News

INTERVIEW: Philippe Baijot – All in his stride

04 June 2007 By db staff writer

“standfirst”>Never losing sight of the “specialness” of Champagne, Philippe Baijot has built up one of the region’s most formidable groups with his business partner and confidant, Bruno Paillard

He tells Charlotte Hey that the acquisition of Lanson has been the icing on the gateau.

For Philippe Baijot Champagne is a passion. Not just the product but also the business. It must be, otherwise he wouldn’t have become CEO of the region’s second largest group, Boizel Chanoine Champagne. He freely admits that he “started with nothing”, having discovered Champagne when he studied at the business school in Reims. Today, with his business partner Bruno Paillard, this tall, gentle man oversees a company comprising seven core Champagne brands and various BOB brands, generating revenue of E311.31 million in 2006.

Until now Baijot has spent little time in the glare of publicity, but his takeover of the former Marne et Champagne, home to the Lanson, Besserat de Bellefon and other brands, with Paillard in March 2006 has forced him into the limelight.

On first meeting Baijot you could be forgiven for thinking he is unassuming. A few moments in his company, however, and you realise that his presence, determination and not a little focus have brought him to where he is today. His illustrious yet, until now, uncharted career in the Champagne industry came about more by chance than design. But more of that later.

Baijot comes from a sales background, having started his career working for Gaston Burtin in 1976, a pretty important year, as it turns out, when he also met Paillard. Apparently their 30-year business association started over dinner one night in Reims. “We are very different but everything we do, we do together. Every decision we make, we make together,” says Baijot. “It’s got to the stage that we almost have a sixth sense between us, we know how each other thinks. We are friends, and when it comes to business we have each other’s best interests at heart,” he reveals.

“But before we really started to work together my working life started with M. Burtin. He was looking for someone in sales, I got the job and I have to say I was very privileged to work for him between 1976 and 1990. He was a man who had a keen nose for business and I learnt a lot from him, lessons that are still relevant for me today.”

During his time with Burtin, Baijot launched the Alfred Rothschild brand. “I suppose you could say I was hired for that purpose,” he jests. He obviously worked hard at it because today the brand, created solely for the multiple grocer market, is still one of the biggest sellers by volume in France.

It seems that with the growth of the Rothschild brand Baijot grew close to his boss and when Burtin finally retired on his 90th birthday, Baijot was party to the news that the business was being left to a relative of Burtin’s wife. The closeness between the two men allowed for a frankness that Baijot freely admits to. “I was quite open with him at the time,” says Baijot, “I told him I thought it was a bad idea to go down that route. He disagreed, I resigned.”

Going it alone
But, as often happens in life, as one door closes another one opens. “Around the same time Bruno had left his father’s business to go it alone,” says Baijot. “He told me that his father was looking to sell his business. We met up, I told Bruno’s father I wanted to buy his rather good brokerage business, we agreed a price,” he laughs. “I went to the bank; that was January 1991. I was master of my own destiny.” He makes it sounds simple, but little did he know that so much more was to come; only two months later in fact.

“Bruno and I met for dinner and he floated the idea that we should go into business together and buy a real Champagne business, not just a brokerage company but one where we could grow, produce and sell Champagne. The problem I faced was that I had just bought Bruno’s father’s business. I was already in up to my ears but for some reason I thought ‘Why not?’ We talked to the bank, got the funding and bought Chanoine Champagnes et Grands Vins.”

The formation of this formidable twosome unfortunately coincided with the economic depression of the early ‘90s. In short, in order to survive they had their work cut out.

Again, Baijot makes it all sound rather easy. “I had experience in selling to big supermarkets, we had the facility to make whatever the market demanded, so we started to buy grapes and quickly we realised that we had the ability to sell quite a lot, our business was up and running.”

At the end of 1994 news came to Baijot and Paillard that the Boizel family business was for sale. “We saw an opportunity and seized it by investing in 54% of the company. By raising capital against the remaining 46% we were able to become partners with the Boizel family. They had a lot of stock and we were able to sell off excess bottles at the best price, which in turn enabled us to release funds to re-invest in the business.”

Baijot had gathered a certain amount of momentum by this stage in his career and in 1996 the company bought Champagne Philipponat, “including the Clos des Goisses”, beams Baijot. “Imagine that! The Clos des Goisses, what a jewel. And we started to build the new Chanoine facility in order to concentrate our production,” he adds.

In 1998 the Champagne de Venoge brand along with part of the bottle stock was purchased. “But that left us short of grapes,” Baijot admits. “So we started to look for another strategic purchase and Alexandre Bonnet became available. With 43 hectares of vineyard, the company fitted well into the portfolio. It is very important for the company to this day because of the stocks facility it allows us.”

Growing pains
In just eight short years they had managed to build a small- to medium-sized group of very complementary Champagne brands, and during a period of adversity in the region’s history. According to Baijot, at that point the company was profitable at every level: “We had a good spread across every segment of the business. We had a group of solid, well-positioned niche brands. But,” he says, “not a really big brand.”

