Peter Ranscombe travels to Romania to interview Philip Cox, the British entrepreneur who found a niche making wine for his home nation’s supermarket shelves and now owns the Eastern European country’s biggest wine exporter.
Driving up to Cramele Recas outside the city of Timisoara in Eastern Romania, visitors could be forgiven for thinking they’d stumbled across a sleepy rural winery, complete with white-washed walls and terracotta-tiled roofs.
Yet nothing could be further from the truth.
Hidden behind the visitors’ centre and shop sits one of the country’s largest and most modern wineries, which last year produced 20 million bottles, with more than three million of those ending up on supermarket shelves and restaurant lists in the UK.
Output grew by 50% last year to take the group’s revenues up to €42.5m (£37.5m), on top of 45% growth during 2015.
“When I started out, I thought it would just be a boutique winery,” laughs Philip Cox, the entrepreneur at the centre of Cramele Recas’ story.
“I didn’t want to buy all the vineyards that the government wanted to sell to me.”
Now, his company produces the best-selling pinot grigio in the UK – which is sold under a mix of labels – and is expanding its warehouses to cope with stellar growth.
Cox arrived in Romania in 1991 to work for Reh Kendermann, the German company behind the Black Tower label.
Just four years earlier, the country’s revolution had overthrown Communist president Nicolae Ceaușescu and triggered a decade-long programme of restitution, returning land seized by the state to its previous owners or selling it to the private sector.
Cramele Recas was set up by Cox and his Romanian wife, Elvira, along with business partners Ioan Georgiu and Gheorghe Iova, and bought its first vineyards from the government in 1998.
As well as its flagship winery near the town of Recas, the group also owns a chain of 150 franchised-wine shops and 1,175 hectares (2,900 acres) of vineyards, which provide about half of the grapes needed to meet demand, with the remainder being bought from farmers under long-term contracts.
Making quality in quantity
Bristol-born Cox was inspired to enter the industry after travelling to California when he was 17 and meeting winemaker Robert Mondavi, the man credited with putting Napa Valley on the global wine map.
Although also a maker of fine wines, Mondavi’s company grew on the back of producing everyday bottles labelled with the name of their grape varieties.
“It’s harder to make big quantities of decent wine than small quantities of amazing wine,” Cox believes.
“We’re very good at doing big batches of honourable wine.”
Major names from the industry have continued to play a role in Cox’s story; Hartley Smithers – the senior winemaker at Casella, owner of Yellow Tail, one of the world’s biggest wine brands – is one of Cramele Recas’s winemakers, while Diego Tommasi, a member of the eponymous Italian wine dynasty and a lecturer at the University of Padova in Padua, is consulting on how to tend the company’s vineyards.
Last year, exports overtook domestic sales for the first time, notching up 55% of Cramele Recas’s bottled wine sales by volume, with Germany surpassing the UK as the company’s biggest market, followed by the Netherlands, Belgium, Ireland, the Czech Republic and Slovakia.
While Britons have a taste for pinot grigio, it’s sauvignon blanc that’s most popular in Germany and the Netherlands.
“I don’t think it puts people off anymore saying it comes from Romania – people have got over that,” says Cox.
“England is the country that buys the most Romanian wine, so someone is drinking it.
“Twenty-five years ago, people used to laugh at me – now, most British and Irish drinkers are more focused on the variety than where it comes from.”
That focus on varieties instead of locations means many of the firm’s drinks are labelled simply as “Wine of Romania”, allowing it to blend juice from different regions instead of sticking slavishly to a single area.
In the UK, the company lists supermarket chains such as Aldi, Asda, Sainsbury’s and Spar among its customers, alongside upmarket wine merchants like Corney & Barrow and Tanners Wine, and wholesalers including Alliance Wine, Copestick Murray and Inverarity Morton.
Secrets of success
Creating different labels for different customers has been an important part of the company’s expansion – it produces 65 wines, but 247 labels.
Restaurants don’t want to sell wines that diners can buy from supermarkets or bottle shops, while retailers don’t want to stock the same labels as their rivals – so, even though the design on the bottle might be different, the liquid inside is often the same.
“We’re Romania’s biggest wine exporter – we sell more bottles than all the other wineries put together,” adds Cox.
“Germany is a more stable market than the UK – in Germany, buyers will consistently do what they say they will do, whereas UK buyers will change the volume they want to buy or bill you for ‘lost profit’ if they don’t sell as many bottles as they think they were going to.”
While exports may have swelled, the domestic market remains strong – the collapse of one of Romania’s major producers created a gap in the market, which was already expanding at a fast pace as wages rise and wine becomes more popular.
Yet not all wine in Romania is bought in bottles; bag-in-box wines are popular and stores like Cramele Recas’s chain also allow customers to bring along containers that they can then fill from petrol-pump style dispensers.
Bottled wines carry prestige though, with the domestic market accounting for 80% of the firm’s “premium” wine sales by value, where premium wines are those selling with a shelf price of more than €7 in countries with no excise duty – or the equivalent to more than £10 on shelves in the UK.
Eye-watering prices for domestic wines in Bucharest hotels – often more than double the cost of big-name foreign brands – is testament to Romania’s ambitions for its vinous produce.
With Brexit looming, the growth of the domestic market to match the expansion of international sales is well-timed.
When the UK voted to leave the European Union (EU), Cox immediately began expanding in Germany.
While Romania has been part of the EU since 2007, it still uses the leu instead of the euro as its currency; the strength of the euro against the pound has meant the country’s wines have remained competitive in the UK while entry-point rivals from France, Italy and Spain have become more expensive.
“If the UK stays in the customs union then we’ll continue to sell to them,” Cox says. “We’re happy if people buy more Romanian wine at £6 or £7 a bottle.”
But he has a word of warning if the UK doesn’t maintain frictionless access to the single market.
“There was so much paperwork before 2007 to trade with the EU – that’s even when you have skilled people who know how to deal with the documents,” he cautions.
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