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Exclusive: Massive drinks packing and storage solution emerges at key time for the UK wine trade

While UK bottlers are reaching capacity, a new solution has just opened up for the global wine trade as Accolade’s Bristol-based bottling and warehousing facility goes independent – and with Brexit fast-approaching, it’s just in time, db can exclusively reveal.

The Park packing and warehouse facility in Bristol, UK

Following a tour yesterday of the state-of-the-art site, which became operational from January 2009 following a £100 million investment by Constellation (now Accolade Wines), db was the first publication to be told that the drinks manufacturing, warehousing, and distribution facility (pictured above) is now an independent entity that’s open for business to any company worldwide.

The site was formerly used to bottle and store solely the wines from Accolade, and, although this is the UK’s largest wine company, the facility was running at just 50% capacity – filling around 20m cases annually.

However, from today the facility is being official launched as contract packer for any business in the drinks industry, providing the UK with the capacity to bottle a further 10 million cases of wine, with the flexibility for even more during peak periods – and that’s because even at 30m cases annually, the site is running at 85% capacity.

As part of this move, the bottling plant, which is located by the mouth of the River Severn on the outskirts of Bristol, has changed its name from Accolade Park to just ‘The Park’ to reflect its new independent status.

Furthermore, a new team has been appointed to handle all non-Accolade business that goes through the facility, ensuring that all any wine companies choosing to use the contract packing facility deal entirely with an independent set of personnel.

The ownership structure, however, is still the same, with the facility leased by Accolade Wine’s parent company, private equity business The Carlyle Group, whose CEO apparently said that “the facility is too good not to share.”

The move is of particular importance for the UK wine trade right now, and for a number of reasons.

The first relates to the fact that an increasingly high proportion of wine is coming into the UK as ‘bulk’, meaning that it is shipped in tanks for bottling in the market, rather than at source, with estimates suggesting that more than 40% of all wine arrives into Britain this way.

And, while this figure is rising, the existing set of contract bottlers in the UK, such as Encirc, Greencroft, and Kingsland are either at, or reaching full capacity.

Secondly, a number of current trends are encouraging more players in the wine sector to ship wine in bulk, rather than bottled, particularly in terms of efficiency gains, which will lead to cost savings and a reduction in carbon dioxide emissions – you can fit 2.5 times the amount of wine in a shipping container if it’s stored in a tank, as opposed to a bottle.

Such present developments relate to an urgent need for cost savings in the face a coronavirus-induced economic slump, as well as increasing scrutiny from consumers regarding the environmental implications of transporting wine around the world – the carbon footprint of shipping bulk wine is typically 40% lower than a finished product.

A new name and logo has been created to promote Accolade Park’s fresh status as a contract bottler for wines beyond the Accolade portfolio

But there’s a further key, current reason why the spare capacity of ‘The Park’ is much-needed in the UK right now.

Not only can The Park, as it was rebranded officially on Friday, bottle a further 10m cases with no change to the facility, but it also has indoor temperature controlled storage for an additional 25,000 pallets – representing 2m 9-l cases of wine.

On top of this, the place has space to store as many as 300 shipping containers on site, boosted by further capacity at the Port of Bristol or its nearby rail head should it be necessary.

Such wine storage capacity is key for ensuring an uninterrupted supply of wine into UK retailers during our current Covid-era, when supply chains can become disrupted at short notice due to lockdowns, as well as in advance of Brexit, particularly with the potential for the UK leaving the European Union on 1 January 2021 without a trade deal.

Speaking about the latter issue, general supply manager at The Park, Richard Lloyd, told db yesterday, “Having the capacity is an important differentiator of this facility,” he began.

“We won’t ever run at 100%, and in a seasonal market with promotional spikes and factors such as Covid and Brexit, you need space so you can flex up, and we will always ensure we have spare capacity within our site on an annual basis,” he added.

Continuing he said, “So with the customers we pack for we can deal with the variation in their demand, and that is missing in UK market at the moment.”

