Halewood Romania sheds low profitability products

Bogdan Garofeanu, marketing manager of the most important wine exporter on the domestic market, Halewood Romania, believes premium brands ensure competitiveness on foreign markets.

“We”ve decided to renounce very low profitability products and this is why we haven”t bolstered our sales volume on foreign markets. It is hard to be competitive with such products in the battle with Argentinean or Chilean producers,” says Garofeanu.

Halewood group is the biggest Romanian exporter of bottled wine, with a 20% market share. Halewood annually sells 4 million bottles of wine in more than 40 countries. The destinations of export are the UK, Estonia, Denmark, Russia and the Czech Republic. The best selling export brand is Prahova Valley.

This year, in the wake of an assessment of strategically relevant markets for the brands included in Halewood portfolio, the company decided to direct its exports toward the United States.

The US market ranks fourth in the list of Romanian wine exports, with a value close to 2 million dollars. According to the National Vine and Wine Association, which quotes research by the I.W.S.R (International Wines and Spirits Record), by 2008, the United States are due to become the most important wine consuming market worldwide, in terms of physical volume. Wine sales are projected to increase from 16.7 billion dollars in 2003, to 24.2 billion dollars in 2008 and thus traditional countries such as Italy, France and Germany will lag behind the American market.

“We are in the phase where we are seeking distributors for our products to the United States, a phase to be followed by an intensive promotion campaign,” says Garofeanu.

Halewood”s policy for both the foreign and domestic markets targets higher sales of top brands, such as Byzantium, Prahova Valley Special Reserve and Cherry Tree Hill

To sustain this growth, the company has decided to launch a sparkling wine brand on the premium market. “We will launch the Rhein Extra sparkling wine in mid April, to be sold only on the hotel-restaurant-catering segment and in specialised stores, which sell to an exclusive group of consumers,” says Garofeanu.

He specified that the Halewood group was also the owner of the Rhein brand, largely known in the interwar period, and had a winery, which had this name. “It would have been a pity not to use this image as an advantage, even more so as Rhein is still enjoying awareness especially with older consumers,” adds Bogdan Garofeanu.

The Halewood portfolio also includes another sparkling wine known as Prahova Valley.

“We preferred to launch a new brand that has a history behind it, rather than re-launch Prahova Valley. With this move, we are trying to add products for all types of consumers on the market,” Garofeanu adds.

Halewood Romania last year posted turnover worth 11 million euros, up 18% from 2004.

Halewood Romania

* Most important exporter of Romanian bottled wine

* Accounts for 20% of the market of exported bottled wine

* Annually sells 4 million bottles of wine in over 40 countries

* Plans to boost sales of top brands to be competitive on foreign markets

* Reported turnover worth 11m euros last year, 18% higher than in 2004

* Projects 25% higher sales and turnover topping 14m euros for this year