Starting up: Three challenges of a joint venture winery in China

– By Alain Leroux

I came to China in 1996 to head the technical side of the joint venture between Bernard Taillan France and Beijing’s Sanyang Group. We have faced many challenges over the past 12 years. Here are three of the biggest in the beginning.

The first challenge was human resources. Initially, we built a bottling room and imported wine from France, to be distributed in China by our sales department and with assistance from our local partner. In 1997, we started importing bulk wine and bottling in China. The problem is that the local staff had little experience and sold wine on consignment. This made it difficult to collect revenue.

We had too many people and an expensive office in the city. In June 2000, the board put me in charge of operations, we stopped the consignment strategy and we drastically reduced our sales staff. Now, we have 15 people, an appropriate number for our activities. We try to focus on the technical side. We have one salesperson and I also try to sell our wine. Many people know our wine by word of mouth.

The second challenge we faced were high sales targets. In the beginning, the proposal was 4 million bottles in annual sales within three years. The third-year sales were to include wine made from our own grapes, with the idea being to plant 1000 hectares. Bernard Taillan France had different ideas about sales strategy. We ended up keeping 20 hectares and continued to experiment with our grapes.

This brings us to the third challenge: equipment. We were growing and experimenting with grapes in small batches, but didn’t have ideal winemaking equipment for this. If you visit wineries in China, most have big tanks capable of handling 60 tons. There are a few exceptions, with some smaller five-ton tanks, such as Dragon Seal, and we made some wine there. Later, my staff and I created a small press. I didn’t buy a crusher / de-stemmer. We did this part by hand, or rather foot, and then did the fermentation in our own tanks.

Previously by Alain Leroux:
Pruning in Beijing: The battle against cold
Small haul in Beijing: Hot moist weather affects production

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