Co-ops prove highly competitive solution

Wine co-operatives have proven to be resilient during recessionary trading as well as successful businesses when the times are good.

Their ability to pool resources and guarantee sales can make them a useful, if not crucial solution for producers both in Europe and elsewhere.

Hence, the drinks business has looked closely the performance of these operations worldwide, in this, the International Year of the Co-operative, according to the United Nations.

Writing in the April edition of the magazine, Elizabeth Gabay MW pointes out that co-operatives produce around 50% of all French wine, and 30% of German, and began to form from 1868 onwards after crises of overproduction and phylloxera, then two world wars.

Although such organisations benefit from being able to control everything from vine to bottle to brand, managing co-operatives is not without its challenges due to the “one member, one vote” system.

However, Elizabeth picks out examples where enthusiastic teams and dynamic managers have transformed co-operatives into successful businesses, such as the modernisation of Domäne Wachau in Austria by Roman Horvath MW in 2005, or turnaround at the Languedoc’s Mont Tauch from 1998.

While she also records an urge among winemakers to leave the co-operative system to more fully exploit the quality of the grapes they grow, she does add, for example, that the co-operative at Ribeauville in Alsace has seen former members return to the organisation.

She uses many examples of high quality co-operatives to illustrate the changing nature of this collective operation, including the Produttori del Barbaresco, the Co-operative Centre Vinicole de la Champagne (owner of the Nicolas Feuillatte brand), and the Sonoma County Vintners Co-operative, which describes itself as the co-op of the new millennium.

Not only are such operations successful, but they also work to preserve the rural economy and increasingly display an ecological responsibility too.

Indeed, they are, Elizabeth adds, an attractive proposition for small producers who do not wish to go down the independent path, particularly because working together can be beneficial in today’s increasingly competitive environment.

Nevertheless, she acknowledges the need for modernisation in many of today’s wine co-operatives.

For a full analysis of the current trends in the co-operative wine movement, see pages 62-65 in the April edition of the drinks business.