ORANGE RIVER CELLARS

ORANGE RIVER CELLARS

Taking the wine industry in a new direction

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Stellar

Cellars Looking to expand both its product portfolio and continental reach, Orange River Cellars is approaching Africa’s wine industry in a new and innovative way Writer: Jonathan Dyble | Project Manager: Lewis Bush

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ccording to statistics from the International Organisation of Vine and Wine, South Africa is the seventh biggest wine making country in the world.

Home to more than 95,000 hectares of specifically purposed grape vines, the country produces roughly 10.8 million hectolitres (1.08 trillion litres) per year, an amount 10 times greater than the production capacity of any other nation on the African continent.

Whilst the majority of this is exported, with 107 million litres having been shipped to the UK alone in 2016, there is reason for optimism in the domestic consumer market, with wine on the up in South Africa.

The 450 million litres that were consumed across South Africa last year is a distinct rise from the 425 million litres recorded in 2015, largely driven by the rising interest of younger demographics – an interest that local producer Orange River Cellars has successfully peaked.

“The Delush brand that we recently launched, one of our many meticulously marketed brands, has

been specifically developed for wine drinkers between the ages of 18 and 24 with its sweeter taste and lower alcohol content,” explains Charl du Plessis, the Company’s Chief Executive.

“We feel that we’ve made a crucial step in developing a product that the

Charl du Plessis, CEO

younger consumer can identify with in Africa, reflected in our forecasts that suggest we can expect to do five million litres of Delush wines alone in the next financial year.”

Understanding opportunity

With Delush standing as just one of a number of brands that have been specifically tailored to a host of different demographics, Orange River Cellars currently produces around 55 million litres of wine and up to 10 million litres of concentrate across its five wine cellars per year.

In the 53 years since its inception, the Company has grown to become a major player positioned at the forefront of South Africa’s expansive wine industry, a rise that has been facilitated by the firm’s willingness to adapt.

Du Plessis explains: “In the past few years we’ve become a lot more consumer orientated. We used to be a bulk orientated Company producing wine for distillation purposes.

However, we have had to change our approach as we didn’t have a captive market in the wake of deregulation.”

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www.ort.co.za

The radical better way of transport

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Orange River Cellars is contemplating investment in new facilities

The firm has faced a significant number of structural and cultivationcentric challenges in face of this, most of which have been overcome by its savvy marketing strategy and flexible attitude.

“In my eyes, our commitment to market research and productive innovation have been key to our success to date,” says du Plessis.

“We’ve continually explored focus group and brand development exercises to help us better tailor our products to the demands of the consumer, finding out what it should look like, taste like and be like.

“I think we started a bit too late and it has been tough catching up. We’ve got competition in the market that has been established for some time, but we’re definitely making a name for ourselves.”

This is particularly evident when considering the Company’s recent diversification, not only through the

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ince 1981 Orange River Tankers has been transporting bulk wines, grape juices and related pulped food products from the Northern to Western Cape. Our commitment to our vision “To be a world class bulk tanker transport specialist” is imbedded in excellent service levels and an ISO22000 quality management system to assist with continuous improvement.

Orange River Tankers has been serving the agriculture industry for the past 37 years, transporting wines to the consumers in the bigger cities and more recently transporting grapes from the farmer’s vineyards to the local cellars.

During 2005 the business founder, WHC Barnard retired and Orange River Cellars acquired this logistics company as a strategic asset, due to the synergy between the two organizations. A passionate dynamic management team, the growth in the wine and alcoholic beverages industry and the critical volumes of Orange River Cellars allowed Orange River Tankers to expand operations in the Western Cape. A new depot in Black Heath, with a well-equipped wash bay was opened during 2012. This facility enabled us to further improve our service levels and grow our market share in the alcoholic beverages industry, with loads routing to the north.

With the majority of consumers in the Gauteng region and South Africa being the gateway into Africa, progression to the north was a natural process. In our efforts to diversify without losing focus as a bulk tankers transport specialist, we exploited the opportunity by utilising our current fleet for the transportation of pulped plant oils and molasses into SADC African countries.

