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CLOSURES UPDATE: Creating a dialogue

“standfirst”>Fed up with hearing about TCA? So, it appears, are most retailers. Fionnuala Synnott discovers that it takes more than science for closures manufacturers to win UK retailers’ custom

With all the fuss about TCA, reduction and oxidation, not to mention coverage of the potential health consequences of certain types of screwcap liners, the bottom line is often forgotten in the closures debate. But one of the most important things that a closures producer can do in order to guarantee its survival in a crowded, competitive market is engage in a dialogue with the retailer.

Retail policy
Although a variety of guidelines exist for closures manufacturers, so far, there is no global, industry-wide test that can be applied to all types of closures. In lieu of a comprehensive international standard, many UK retailers have put in place a closures policy of their own. As Chris Gibson, technical manager BWS for the Thresher Group, puts it, at its most basic, the retailer “expects the closure to ensure that the wine reaches the customer in optimum condition”.

Fiona Reith, a key account manager at United Closures and Plastics, also thinks most retailers’ needs are fairly simple: “The bottle has to be easy to open, not leak, be easy to store and easy to handle.” The impact on the end consumer is also paramount.

Dean Bannister, sales director at Oeneo, makers of DIAM, explains: “Retailers want a closure that doesn’t have TCA and doesn’t adversely affect the wine in order to limit returns from consumers, who they want to satisfy.”

Of course quality, consistency and hygiene are top of retailers’ lists but consistency of supply is also vital to any multiple grocer, particularly in the price-driven UK market, where the popularity of promotions often leads to surges in demand. Price is also an issue when it comes to wine packaging. “There is a drive to take cost out, which leads to simplification of the packaging, although some retailers like the closure to be decorative to make the presentation more interesting to the consumer,” says Reith.

And then there are the regulatory requirements. According to Geneviève Janssen, marketing manager at Nomacorc, traceability (related to food safety) is vital, as is the need to meet the requirements of EU regulations, which vary by market: the British Retail Consortium in the UK, the International Food Standards guidelines in Germany, the ISO in France and HACCP regulations in all markets.

Of course, some retailers have their own labels so they are closely involved in all of the key quality testing and purchase decisions associated with choosing the closure best suited to their wines, brand image, price point and/or geographic market. Sue Daniels, wine technician at Marks & Spencer, explains: “We’re in a unique position in that everything that we sell under the umbrella of our brand is done exclusively for us. We can set the standard in every type of wine. We don’t have a global closures policy as we try to work with the winery to find the best closure for the specific wine.”

Andrew Shaw, Waitrose wine buyer for Italy, South Africa, Bordeaux and Germany, prefers to be led by the supplier and not be too prescriptive: “The advantages and disadvantages for almost all types of closures can be argued successfully within different sectors and markets so our tendency is to let the supplier present what they feel is the best closure and not to dictate too much. Closures are an integral part of the packaging, and  often clearly represent the intent and ambition of the wine producer.”

Anne Seznec at Guala Closures also believes that individuality is important and that standing out from the crowd is the real key to catching the retailer’s eye. “In a market that is driven by price, retailers are looking to suppliers to bring innovation to the category. The route to success for closures manufacturers is to answer retailers’ expectations through a good mix of design and innovation, in order to stand out with a commoditised closures business.”

Although closures commentators may take a perverse pleasure in debating the relative merits of one closure over another, as far as the retailer is concerned the scientific debate is over.

Amorim marketing and communications director, Carlos De Jesus, explains: “Retailers have now realised that, rather than criticising the material, it is more productive to criticise the application of the material.” Seznec agrees: “As far as the retailer is concerned, the scientific debate is behind us. The focus is now on practicality.”

Nowadays, the real debate is about the wine and how it develops after bottling. Oeneo’s Bannister explains: “The current challenge is about matching the wine style to the closure as the same wine evolves very differently under different closures.”

Joyce Steers-Greget, global marketing manager at Supreme Corq, adds: “Producers need to match the proper closure with the needs of their wine and winemaking style as well as the expectations of their target consumer.”

In practice, this means ensuring that the closure has the right level of permeability to avoid any risk of oxidation or reduction, that the closure is easy for consumers to extract and re-insert, and that “it is consistent with the price point and product values of the wine”. Katrien Vandenbroucke, external sales, Vinova, adds: “More thorough testing needs to be done on all  different types of closures, especially in the field of OTR (oxygen transmission rates). Together with the sensoric characteristics of the closure material, it is OTR which determines the organoleptical evolution of wines in the medium and long term.”

Mark Coleman, director of global business development for Neocork, thinks manufacturers’ priority should be meeting the winery’s demands first rather than the retailer’s. “Closure producers must first meet the individual winery or bottling company’s criteria of bottling line performance, wine quality, appearance, consumer friendliness and cost. Even if a particular retailer prefers a particular closure, it will not be a great benefit to the wine, the winery or the consumer if that closure doesn’t accommodate that winery’s bottling line, bottles, wine type, or cost requirements.”

Measuring closure footprints

Although the consumer trend for all things green doesn’t appear to have filtered through to wine just yet, the trade is bracing itself for an increase in interest. In fact, Carlos De Jesus, marketing and communications director for Amorim, thinks that sustainability issues are so important that he refers to retailers’ financial, social and environmental priorities as the “triple bottom line”.

Meanwhile, Chris Gibson, technical manager BWS, Thresher Group, predicts that the possibility of recycling the closure will be given more prominence by retailers. “It won’t be long before someone compares the carbon footprints of different closures, if they haven’t already.”

