The ginestet case study. Internationalisation as a way to



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THE GINESTET CASE STUDY.

INTERNATIONALISATION AS A WAY TO

RENEW BORDEAUX WINE ECONOMY’S

ENTREPRISE SPIRIT

(1978-2000)

Christian Delpeuch,

chief executive officer of Ginestet, Bordeaux,

& Hubert Bonin,

professor in contemporary economic history at Bordeaux

Political Sciences Institute

The Bordeaux wine economy endured a grave crisis

at the beginning of the last quarter of the 20th century: most of its familial trade houses were submerged

by losses and failed down. The renewal of bordeaux wine economy was due to new forms

of capitalistic and commercial strategies. Large French financial groups (Suez, Paribas) linked to

investment banks, or foreign French and alcohol and spirits groups (Bols, Seagram, Pernod-Ricard,

Rémy-Cointreau) or wholesale traders (John Holt) took hold of Bordeaux wine houses. But this

trend was brought to a halt at the very end of the century: specialists in wines and alcohols more

and more prevailed. Multiregional wine sellers constituted groups which developed all over France

dynamic policies to rebuild commercial networks. Whereas their strategy turned towards the internal

mass market doesn’t matter here, their involvement in the reshaping of an international network

and trademark will be the core of that case study. Whilst waiting for a large synthesis about Bordeaux

trade at the end of the century1, we’ll concentrate our attention on a middle-size company, Ginestet,

as a testimony about the requirements of internationalisation but too about its very usefulness for

the renewal of business.

1. Ginestet from a halted strategy to renewal

Since its foundation in 1897 by Fernand Ginestet2, the wine trade house Ginestet had been a wellknown

brand-name and merchant house for a long time in Bordeaux, about one of the fifteen more

important there, with 70 % of its turnover (34 millions francs in 1975) through exports. The

Ginestet family had reached some high level within Bordeaux society; it played a key part in several

professional institutions, and it had constituted too a solid patrimony through the purchase of

several renowned vineyards: Cos d’Estournel in 1917 and Château Margaux (in several steps

between 1934 and 1947)3. But, after the so long guidance of the patriarch Fernand Ginestet in

1953, under the second and third generations’ management, the company failed to match the

rebuilding of selling forces all over France and Europe in the 1960s-1970s: it lacked contacts with

the new forms of ‘modern retailing’, that is self-service markets (hyper- and super-markets chains

79

and their centralised purchasing entities), whilst losing efficiency on traditional outlets, wholesale



wine and alcohols traders abroad. Like many bordeaux wine trade houses thus, it lost ground in

front of competition.

Moreover a speculation crisis that burst out in Bordeaux in 1973-1974 shook several companies

which were financially burnt out by wine overstockpiling and discrepancies between high tariffs at

buying and the fall down of trading prices… After a deficit of 20 millions francs in 1973-1975, its

total debt rose to 67 millions francs4 in 1976; a terrible crisis shook Ginestet in 1976-1977. As

bankers showed hard pressures, the Ginestets had to sell Château Margaux, a most famous vineyard

and grand cru (for 72 millions francs!) which it had bought in 1920. The second (Pierre Ginestet,

born in 1900 – whilst Jean-François, Pierre’s elder, died in 1974) and the third (Bernard Ginestet,

born in 1936) generations of the Ginestet family were thus deprived of the company.

Ginestet itself had to find a new way of capitalistic life in order to resume its resiliency. After

several events, it was therefore aggregated in 1978 to a large wine group, “Groupe Bernard Taillan”.

That one, under the guidance of Jacques Merlaut and Antoine Merlaut, manages wine affairs not

only in Gironde, but too in the Rhône Valley and Languedoc (La Compagnie rhodanienne) and the

Loire Valley (Joseph Verdier). Its international scope is proven through some aspects: Joseph Verdier

finds 29 % of its turnover through exports, La Compagnie rhodanienne 17 %. The objective is of

course, like in any other wine and alcohol group, to provide the commercial network with a broader

range of wines, either coming from France or gathered on foreign areas. Subsidiaries and commercial

entities have been set up in Japan, in China, in SouthEast Asia and in North America, and assume

a group function of promoting the group’s whole range of wines.

2. The successful reshaping of a wine trade house

Within that strategy, the Ginestet company itself has been submitted to a whole rebuilding – and

its headquarters themselves left Bordeaux to the outskirts, at Carignan-de-Bordeaux. Its commercial

force has been shaped up in order to enlarge outlets: networks have been warmed up through an

active commercial policy; the range of products and brands has been considerably propped up – and

these efforts were intensified especially under the management of a new chief executive officer since

1990, Christian Delpeuch.

First the main trademark itself, “Ginestet”, has been revitalised, through a reshaping of the aspect

of the bottle stickers, and moreover through the enlargement of the range of “generic wines”, that

is wines gathered from various bordeaux vineyards and mixed altogether with subtetly (“assemblage

or wine vintages blending). In fact bordeaux wines have been traditionally sold under the brands of

the producers themselves (for grands crus or middle range wines) or along brand names belonging

to wholesale trade houses, like Ginestet, Dourthe or Calvet. The renewal and enlargement of

Ginestet generic wines has been the key target in the 1990s (Marquis de Chasse, Grand Marquis,



Bordeaux de Ginestet, Ginestet, G of Ginestet, Collection d’Autrefois, La Taste, Anthologie, etc.). A mix

of commercial creativity, of wine quality and of an imaginative marketing allowed these generic

wines to conquer their market shares either within France or abroad – and they supplied one third

of Ginestet’s turnover in 1999.

Particularly since 1992, the quest for quality has been posed as a priority all over the bordeaux

wine community in order to resist Californian, Spanish, Italian, South American and Australian

growing competition since one or two decades for middle-range wines, bought and drunk for common

events – whilst grands crus are more and more dedicated to exceptional events or high class consumers.

Ginestet participated therefore to that common struggle to promote higher quality among

middle-range wines and all the more a more stable high quality as a lot of wines of that type had been






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