They had paid back all of the debt they owed when an opportunity presented itself. “In November 2005 we heard that Marne et Champagne was for sale. Our business was good. This was the big chance. A very big chance. But there was something about the Marne et Champagne deal that frightened me.” As Baijot continues with the story it soon becomes apparent why he found the deal a bit worrying.

“One of the problems that we face in Champagne at the moment is the great shortage of grapes – if you are a dynamic company you have to be frustrated by the situation. The ‘05 harvest left us very short. To be honest, we are always short. Marne had the contracts. It was scary but a logical move if we wanted to continue to grow the business. Bruno and I talked about it. I expressed my fears but something told me it was the right deal to go for. Bruno cautioned me, I remember he said ‘Be careful, if we decide to do it we really will do it.’”

And so it was that after much negotiation, much consternation within the region and not a little risk, Baijot came back to Marne et Champagne 15 years after he had left. The decision for him was natural: “I was obliged to take the reins.” On the March 22, 2006, Paillard and Baijot signed on the dotted line. The big brand they had craved was theirs. But the months up to the signing had been fraught with difficulty. Baijot’s fears about the company were based on an intrinsic issue that would make or break the deal and their plans – the workforce.

“Many people told us we were crazy at the time, especially because of the situation with the trade unions. Our first problem was we had to deal with the people who were going to work for us. It was at that point that we realised that the previous management were not made for the job of running a company of that size.”

Baijot’s work had begun and he admits he had never worked so hard in his life, perhaps because so much was at stake. “I talked to the work force; to the people. I told them that while we could talk to the banks and the growers, in order to sort out the issues we faced we had to work together.

“At the time we were looking to buy the company it had a 31-hour week; we put that up to 35 hours in order to make the company viable. We had to strike the deal between the trade unions and ourselves. It took three months of negotiation during which time the trade unions tried to strike but the members would not follow their recommendation. What I had to do was to convince them that I respected them. That was the only way they would respect me and trust me as a man of my word.”

Baijot’s powers of persuasion must have worked. He believes that, as a consequence, the working environment within Champagne Lanson has changed dramatically in the past nine months, culminating in a bonus for the whole workforce at the end of the company’s last fiscal year. “The first time that has happened since 1999,” he smiles. “There is still a lot to do, however.”

Méthode traditionelle

The experience that Baijot had acquired over his years in the business gave him a real sense of what Champagne means to the consumer and, with Champagne Lanson, what that brand should mean and where it should be. “When you speak to people about Lanson you start to see how strong the brand is, we have an opportunity to maximise that strength.” He continues, “We have been through a period of internal restructuring, now we have to concentrate on the brand, we are going to be doing a lot of above-the-line activity.

“In terms of the brand we are returning to the former label and collar for Black – going back to our more traditional design cues. We are also returning to the red label for the vintage. I want to show that this brand has heritage, the red label is a big part of the history of Lanson. Why use gold for vintage? I have no idea.”

For Baijot it’s about presentation, maximising the essence of Champagne and the occasion of drinking it. “Its specialness,” he beams, his enthusiasm bubbling under the surface. “At Lanson we have a vineyard, the only vineyard in the centre of Reims – right in the middle of Lanson. One hectare. That’s 18,500 bottles. We’ve just bought the casks and the winemaker is delighted by the prospect of making something very special.”

His passion for the brand, indeed for all of his brands, is palpable. His openness and honesty about his career is at times disarming. And this perhaps is what has brought him so far, from his start in the industry as a salesman for a new brand. Cut him and he might conceivably bleed Champagne.

But Champagne was not what he intended to spend his life selling when he went to business school in Reims. “I wanted to be a vet,” he admits. “I went travelling with my brother, during the summer immediately after we finished school. For one reason or another we got back home late. I’d missed the date for enrolment at veterinary school. My father, a strict man, said, ‘I’m not having you sitting around for a year, I’ve enrolled you in business school in Reims.’ I did what he said.” Baijot’s life could have been very different if it weren’t for what seems to have been too good a holiday in the summer of 1968.

He smiles whimsically, “I think I’ve only ever told my wife that story.” And perhaps Bruno Paillard.

Vital Statistics

Boizel Chanoine Champagne fully owns seven Champagne houses:

Champagne Boizel – French mail order market leader, distributed in the traditional sector for international markets
Champagne Chanoine Frères – intended primarly for the mass retail market, notablywith the Tsarine brand
Champagne Philipponnat – which owns Clos des Goisses
Champagne de Venoge – with a new Louis XV vintage launched recently
Champagne Alexandre Bonnet – owner of a vast vineyard, which has acquired the small Ferdinand Bonnet brand
Maison Burtin – a mass retail supplier and owner of the Besserat de Bellefon brand
Champagne Lanson – the prestigious international brand