In fact, this is already happening at Marks & Spencer, which declared its aim to be carbon neutral by 2012 earlier on this year. Sue Daniels, wine technologist, explains: “We’re looking at the environmental concerns associated with different types of closures and are currently working on an internal project comparing the carbon footprint of different closures.”

Growing environmental concern among retailers has led to the beginnings of a domino effect in the closures industry. Dean Bannister, sales director, Oeneo, observes: “Tesco, M&S and Sainsbury’s have made a lot of noise about their carbon footprint. Although this is not a direct closure issue, as a result of those statements we have commissioned a study of our carbon footprint from the Cairn Environment Agency.” This report had been ratified by the French Environmental Agency at the time of going to press, but research findings were not yet available.

The research process
But given how complex the technologies behind bottle closures are, and how quickly they evolve, it is difficult for retailers to set the parameters without some help from closures manufacturers. De Jesus says: “Retailers have well-established closures policies. We help them to establish these policies and identify what is right from a price point perspective. We can sometimes save them money by working with in-house technology.”

Neocork’s Coleman also sees closure selection as a joint effort. “In our experience, many retailers will either rely on their own historical experience of wines sold with a particular closure and customer feedback or they will rely on experience from their key wine suppliers or bottlers.” M&S’s Daniels views the process as a tri-partnership between the closures manufacturer, the winery, the retailer and sometimes the bottler as she feels it is important to work with everybody. M&S carries out internal tastings but the analytical tests are done in conjunction with the winery. Daniels explains: “When we commission studies from external laboratories, we tend to do it in conjunction with the closures manufacturer as we prefer to bring them on board at the beginning rather than impose a decision on them later on.”

Thresher’s Gibson thinks independent research is vital: “Closure suppliers are here to sell a product and will always put the most positive ‘spin’ they can on their product and its performance – that’s only natural.” It is therefore preferable for any research and advice to be independent and come from recognised bodies such as the AWRI or the Geisenheim Research Centre. “When setting a standard you have to consider a range of sources of research and I always consider what the supplier puts forward as part of the mix. It’s also important to consider the wineries’ expertise and experience as this can be very useful,” he adds.

Multiples such as Tesco and Sainsbury’s will not take closure manufacturer research at face value. Nomacorc’s Janssen explains: “As a closures manufacturer, you have to prove that your product’s technical performance is supported by independent research from institutions such as the AWRI.”

Setting standards

A number of closures manufacturers, particularly those that are relatively new to the market, have complained that some UK retailers, particularly in the multiple grocer sector, operate exclusivity arrangements with their closure suppliers, dealing solely with one brand in each closure category. A drinks business source, who prefers to remain anonymous, says that in a worst case scenario this means that certain supermarkets are not open to new closures, sometimes refusing even to test the  technology. If this is true, it means the closure playing field is far from level and has worrying implications for both wineries and end consumers, who may be deprived of the advantages offered by new technology. 

However, this is not the case with all UK retailers. At M&S, Daniels prefers to look at the pros and cons of each individual closure, even if it is time consuming. “Generally, competition is healthy. If you go down the route of a sole supplier it can stifle the business.”

According to Gibson, even though the industry leaders are delivering ever better results there is still a second tier of suppliers whose closures aren’t what they should be. “Ultimately I think that if retailers and wine producers remain vigilant the lesser suppliers will have to either improve the quality of their product or disappear.” 

Given that some retailers are more stringent than others and that not all closures manufacturers operate the same level of quality control, there may be an argument for an industry-wide, standard closures test. Coleman thinks there is, with a caveat: “The industry would first have to work together to identify what the ‘standard’ is because there are so many variables in regards to bottle type, bore dimensions, bottling lines, wine types and storage environments that what works well for wine may not necessarily be the best for another winery.”

Gibson feels that an industry-wide standard and test would be useful but thinks it would be “prohibitively difficult” to implement. “If we did have one it would certainly aid decision-making and product comparison and ultimately drive overall quality up. I know some bodies are working towards general guides, which is to be welcomed.” One such body is The Natural Cork User Group (NCUG), which is composed of interested parties from the cork industry, retailers and the wine industry. The group has just approved the release of the Buying Guide for Corks for Still Wines, which it has been working on for over two years.

A global standard would also be difficult to implement on a technical level as there is much debate about which testing methods are suitable to use, given the different types of closures. Supreme Corq’s Steers-Greget observes: “A Mocon oxygen transmission test is an accurate way to measure oxygen transmission for a synthetic closure but it’s not suitable for testing a tree bark cork because the cork must be kept uniformly wet to provide accurate results.”

An industry-wide closures test would also enhance competition in the closures industry.  “It would give all manufacturers of good quality closures the same chances to become ‘approved suppliers’  and these results could serve as a guideline with objective, technical product information for purchasers and wine producers,” says Vinova’s Vandenbroucke.

In Reith’s opinion, an international standard would protect the end user as well as the credibility of the key players, while Dave Pahl, vice president of sales and marketing at Zork, thinks that an internationally recognised standard would be good for everyone: “If all manufacturers were to undertake and meet the standard levels of performance as dictated by the industry-approved tests, it could only build confidence within the retail sector that the selected closure will not negatively impact performance of the final product – enjoyment of wine!”

The scientific debate as we know it may be behind us but in most cases, it is still down to individual closures producers to discover what retailers want. Oeneo’s Bannister observes: “In many ways, retailers haven’t been forthcoming in terms of making a statement about what they want from closures. It’s down to us to work it out and find out what the next big issue will be.” Daniels has one last word of advice for the closures community: “The way for manufacturers to better answer retailers’ needs is by thinking about the things that concern the end customer as this is what concerns retailers.”

© db­ August 2007

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