Thu, 25 Feb 2021

Liquor bans set the industry back years

News24
23 Feb 2021, 04:10 GMT+10

Thokozani means celebration. But the stakeholders of Thokozani Wines don't have much to celebrate. Instead, they will be facing dire consequences if the partial ban on local liquor sales in South Africa continues or if a full ban is reinstated again, writes Denise Stubbs, CEO of Thokozani Wines and Hospitality.

When Thokozani, a black-owned wine company, started out 20 years ago, it was not about government's need for a more transformed wine industry. It was born from a real desire by David and Sue Sonnenberg, owners of Diemersfontein Wine and Country Estate, to make a difference in the lives of those working in the wine industry. So we established a business in which farm workers could be individual shareholders and owners; one in which everyone would be transformed from those working in the vineyard up to management level. And we managed to do just that.

Over the years we have received support from government on certain projects, and can say that the Western Cape government has really taken our hand, providing much-needed guidance. As in any business, we've had our challenges, but we would never have guessed that we would have to face a challenge as big as Covid-19.

Today I don't blame Covid-19 for the state our business is in; I blame the poor decisions by our government.

Throughout the years we've expanded our business to include tourism. Currently we have 16 rooms that are empty. We have 75 shareholders, ranging from vineyard workers to management, who couldn't receive dividends on their shares during this time. And we have had to endure a third partial liquor ban.

The first lockdown and liquor ban was understandable, as the epidemic was suddenly upon us, and the president had to act swiftly to curb the spread. But the second and third bans on local liquor sales were totally nonsensical. You can't switch an industry on and off like a light - even more so in agriculture. We work in seasonal cycles, and processes need to continue. We still need to cultivate grapes, harvest them, ensure that the wines are made and bottles are filled, and get the quality and quantity right to supply to our markets.

Three-year setback

The liquor bans have set us back by three years. We have an oversupply of wine in our tanks that we will probably have to sell at ridiculously low prices. We've put so much hard work into building our reputation as a producer of high-quality wines, but now we will have to sell our wines at discounts of between 25% and 50%.

Thokozani was also the first transformation brand that was successful in securing an exclusive listing at Woolworths - something that took us five years to achieve, and was key in tripling our turnover.

We now fear we would have to discount our wines in this channel to the long-term detriment of our brand's image and bottom line. This extends to other wineries and our industry as a whole in the local and international market.

While we are grateful that exports may continue, as well as for the support from consumers across the globe through the #SaveSAwine campaign, in reality new export markets don't open up overnight. It takes years of hard work to get a foothold in markets abroad.

The president cut off our last lifeline when he announced the third blanket liquor ban on 29 December 2020. We don't know whether we will be able to pay our employees their full salaries. Banks won't grant us an overdraft and we aren't able to gain access to any further government assistance at this stage.

My heart breaks for each and every person working in our industry and the communities we support. Every person who works in our wine industry supports on average around six dependents. The next big epidemic that we will be facing is unemployment. I foresee that people will not only die from Covid-19, but also from hunger and other ills related to poverty and malnutrition.

Wine is not 'booze'

Many media refer to "booze" when talking about the liquor ban. The images and language used depict cheap liquor that is consumed - or rather abused, not the wine industry I and others have poured heart and soul into. Wine is a quality agricultural product that is crafted by dedicated women and men who work hard in the vineyard and cellar throughout the year. Please, show our industry for what it really is.

Under the "dop system", farm workers were paid in poor quality wine concoctions - a terrible ill the industry worked hard to eradicate.

Through the prohibition of legal liquor sales, however, government has managed to fuel illicit trade, a fresh danger. People are paying a lot of money to buy concoctions made from poor quality wine, which has led to hospitalisations and even deaths.

Government should not be closing legal, regulated channels.

Keep politics out of it

We at Thokozani respect the fact that many have died due to the pandemic - many of us have had to say farewell to family members and have experienced the severity of the virus first hand. But we fail to understand how government can blame the liquor industry.

The president says that he spoke to the industry. If he had really engaged with us, tried to fully understand that the wine industry is not a booze industry but one of quality and craft, and taken heed of the effect of the prohibition on the livelihoods of the people and communities who are dependent on this industry, he and the National Coronavirus Command Council would not have made these - for lack of a better word - unrealistic decisions.

It seems that politics was prioritised above the lives and livelihoods of South African citizens.

Source: News24

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