The Auswine Forum

Continuing on from an earlier comment I made, why has the ill fated merger produced such spectacularly opposing results for their various labels?

On the one hand you have Penfolds and Wynns at arguably their lowest ebb in my memory and yet the perennial lost sheep Seppelt has gone from strength to strength.

The same board and dreaded accountants run the show so what is critical to the success or demise of these labels?

I'm sure TORB will weigh in with an incisive comment or two.

707 wrote:Continuing on from an earlier comment I made, why has the ill fated merger produced such spectacularly opposing results for their various labels?

On the one hand you have Penfolds and Wynns at arguably their lowest ebb in my memory and yet the perennial lost sheep Seppelt has gone from strength to strength.

The same board and dreaded accountants run the show so what is critical to the success or demise of these labels?

I'm sure TORB will weigh in with an incisive comment or two.

The troubles at Wynns sound like they would have occurred anyway (years of machine harvesting taking their toll in the vineyard). For the rest, I wonder whether a Rosemount board that have spent so long fighting the "opposition" (Penfolds) are the right people to get the best out of that same company.
Perhaps it's easier to take over a failing competitor, because as a competitor, you're better placed to observe (& rectify) the weaknesses?

Ian

On the one hand you have Penfolds and Wynns at arguably their lowest ebb in my memory and yet the perennial lost sheep Seppelt has gone from strength to strength.

The same board and dreaded accountants run the show so what is critical to the success or demise of these labels?

Seppelts rebound hasn't stopped that dreaded board and Accountants from cutting the Dorrien. I asked someone at Penfolds last Friday if the Dorrien fruit was going to end up in the Bin 707 - they didn't know the Dorrien had even been axed!

As to why Penfolds and Wynns (and probably Lindemans too) have bourne the brunt of the ill effects, I guess that's where those Accountants saw there was the most fat to trim to possibly improve the bottom-line the quickest and easiest way, without any idea of the major repercussions that followed.

That's purely my uneducated guess, and you would really need one of those bean counters to explain their actions and what went wrong, and I don't think any would be in any hurry to comment on this forum.

Cheers
Ian

Yep, they all probably read the forums but just sit there thinking about the carnage they've caused to great labelsand bottom lines. BASTARDS!

Ian, beware of accountants!!!

The Australian Financual Review did a major article on this last year (2004) that is, it's probably in the chargeable archive but well worth a read.

It's worth noting that Seppelt is a Boutique brand for Southcorp, in the same league as Colsdtream Hills and Devils Lair. Seppelt is largely not exported whereas Penfolds, Lindemans, Rosemount, and also Wynns, rely a great deal on export, especially to the key US markets for Rosie and Pennies.

The AFR article noted that with the merger the US team/s decided to drop all duplicated distributers in each state and pick one to handle both brands.

All of a sudden you had well-connected distributers looking for a good brand to put all their effort behind. Hello Yellowtail!!!. The article notes that Southcorp are playing catchup to Yellowtail now.

With Seppelts it hasn't all been plain sailing. Seppelt has been repositioned as a purely Victorian brand, which is why Dorrien got the chop. I understand Drumborg was at risk of being dropped as a label, although thankfully the Riesling and Pinot seems to be going on. Whether the Fortifieds, particularly the SA based Para, continue under the Seppelts name is conceivably up for grabs, although the Seppelt heritage in South Australia is strong. Perhaps a Seppeltfields branding may be in the offing?

In terms of quality, being a longtime lover of Seppelt I don't see a marked imporvement in recent times, morover a continuation of an illustrious tradition.

For Wynns I think they've been caught with with a couple of less than great vintages coupled with a foray into the machine-pruned thing which didn't help. The second has been addressed as far as I know and we should see more action there.

Penfolds and Rosemount are a more difficult proposition because of the massive production requirements for the wines. It'll be interesting to see how they go with the well-regarded 2002 vintage to be released this year.

Thanks Murray, a few things there I wasn't aware of.

Wynns will come back, they've recognised their errors and I've seen first hand the massive renovations to their vineyards. I think Peter Douglas left a bigger whole than they realised but I'm sure Sue Hodder has grown into the job admirably and we'll see her true abilities within a few vintages once the viticulture is bedded down.

The 98 Penfolds despite the anticipation and hype were underwhelming for me, I gave them all a run blind at various tastings in their peer class at Blacktongues and nothing stood out. I'll do the same with the 02s to see if a great vintage can lift them from their current low ebb.

The 98 Penfolds despite the anticipation and hype were underwhelming for me, I gave them all a run blind at various tastings in their peer class at Blacktongues and nothing stood out. I'll do the same with the 02s to see if a great vintage can lift them from their current low ebb.

The early releases seem to indicate some signs of improvement, but it could very well end up being a mixed bag.