With climate changes and the resent droughts in the Western Cape, this new endeavour opened an innovative opportunity to expand our services to the agriculture industry.

During 2017 Orange River Tankers opened a new state-of-the-art depot with a well-equipped workshop and wash bay in Heidelberg, Gauteng. The Heidelberg depot supports the gross border fleet and the additional branch ensures excellent customer service in the Gauteng region.

Our new tautliner and fuel tanker divisions serve customers in niche markets across the country. This new branch and divisions are part of our growth strategy and our unique value proposition to our customers. We offer “the radical better way of transport.”

The current economic climate and the resent droughts in the Western Cape wine region challenged us to further improve our business model through innovation, to reduce fuel and maintenance expenses, minimise down time and improve payload.

We are firm believers that people are the most important denominator between good and great organisations and at Orange River Tankers refining our people, is a constant and ongoing process. If you align your business with market forces, customers’ needs and strong long-term business relationships, success will follow you.

www.ort.co.za

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BLASTCO INDUSTRIAL SERVICES

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lastco Industrial Services is extremely proud to be associated with Orange River Cellars. We specialise in refurbishment of concrete and mild steel wine tanks between 10,000 litres to one million litres. We construct floors, do waterproofing of cellars and use epoxy specifically designed for the industry.

The Company has an experienced workforce equipped with safe equipment and internationally certified products. We have successfully completed several projects at Orange River Cellars as part of a long-term maintenance programme.

The Company strives to render outstanding services to our valued customers.

Back, left to right: Eduard Mostert (CFO), Koos Visser (Marketing Manager) Front, left to right: Auret Nagel (HR), Altus Theron (CPO), Charl du Plessis (CEO)

Delush brand that is growing at around seven-10 percent each month, but also in its recent purchase of a raisin processor.

“We have made the transition into being a food and beverage business,” du Plessis adds.

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www.blastco.co.za

LIQUI-BOX SOUTH AFRICA

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iqui-Box South Africa, a flexible packaging supplier with 15 years’ experience in the local SA bag-inbox market, offers unique bag-in-box solutions, patented fitments and filling machines to the industry.

Broadening horizons

The business is in fact exploring a range of new opportunities, from the consideration of launching bottling facilities in Zimbabwe and Johannesburg, to refining its supply chain management in the aim of better dealing with the growing complexities that have come with its expanding operational scale.

And while such diversification can be considered crucial to the continual success of Orange River Cellars, so too is its broad outlook when approaching new markets.

Currently the firm exports to Nigeria, Kenya, Ghana, Malawi, Tanzania, Namibia, Angola, Botswana,

T +27 74 224 6840 E Stefan.dutoit@blastco.co.za E Johann.dutoit@blastco.co.za

Drawing focus and support from Liqui-Box Global, a bag-in-box focussed organisation with manufacturing facilities worldwide, we are uniquely positioned to provide risk free holistic solutions for any bag-in-box requirement.

Being on the forefront of packaging innovation, with our core values of safety, passion, integrity, people and teamwork - we work together with each customer, understanding their individual needs, to build lasting relationships through service, quality and innovation.

Liqui-Box. Connect. Design. Deliver.

Jopie Faul - winemaker at our Upington Cellar

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www.liquibox.com

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Providing client specific solutions of outstanding quality

T: +27 74 224 6840 | E: Stefan.dutoit@blastco.co.za / Johann.dutoit@blastco.co.za | www.blastco.co.za

FRESH NEW WINE PACKAGING SOLUTIONS Our bag-in-box solutions keep your wine and spirits fresh longer, allowing your customers to enjoy your products the way you intended. Discover advanced wine packaging solutions from Liqui-Box.

Liqui-Box South Africa 23 Reen Avenue Athlone Industria 1 Athlone, 7764 Cape Town, South Africa Phone: +27 (21) 699 1920 Mobile: +27 (0)67 059 0868

www.Liquibox.com

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Zimbabwe, Mozambique, New Zealand, China, Europe, and other regions, a portfolio that is testament to the Company’s ability to be flexible where necessary.

