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Schaafsma says major Oz distribution deal makes Broadland "relevant" for the future

Published:  11 December, 2017

Broadland Wineries is aiming to become a one-stop shop for antipodean wines thanks to a new major distribution deal which will see them partner with Australia’s biggest bulk wine supplier.

The new deal is with Pinnacle Drinks, the brand supplier to Endeavour Drinks Group - the alcohol division of leading Australia retailer Woolworths Group.

Through Pinnacle, Broadland will be able to distribute the likes of Barossa Valley’s well-known Dorrien Estate, although the biggest coup for Broadland is the potential for expanding its portfolio of Broadland branded, private label and own-label wines.

According to new CEO Paul Schaafsma, the deal means Broadland will be able to “source wine from every region of Australia” in the “right volumes and at the right price”.

Schaafsma took over as CEO in September, bringing across contacts and enthusiasm for Aussie wine from Australian-based wine giant, Accolade Wines.

Today, he expanded on plans laid out in September to mine Broadland’s “significant untapped potential” by becoming more competitive for supermarkets which will increasingly feel the pinch from global shortages and squeezed margins in 2018.

The deal will “capitalise on the fantastic bottling operations and gains in distribution we have already made, but it will also mean we will have the most competitively priced Australian and New Zealand wine in the UK,” he told Harpers.

“Australia is incredibly important in the UK. It has 21% of the wine market. Next year will be a real challenge for supermarkets with exchange rates the way they are and also wine shortages. They will be looking for a supplier which can offer them the volumes they want at the prices they want.”

Woolthworths – which has no relation to the now defunct British store of the same name – is the largest takeaway alcohol retailer in Australia and the country’s biggest bulk wine supplier.

It also owns alcohol supermarket chain Dan Murphy’s and also smaller BWS stores, which altogether make up over 50% of the take-away alcohol market in Australia, worth 7.1 billion AUD in 2016 (Roy Morgan Research).

Schaafsma believes the agreement will increase Broadland’s relevance going into 2018 and beyond, by allowing them to operate more effectively in a climate defined by range consolidation and price competition.

Broadland Wineries currently operates in the UK, North America and Nordic countries as a supplier, producer, and importer serving the on and off-trades, with a portfolio that is skewed towards New World wines for distribution here in the UK.

Schaafsma said: “The business currently has £60 million in turnover which includes British and Australian-made wines and also fusion drinks. We also represent Old World wines, but in terms of what we can do well, it's New World wines because they predominantly need to bottled here to make them economically viable.”

Following on from the deal, which Lloyd Stephens, general manager international markets at Pinnacle Drinks said was based on the UK’s status as a country where “strong Australian and New Zealand brands can be built”, Broadland is now planning continue the expansion of its New World contracts with further partnerships set to be announced in the new year.