The 2002 Cellar Door Grenache is absolutely superb, the Bin 138 Old Vine blend is the best since 1998 (although I might add a big step down on that one), and the Koonunga Hill is still the same diluted crap that's been masquerading behind the label since the 1999 vintage (including the straight Shiraz released this year). Don't ask what I think of Thomas Hyland or Rawsons Retreat, regardless of the vintage.

TORB has already remarked the Bin 389 was good enough for gold at the recent national show which is promising, but keep in mind the contreversial 1998 took out gold in Adelaide, a tough stomping ground. According to some insiders the 2002 Bin 707 is supposed to be one of the best they've ever seen, but this could also be just hype.

Look out in a few years for a one-off Cabernet from the 2004 vintage; at this stage it won't be a Block 42 as there's a good chunk of Coonawarra fruit in the wine and it's being matured in French oak, but it could be a similar Special Bin release.

Cheers
Ian

Half the problem with Wynns is that they are owned by Penfolds. If a truely great parcel of Cabernet or Shiraz was made, do you honestly think it would see its way in to the Riddochs and Michaels? I can tell you for a fact, that it goes in to 707 and or a top end Penfolds product.

The same goes with the standard black label Cab and Shiraz. These two products sit a long way down on the Penfolds classification tree, and if the parcels of wine are too good, then they get graded into a more profitable product in a brand such as Penfolds to made wines such as:
707
Bin 389
Bin 128
St Henri
Thomas Highland

The only way Wynns will get back to its glory days, is to be sold out of the Southcorp mess, or have it run as an independant brand. Same goes for all those beautiful Lindemans wines from down that way (Limestone Ridge, St Georges, Pyrus). The fruit for those wines also suffers the same fate at the rest of the wine made at Wynns. Anyone noticed how crap they have become of late? This is due to Southpark only being able to make money out of the Penfolds brand.

Half the problem with Wynns is that they are owned by Penfolds. If a truely great parcel of Cabernet or Shiraz was made, do you honestly think it would see its way in to the Riddochs and Michaels? I can tell you for a fact, that it goes in to 707 and or a top end Penfolds product.

The same goes with the standard black label Cab and Shiraz. These two products sit a long way down on the Penfolds classification tree, and if the parcels of wine are too good, then they get graded into a more profitable product in a brand such as Penfolds to made wines such as:
707
Bin 389
Bin 128
St Henri
Thomas Highland

The only way Wynns will get back to its glory days, is to be sold out of the Southcorp mess, or have it run as an independant brand. Same goes for all those beautiful Lindemans wines from down that way (Limestone Ridge, St Georges, Pyrus). The fruit for those wines also suffers the same fate at the rest of the wine made at Wynns. Anyone noticed how crap they have become of late? This is due to Southpark only being able to make money out of the Penfolds brand

Given that the Wynns John Riddoch and Lindemans St George are matured in 100% French oak, for the fruit to slip it's way into Bin 707 (which is 100% American) a decision would have to be made well before any barrel work. I wouldn't put that thought past the Corporate heads, but it leaves no real margin for error. It would go part of the way to explain this new 2004 French oak/Coonawarra super Cabernet (or component) they're working on, and the cooler climate fruit that's made it's way into Bin 28, Bin 389 and St Henri since 1996.

On the subject of the Lindemans Coonawarra trio, at one stage they seemed to be on uneasy ground with a combination of shaky vintages/bad vineyard management, CD closure/lack of promotion and a price hike that saw them just sit on the shelves. If the Accountants swung the axe in their direction, personally I wouldn't mind if they went into the higher-end Penfolds wines, and occasionally produce a Special-Bin single vineyard label in exceptional vintages (like the Jamiesons Run Alexander's Block for example). This would ensure at least some form of survival, and a decent level of promotion in their state of origin which is sadly lacking.

Cheers
Ian

Thanks for your comments Ian. In relation to when the wines are classified, it happens in about June of the year the wines are made i.e. the wine ins't left at Wynn's to be aged as Sue Hodder and her team see fit, and then classified after a year or so in oak.

I think this just shows how hard it is for a company to take over another brand, and leave that brand with its own style, marketing, direction etc. Southcorp killed a few really great brands such as Leo Buring, Rouge Homme and Tollana, and I suppose it was a credit to how strong the Wynns brand is/was, that it has taken this long for it to decline. Someone earlier commented on how important Peter Douglas was to Wynns, and I completely agreed. He was a single minded person, who wouldn't care who he upset, as long as it was the right thing for Wynns.

I guess now we just have to pray that Majella never gets taken over!!

Can't see the Prof ever getting taken over, whatever would he do for fun?

He certainly couldn't cram any more Asian restaurants into his schedule than he currently does!