South African Wine Company Goes Global with U.S. Help
Globalization of wine business is linked to land reform

by Phillip Kurata, Staff Writer, America.Gov

Cape Town, South Africa — Loukie Vlok, the winemaker of South Africa’s Koopmanskloof Vineyards, points to six bottles on a table — three reds, two whites, and one rosé. “These wines are going to be known around the world and make us rich,” he says.

By “us,” Vlok means primarily the 86 black farmworkers who collectively own one of the six Koopmanskloof farms and 26 percent of Koopmanskloof Vineyards, the winemaking and retailing firm.  He also refers to the mostly black businessmen who have a controlling interest in the vineyards and to Steve Smit, the aging owner of the five other Koopmanskloof farms.

The Koopmanskloof lands and winery, located in the lush Stellenbosch region north of Cape Town, have produced wines for more than 100 years, but the people who used to drink them knew them by other names. The wine was sold in bulk; buyers bottled it and put their own labels on the bottles.

“Mr. Smit was not interested in marketing.  He was only interested in the quality of the production.  I told Mr. Smit that other people put their names on our wines and make extra money from that.  I told him that we could do that too,” Vlok said.

The launch of Koopmanskloof wines under its own labels came in 2005.  That event was the outcome of a convergence of factors, the prime one being the South African government’s drive to place 30 percent of the country’s farms under black ownership by 2014.  The government is steering clear of the forceful land-seizure policy taken by Zimbabwe, a policy blamed for devastating agriculture and causing famine in Zimbabwe.

Taking a different approach, the South African government is trying to build partnerships with South Africa’s white farmers, paying them for their lands and putting ownership in the hands of the farmworkers.  In return, the government is asking the former owners to continue managing the farms while they train the new worker-owners.  This is part of a broader policy, called Black Economic Empowerment, which is intended to bring once disenfranchised blacks into the mainstream of all sectors of the economy.

The U.S. government supports this policy with its South African International Business Linkages (SAIBL) program, which is administered by the U.S. Agency for International Development. The agency reports that since 1998, SAIBL has helped more than 10,000 black, historically disadvantaged businesses, helping them to create more than 17,000 jobs and generate sales exceeding $1.4 billion.

For Koopmanskloof, SAIBL experts carried out a thorough diagnosis of its business.  Out of this has sprung the decision to market under Koopmanskloof labels. The SAIBL examination also coached managers in how to sell wine in international markets, train personnel, draft business plans and acquire the international fair trade accreditation.

Speaking to America.gov from the Cape Town airport September 30 as he was about to board a flight to China on a marketing trip, the chief executive of Koopmanskloof, Rydal Jepfta, expressed gratitude for the U.S. support.

“SAIBL has helped us meet major challenges,” Jepfta said.  Before joining Koopmanskloof in 2007, Jepfta was the general manager of Thandi Wines, another South African brand that is run by black executives and winemakers and that was the subject of a 2007 BBC documentary.  While at Thandi, Jepfta developed a reputation as an imaginative and energetic business leader.

His plans for Koopmanskloof do not end with putting bottles of fair trade wine on the shelves of shops in the United States, Europe and Asia.  There are artificial ponds on the farm, constructed for water management.  He intends to turn them into fish farms.  “Africans need more protein in their diet, and fish is a good source,” he said.

The Koopmanskloof farms have a low mountain that allows a person standing on the summit to see the Atlantic and Indian oceans, Table Mountain, and lush valleys.  Smit had built a cabin on the summit where he hosted private celebrations.  Jepfta talked of plans to turn the cabin into a restaurant and lodge for tourists and of building hiking trails on the hills where the guests could sharpen their appetites.

A portion of the Koopmanskloof profits will flow into a trust for the worker-owners, which they can use to improve their homes and send their children to high schools and universities.  Loukie Vlok is sending his black apprentices to school so they can understand the reason behind the grape cultivation practices he has taught them for decades.

“They carry out my instructions very well.  Now, they will learn the reasons for my instructions.  In the future, they will be master winemakers,” he said.