By way of example, he said that the coronavirus lockdown in the UK has led to a huge surge in demand through the off-trade, requiring a rapid response from the Bristol facility.

Lloyd recorded, “One week into lockdown this year this site had its biggest ever single day of production – we filled 1.25m bottles in a day, which is testament to this site and its employees.”

Even without such external influences on consumer demand, the volume of wine sold through retailers is notoriously variable, partly due to the high levels sold on promotion – more than 85% of wine is sold in the UK on some form of price offer – and partly due to seasonal factors: for example, December marks one of the wine trade’s busiest trading months, immediately followed by its smallest, exacerbated by the recent development of ‘dry January’.

Meanwhile, looking ahead to impending Brexit, he said, like Covid-19, it could have “a very interesting impact” on the packaging facility.

“Depending on whether tariffs do come in or don’t, it’s still likely that there will be an advantage to bring in wine in bulk form, so we expect demand to increase in the next 12 months,” he said.

While adding that Brexit was not the reason why Accolade had chosen to make its bottling facility an independent contract bottler and storage facility, he said that it will provide a reason for customers to take up the newly-available capacity at the site.

“We believe that customers are looking to switch to UK packing before Brexit happens, which might be for financial reasons because of tariffs or from a sustainable standpoint,” he added.

Speaking about the former he reminded db that should global tariffs come into place for wine on 1 January in the event of a no-deal Brexit, then there will be a lower tariff for moving wine in bulk rather than in cases.

Furthermore, as part of Brexit planning by the wine industry, businesses supplying the UK “will be stock-building from September, and we can store as many as 80,000 pallets on site,” he said.

“However well the planning goes we expect some disruption in January and February, but we have the space here to hold bulk wine around the site, or finished goods in the warehouse, so for drinks packaged here there is no risk [in not being able to supply UK retailers],” he added, before stating, “And other UK packers don’t have the capacity to fill or to warehouse.”

As for his point about sustainability, Lloyd explained, “We are seeing sustainability move up the agenda, it is becoming part of the DNA of customers and consumers.”

He then said, “This facility is carbon neutral and zero waste to landfill, and it is soon to be formally accredited, which means that we can put that on the packaging.”

Finally he told db that the rebrand and change in approach by the facility was being accompanied by a further investment by Accolade’s owners, The Carlyle Group.

“Along with the change in name there is £7m of investment going into the facility over the next six months,” he said.

Almost half of this will be spent on “the latest warehouse facility automation” with 25 robotic vehicles starting in September – and these Toyota machines were already on site when db visited The Park yesterday.

The other half of these monies will be put towards installing a new canning line and carbonation technology for use later this year.

“We are diversifying into other drinks; for example, we believe that hard seltzers are about to explode in the UK following the phenomenon in the US, so we will be able to put a hard seltzer down the line, or a tonic water, even though wine will remain our core business,” he said.

Summing up, he said, “We want to be a one stop shop for customers, which is why we say we are ‘a complete drinks solution’.”

Finally, having shown db the new logo for The Park, which was unveiled to all the facility’s 400 employees on Friday, he said, “Now there is absolute clarity in what we do: we can shout about the fact we are a contract packer.

“We are still still proud to be part of the UK’s largest wine company, but we are now an independent facility, and we are looking for business.”

On this latter point, db was also the first to be told of The Park’s first major new customer, which is Benchmark Drinks, the distributor of celebrity wine brands such Botham Wines, and most recently, a range from Kylie Minogue.

Founder of the business, Paul Schaafsma, who, as former CEO at Accolade Wines knows the facility inside out, told db why he has decided to move his UK-packed wines to The Park.

“I had worked with Richard five years previously – so much of my due diligence had been done: I knew this was the best packing facility in Europe,” he said.

Continuing he commented, “I want to focus my energy on creating brands, so if can partner with someone who can handle logistics, packing and warehousing, then it is taking away a huge component of my infrastructure requirements…. With The Park, we can get everything done from a fulfilment point of view for our brands.”

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