Massmart provides export opportunities to developing wine brands
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This year Massmart will incentivise the best performing wine producers from its Developing Wine Brand Programme, a component of its Supplier Development Fund (SSDF), with export opportunities to Walmart’s key international markets.
This follows the successful entry of King Goodwill Zwelithini’s royal brand Bayede! Wines and the popular Seven Sisters’ into Walmart stores in China and the USS respectively earlier this year. Massmart will be looking for superior quality wines from its wine programme to recommend to Walmart.
The Developing Wine Brands Programme, in partnership with Makro and Cool Wines, aims to fast-track the development of emerging wine producers. It was launched in March 2012 and to date, a total of 116800 bottles of wine have been sold locally under the 19 participating brands.
Massmart’s supplier development manager Moshisi Lehlongwane says the programme reinforces Massmart’s commitment to local suppliers.
“We have learnt so much during the first year and have been able to tweak the offering, which has boosted the programme’s results,” Lehlongwane says. All 19 participating brands are now available in Makro stores countrywide and select Game stores.
A unique opportunity
When Walmart announced its intent to acquire Massmart, Grant Pattison, Massmart’s CEO , saw an unique opportunity to help boost the African economy by sourcing and exporting goods from Africa to Walmart’s various established markets around the world.
Following the successful launch of Seven Sisters wines in 54 Walmart stores in the US at the end of August 2012, Walmart increased its procurement and Seven Sisters is now on the shelves of 300 stores. Bayede! Wines also secured a contract with Walmart and recently shipped about 350000 bottles of wine to China.
Route to market
At first, the participants benefitted from consulting advice on elements such as competitor and customer analysis, packaging, pricing and brand development. But soon it became clear that one of the biggest challenges lay in logistics. Massmart now provides logistical support, with the help of Cool Wines, to get the wine from the farm to their stores.
“We aim to achieve this by providing a route to market for our participating brands, mainly through Makro and other liquor chains in Massmart; we also assist with distribution, in-store marketing, promotional support and training,” Makro’s national wine buyer Carolyn Barton says.
In addition, Makro provides free advertising exposure and in-store promotional activity (excluding provision of the wine). Participants attend frequent meetings with Makro to evaluate sales and brand development progress with the objective of developing joint solutions where appropriate.
To further support the participating brands’ public exposure, this month, the supplier development programme funded travel, accommodation, and exhibition stands and sample stock for tastings at the 9th annual Soweto Wine Festival, taking place from5-7 September. The festival attracts 8500 wine buyers, agents and enthusiasts each year, a fitting platform for the brands to tell their unique stories and build brand awareness.
Walmart: Why Seven Sisters?
Jason Fremstad, the Senior Buyer for Wine and Spirits at Walmart, was sent to review wines from South Africa for incorporation into their product line-up. Initially nine wine brands were brought to the table because they met the strategic criteria of the sourcing team. Seven Sisters topped the ranking at the end.
According to Fremstad, their wines had several factors in their favour: First, the style of their wines was in line with what Walmart customers are looking for: easy and soft to drink, regardless of the varietal. Second, the label has been designed to grab the customer’s attention while delivering a deeper story once the customer has picked it up off the shelf to read it. Finally, he noted how the prices fitted into a range which appealed to Walmart customers.
Wines currently participating in the programme:
• Bayede! Wines
• Cape Dreams
• Thandi Wines
• Libby’s Pride
• Thembi& Co
• House of Mandela
• The Food & Wine Factory
• Remogo Wines
• Women in Wine
• Seven Sisters
• Bosman‐De Bos
• Solms Delta
• Howard Booysen
About Massmart’s Supplier Development Fund
Massmart has established a Supplier Development Fund to assist developing South African suppliers, in particular, any Small- to Medium-Sized Enterprises, either black-owned, black-empowered, women¬ owned or is a local manufacturer of products. The purpose of the fund is to assist our suppliers in enhancing the quality of their products, thereby improving our procurement and supply chain regime.