“I think the key things for us when moving into new markets is aligning our products’ value proposition with local expectations,” explains du Plessis.

“In the main, we’re not delivering boutique wines. We know what we’re good at and that’s offering big volumes under strong consumer brands with high turnover.

“From an infrastructure perspective, we know we’re in a position where we are able to deliver good quality products on a consistent basis in South Africa.

The trick now, is establishing our brands across the rest of the continent.”

The opportunity to execute this is particularly prevalent in African countries situated in the southern hemisphere – opportunities that

Orange River Cellars readily looks to capitalise on through the pursuit of local partnerships and joint ventures in those countries that it exports to.

Upholding Upington

Based in Upington, South Africa, Orange River Cellars is located in one of the most remote regions in the country, situated more than 900 kilometres drive from Cape Town, Johannesburg and Windhoek, Namibia.

Naturally, the Company struggles to attract talent as a result – an issue that has led the firm to introducing a bursary scheme in the aim of securing talented employees, particularly within its internal consultancy department.

“I very much believe in developing our people, not just from a Company perspective but as an individual,” du Plessis reveals. “In doing this, we put some of the strong performers on programmes to help develop them on all levels.

MPACT CORRUGATED

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pact Corrugated, one of South Africa’s leading corrugated converters, is proud to be a business partner with Orange River Cellars All packaging is custom-made to specific customer. We have developed our leading market position by focusing on investments in modern technology and training, customer relationship management and a decentralised operating structure to provide constant improvements to the products we supply.

Our customers include producers of agricultural, fast moving consumer goods (FMCG) and other durable and non-durable goods that use packaging primarily for the protection of products in transit and for point-of-sale display.

www.mpact.co.za

“...people are highly important to the success of our business, so I like to be rigorous with both recruitment and training”

Thousands of hectares of vineyards decorate the countryside in immediate proximity to the Orange River

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“In our case, I think people are highly important to the success of our business, so I like to be rigorous with both recruitment and training.”

Further, in the face of these geostrategic limitations, du Plessis recognises the important role that the Company plays in the local community, readily giving back through a multitude of different initiatives and committing 1.5 percent of its annual turnover to CSR practices.

“We are very remote, and that creates a lot of challenges for the local peoples,” he states.

Orange River Cellars helps to maintain and upkeep local schools that otherwise struggle with funding, whilst it also works with the police to help reduce the overall social impact of the business.

“Alcohol in such environments can be a very sensitive thing and can lead to a lot of problems, so we know that we have to step up to the plate and help to stem that,” du Plessis adds. “It’s not

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that easy, as there’s a natural conflict between this and trying to grow our product, but we like to try and help local institutions in addressing the existing social imbalances where possible.”

The next genesis

These encompassing attitudes are reflected in one of Orange River Cellar’s major goals for the year ahead.

“The very clear target we have for the next 12 months is to improve the returns to our growers, giving them a more sustainable income, especially relative to some of the other agricultural practices in the irrigation scheme, such as raisin cultivation,” says du Plessis.

Meanwhile, looking ahead internally, the Company is continually hoping to

better incorporate the desires of its customers in order to remain ahead of the curve, through its emphasis on both product innovation and diversification.

Du Plessis concludes: “In my eyes, our next genesis is considering that, yes, we’ve been successful in opening up market segments, such as the young African demographic. But now we need to give them new products to maintain this trend, such as a wine style for the drier tasting pallet.

“Equally, now that we’ve purchased our raisin processor, the next two years will largely be geared towards getting that off the ground and ensuring it is successful. Thereafter we can look to seek out alternative opportunities.”

Orange River Cellars Tel: +27 54 337 8800 info@orangeriverwines.com https://orangeriverwines.com

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32 Industria Road, Upington, Northern Cape, South Africa 8800 Tel: +27 54 337 8800 info@orangeriverwines.com https://orangeriverwines.com/

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