Winemaking is one of the commercial activities that has experienced the greatest growth in Argentina in the last few years. The head of a family business that is succeeding in the international markets offered advice to SMEs and shared his experience.
Aldo Luis Biondolillo defines his company, Tempus Alba, as “a small family winery, endowed with highly qualified human resources and state-of-the-art technology -used for both grape growing and winemaking- which is comparable to that of the most modern winemaking companies around the world.”
It is worth noting that this family company started to export its products only 5 years ago and is now selling its wines in 14 countries. Tempus Alba’s General Manager Aldo Luis Biondolillo has a lot to say that may be interesting for those taking their first steps in the wine business.
What are your views with respect to the current situation of the Argentinian wine industry?
Winemaking is one of the few agroindustrial activities that keeps growing steadily in the export market, both in terms of production and commercialization. And current data show that this trend seems likely to continue. As entrepreneurs, our aim is to create the conditions to make wine companies sustainable. We are optimistic that the future development of the activity will be linked more to the international than to the domestic market. We should bear in mind though, that attracting foreign markets will call for efficient, technologically well-equipped and highly competitive companies.
Why have only bottled wine exports grown up to now in 2010?
Argentina has traditionally been known as a grower of grape varieties with low enologic quality produced to supply a domestic market that demanded volume rather than technology investment. This created a vicious circle of increasing production to meet the demands of the domestic market. Thus, what was known as a series of recurrent crises of overproduction in the sector led to a terminal crisis in the 80s. After hitting bottom, a new period started for the wine industry, which was characterized by the restructuring of vineyards, the incorporation of modern technology and new varieties with better enologic qualities, and better management skills. This new start was supported by a strong demand for red wine in the global market. In this context, Argentina’s wines were able to enter the international markets with price-quality ratios that were among the best in the world. The country became highly competitive in the international market, as it offers premium wines at lower prices than its competitors: that is why our exports have reached this level.
What are main problems that SMEs face when they decide to export?
The first problem is to define a strategy. Some companies want to cover 50 countries. I’d recommend they focus on a few markets only. It is also convenient to approach markets where you may operate independently. Another option is to pursue business alliances.
And in my opinion, differentiation is key. Each SME should strive to be unique. Though this may take a lot of time and hard work, it will eventually ensure a more permanent presence in the markets.
How did Tempus Alba get to grow as it has?
Our winery relies on strategic alliances with Mendoza’s fund for transformation and growth (FTyC, Fondo para la Transformación y el Crecimiento), ProMendoza and the Argentinian fund for technology transfer (FONTAR, Fondo Tecnológico Argentino). The funds granted by the FTyC helped us protect our vineyards by means of anti-hail nets, and last year, it also allowed us to expand the capacity of our vats at the winery. ProMendoza guided us along our process of commercial development. And FONTAR helped us by means of their non-refundable funds program, which we’re using to finance the evaluation of ten years of work devoted to the identification, selection and multiplication of Malbec clones. We’re already producing our own clones. Our future vineyards will be developed using material selected from the centennial genetic pool of Argentina’s commercial viticulture. Today we can offer our importers wines produced from grapes selected by ourselves. Though this is a costly and time-consuming task, it will help us pave the way towards differentiation.
Which are Tempus Alba’s main destination markets?
The winery first started to work with the US market. We made many mistakes there, which allowed us to learn and grow. We also did well in many ways. The United States is a very interesting market, characterized by a strong tendency towards increasing wine consumption, especially among the young, and by a high interest in and appreciation of new world wines. However, it’s is such a huge market that we had to approach it in a particularly collaborative way. We formed a group of 7 family wineries sharing the same technological profile.
We started to enter the US market through only one importer who covered the whole country. Four years later, we realized that this was really not the best strategy for Tempus Alba. Our exports were falling behind with respect to those of one of the wineries of the group, which was gradually driving the other companies out. After a thorough evaluation of the situation, we decided to look for regional importers and state distributors. In this way we were able to redirect and boost our exports.
Then Brazil came on the scene, and as we moved forward, we learned it was better not to use the traditional export channels that include importer, wholesale distributor, retailer and only then reach the consumer. We’re also present in the Dominican Republic and Canada. We ship smaller quantities to Canada than we do to the United States; yet we’ve attained very good results.
In Europe we target niche markets. We’re selling to England, Austria, Switzerland, the Netherlands and Belgium. We’ll soon be in Italy too. The population in these countries have good purchasing power, and our wines have been highly regarded by consumers. These markets are showing a continuous upward trend.
As for Latin America, we also export to Colombia and Uruguay. And in Asia, we export to China. We’re very pleased with the results. Though we’re not selling millions of liters, we have potential for growth in many markets. We search for different markets in order to diversify risks. That is Tempus Alba’s strategy to operate in the international market.
Translation: Inglés del Vino
Article re-print of "Aldo Biondolillo – General Manager of Tempus Alba “Differentiation is key"" written by Mariano Zalazar for Winesur.com
Source: http://www.winesur.com/top-news-2/%E2%80%9Cdifferentiation-is-key%E2%80%9D-2
Aldo Biondolillo – General Manager of Tempus Alba
