canombys Ltd, the trading name of an unnamed South African family living abroad. Mining house JCI’s 62.7% shareholding in the estate, which is being considered for World Heritage Status as a cultural landscape, was subsequently diluted. This gave the new owners a 51% stake, at which point the shareholders decided not to proceed with phase one of a residential development plan.
Although it seems, at this point, that the new owners will still go ahead with the phase two mixed-use development plan, the precise future of Boschendal, which is an amalgamation of farms originally amassed by Cecil John Rhodes, is unclear.
(Kristensen Hospitality manages the estate’s three restaurants, including the well-known Le Pique-Nique, on behalf of the owners.)
But the uncertainty has not and does not, says DGB marketing director Jacques Roux, in any way affect Boschendal wines. While the wines are made from grapes harvested from the vineyards on the farm in a cellar on the estate, which is also used as the brand’s "ancestral home" for marketing purposes, the businesses are separate entities. As such, DGB continues to enjoy uninterrupted success with the Boschendal wine brand.
"We’re independent and autonomous of any property deals that may or may not happen, and our success is part of a 10-year plan during which we’ve reviewed and overhauled the entire range. In fact, we’re busy preparing the next phase of the plan at the moment."
DGB’s strategy of "premiumising" Boschendal involved replanting vineyards, improving the quality of the premium wines and the upgrading of wine styles. The company also introduced new advertising and packaging.
Five wines in Boschendal’s 1685 range (Chardonnay, Sauvignon Blanc, Merlot, Shiraz and Shiraz/Cabernet) and Boschendal Lanoy Cabernet Sauvignon are sold in the UK. Listed with retail chains such as Tesco, Waitrose, Majestic and The Co-Op, the Sauvignon Blanc, Shiraz and Chardonnay are the bestsellers in the UK.
But DGB isn’t content with number one spot only in the UK. Says Roux, "We’re working hard to make inroads in other regions too, including Asia and Russia."