Lady in red has nose for wine market

Winemaking has proved a profitable business for Romanian entrepreneurs despite the market decreases in the past couple of years. Aurelia Visinescu, an award-winning Romanian oenologist and managing director of Domeniile Sahateni, told BR what it is like to sell Romanian premium wine in China and shared her opinions on whether 2012 will be more of a vintage year for the local market.

Simona Bazavan

You are the first female oenologist turned investor in Romania. Has the fact that you are a woman ever been a professional setback?
I get this question very often. The answer is no, it hasn’t been a disadvantage, on the contrary. However, I did get a head start in my career. I decided I wanted to become an oenologist in my final year at the Horticulture Faculty and I chose to major in this field. After graduation in ’93, I learned that a major local player at that time, Vinexport, was hiring an oenologist but that they were looking for a man. I simply went, knocked on their door and left a CV. They called me back and after an interview they hired me. Ironically, my first assignment was in Sahateni village.
 

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How did the local market evolve last year and what are your estimations for 2012?
The official numbers aren’t out yet but in 2011 the market continued to decline on all segments. I believe by the end of the year there could have been a slight recovery. Overall, I would say the Romanian wine market shrank by about 10 percent last year in volume.
Nevertheless, the market is evolving, in the sense that local consumers are maturing and winemakers too are investing in quality. The premium segment especially is starting to gain share because as imports have gone up, consumers were able to make comparisons and many are now turning to Romanian premium wines due to a better price-quality ratio. I estimate the premium segment in Romania, both imports and locally made wines, to be no more than 10 percent of the total market in 2011. On the other hand, we see that when it comes to wine, Romanian consumers continue to be very conservative in favor of established local brands. Young people are more willing to experiment and try lesser known labels. This year I don’t see the market continuing on a downward trend. If anything, it will maintain last year’s levels.
 

What about exports? Are foreigners interested in Romanian premium wines?
There isn’t a lot of interest in Romanian wine in general. Exports of Romanian wines have been on a downward trend ever since 1990. Those who come to taste local wine appreciate it, but many foreigners don’t even know that Romania is a wine-producing country. The image that Romania has abroad is also an issue, but I would say that the main problem is the fact that those of us looking to export are mainly small companies and this makes it hard to set a global trend as happened in the case of countries like New Zealand, for example. Large local players are less interested in expanding abroad. Perhaps this will change in the years to come.
Romanian wine sells very well in China, because it is a huge market and right now it is easier to sell there than anywhere else. Asia in general is a good market, followed by the USA, while in Europe it is harder to sell.
Last year about 30 percent of our turnover was generated by exports. It is much more profitable to sell abroad than in Romania. Asia was our main export market with countries like China, Japan, Thailand, Taiwan and South Korea, but we have also exported in Europe. In 2012, I would like to consolidate our position in Japan and enter the British market.  
 

In the past few years we have seen quite a lot of entrepreneurs investing in small wineries of under 100 ha of vineyard but there haven’t been any large newcomers. Do you think that we could witness large international players entering the Romanian market?
Yes, several investments have been made in smaller wineries in the past years and this is a very good thing for the local wine industry. And we will probably see more such entrepreneurs in the years to come. As for large international players coming here, I don’t see it happening. Romania is an expensive market for such companies in the sense that there are other countries that have already established themselves internationally as wine-producing destinations and where everything is much cheaper than in Romania – and costs are very important for large players. Here it would be very hard to invest in anything except the acquisition of an existing company. I myself have been struggling for 10 years to buy 100 ha of vineyard that is simply at a decent distance from the winery. It is quite hard to consolidate a plot of no more than 3 ha of vineyard.
 

How much have you invested so far in the Domeniile Sahateni business and what are your plans?
The company was set up in 2003 and the first production to be entirely bottled at our winery was in 2007. The initial investment was about EUR 2 million, including EU funds and a loan. I own 50 percent of the business and my associate (e.n. Steve Cacenco) the other half. To date we have invested roughly EUR 5 million, about EUR 1.8 million of which are various EU funds.  We own 70 ha of vineyard in the Dealul Mare region and a modern winery close by. I intend to buy an additional 15-20 ha of vineyard and this year we plan to replant 14 ha of the existing land. This spring we will finalize an investment project in boosting the winery’s production capacity to one million liters with a focus on premium wines. Early next year we plan to start work on a 20-room pension close to the winery. The project will cost about EUR 300,000 with about two thirds coming from EU funds.

What is your turnover target for 2012 and do you plan to launch new products?
Last year we managed to grow by about 50 percent to roughly EUR 1 million and in 2012 I estimate that business will go up by more than 50 percent. It is only normal considering that we are a start-up. The growth will come both from the internal market and exports. There are three collections of wines that are sold under the Aurelia Visinescu brand.
Locally about 70 percent of our sales are generated by horeca, specialized wine shops, and we also have a mainstream brand, Nomad, that sells in large retail networks albeit it doesn’t perform locally as well as it does abroad. On the premium segment we have the Artisan collection which consists of six wine varieties sold exclusively in horeca and specialized stores and the Anima collection which are limited edition wines produced only from our best vintages. This spring we will launch the Karakter collection which will initially consist of four wines, all of which are internationally known varieties – chardonnay, sauvignon blanc, rose and cabernet sauvignon.

simona.bazavan@business-review.ro

CV Aurelia Visinescu

1998 – 2006 – Production manager and managing director at Cramele Halewood, part of Halewood International
February – March 1999 – Winemaker at Griffith, NSW, part of Nugan Quality Foods in Australia
March – April 1997 – specialization at Orlando Wyndham in Australia