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How lockdown gave Chilean wineries a new audience

Chile’s winemakers found a loyal customer base on their own doorsteps during the country’s lockdown.

Maipo, Chile - Santa Rita
Maipo, Chile – Santa Rita

Chile is traditionally one of the largest wine exporting nations in the world, and ships roughly 70% of its produce to restaurants and retailers overseas. Estates, on the whole, have also been rather fortunate during lockdown. The country’s wine industry was able to harvest “under normal conditions”, with agricultural businesses given special dispensation to operate after Chile’s lockdown came into effect on 18 March. Vineyard teams had to work quickly in case the rules changed again, but thankfully, the unusually warm, dry harvest meant  lower yields and faster ripening across all varieties, which speeded things up.

Meanwhile, sales channels remained relatively open. On-trade venues shut down for months on end, but supermarkets, where 82% of Chilean wine is sold in the UK, were struggling to keep up with soaring demand.

That said, all businesses had their own challenges. Some wineries do sell more bottles in restaurants. Others, particularly smaller estates without hefty marketing budgets, found their wines were being passed up on shelves in favour of better known brands.

“What we learned with this is to have fewer links in the supply chain”, Eugenio Lira, the head winemaker of Apalta-based Las Niñas winery, said.

“If you have too many people in the supply chain, it brings the price up.” Foreign shoppers, Lira said, are less likely to pay a premium for wines they’ve not seen before than they would be at a restaurant. “They don’t know the winery, and it’s not as cheap as they’d like to for a new winery.”

Instead, estate owners looked around them, and found a market on their doorstep.

“People were drinking a lot more during lockdown,” Lira laughed.

Brands like Tarapaca were already set up to supply supermarkets in Chile, but not everyone found the transition easy. Supplying housebound Chileans came with its own challenges. Couriers, Lira said.

The Las Niñas winery is owned by three French veterans of the industry all of which are still based in their homeland, including Bernard Dauré, the proprietor of Chateau de Jau, near Perpignan, in Rousillon. This means Las Niñas’ website is actually set up and run from France, so transforming it into an e-commerce platform wasn’t really an option while there were so many other things to look after. Instead, Lira found himself taking orders through Instagram direct messages. Staff all chipped in with the groundwork while they looked for a reliable (and affordable) courier. Lira mentioned he had to deliver a case of wine to a customer in Santiago after our interview.

He believes the winery will “continue this new way of close contact” with local consumers long after things go back to some sense of normality. For one thing, it makes sense to nurture a relationship with consumers you can rely on when half of your business is disrupted, but also, Lira said he can sell the wines cheaper.

While export and close ties with importers will remain a core part of the business, Lira said Las Niñas’ owners are “working on the chain to be more accessible”.

Some Chilean producers, particularly those that sell the majority of their wine through supermarkets and other retailers, have done very well out of lockdown. Sebastien Ruiz of Viña Tarapaca, which sells 40% of its wine in Chile, reports that more locals have been buying his employers’ bottles over the course of lockdown. Pablo Sprohnleln, lead winemaker at Santiago-headquartered Viña Via, said he expects to sell 30,000 more cases than originally planned by the end of the year. Up to 100,000 of those, or just under a quarter, are destined for the domestic market.

“Here in Chile we’re selling probably twice as much wine as we were projecting for the year,” he said.

Selling locally may become more of a priority for some as the year progresses, largely because of the lack of movement in the restaurant sector and ongoing travel restrictions. Lira said some markets where Las Niñas already has a long-standing relationship with distributors will be fine, but new business is not there. Orders are being pushed back into 2021, making it difficult to plan.

“It’s very hard for us to get another purchase order from someone who bought it in March. The European summer has been weird so they still have stock, and especially China because they did’t have New Year.”

“They were saying after the summer they will order, but now I’m contacting them and they’re saying maybe not yet, maybe January because they still have stock.”

“Every year in September i go to Paris to taste with our distributor there, but obviously I’m not going because I’d have to quarantine either way. That business that is decided in August or September won’t be done, but it might be done in December for the next year.”

Nonetheless, Lira’s optimistic.

“We’re still having a great time. I hope in 2021 all this will pass and people will be more interactive. Chile is showing we’re not just one kind of wine, and we have to keep showing that.”

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