Isn’t it strange how vividly we can recall some of our childhood memories, sometimes many years later? One memory I recall was an action film I watched (my exact age remains hazy) ending with a heavily wounded villain in the closing scene. As the authorities dragged the villain away to a life behind bars, he hurled the following words to the hero of the film through clenched teeth: “A mountain never meets a mountain, but a man meets a man”.

Another miracle was that I remembered the man’s accent revealed that he hailed from a Middle Eastern country. How does one manage to make such mental connections as a child? A quick Google search on Middle Eastern proverbs confirmed my suspicions. This is in fact an Afghan proverb and it means that some things in life are impossible such as an encounter between mountains, but there is always a chance for people to meet. The proverb illustrates how natural it is for people to come together and socialise. Admittedly, being a typical young boy at the time, I imagined the saying was more like a verbal guarantee for revenge!

Besides the practical interpretations of the proverb, I believe that below the physical layers of meaning, it also touches on something more mysterious, namely the principle of synchronicity – the occurrence of meaningful coincidences that seem to have no cause.

One example of a meaningful coincidence is the ability of entrepreneurs to see opportunities where others don’t. In essence, both the stories of 1^st Principles Distilleries and Stellar Organics are examples of how their founders connected ideas to opportunities in the market and, in the process, created amazing brands. By being pioneers in their respective fields, they developed products that addressed market opportunities.

Join me on this exciting journey as we explore the power of innovation.

INNOVATION AS A CATALYST FOR CHANGE AND GROWTH

Innovation was not always what we understand it to be today. The word dates as far back as Greek and Roman periods but wasn’t kindly looked upon by the likes of Plato and Aristotle. Innovation in earlier times was viewed as a negative term and had connotations with political disruption, rebellion and unrest.

In Machiavelli’s famous book, The Prince, published in the 1500s, innovation was portrayed as a strategy to employ to cope with a constantly changing world and to combat the corruption contained within it. In this sense, innovation was defined as introducing changes in government or the political order of the day. After the Second World War, the concept of innovation became popular in a time when people started to talk about the technological innovation of products and connected it to form part of the concept of economic growth and developing a competitive advantage. In early 2000, as a more recent example, we saw the tech start-up frenzy, later to be known as the Silicon Valley boom.

To conclude, Peter Drucker’s definition of innovation, in my opinion, is closest to our understanding of the concept today:

Innovation is the specific function of entrepreneurship, whether in an existing business, a public service institution, or a new venture started by a lone individual in the family kitchen. It is the means by which the entrepreneur either creates new wealth-producing resources or endows existing resources with enhanced potential for creating wealth.

According to Henderson and Clark, innovation can be divided into four different variations, namely:

Radical

Innovation that leads to an entirely new dominant design and, hence, a new set of core design concepts embodied in components that are linked together in a new architecture.

Incremental

Innovation that refines and extends an established design and where improvement occurs in individual components. The underlying core design concepts and the links between them remain unchanged.

Architectural

Innovation that leads to a change in the relationships between core design concepts.

Modular

Innovation that changes only the core design concepts of a technology.

Innovation clearly brings together opportunities, resources and talent in ways that visibly affects change and brings forth exponential growth.

1ST PRINCIPLES DISTILLERIES AND THE QUEST FOR INNOVATION

Back in the day, it was close to impossible to obtain a small-scale production licence. With continuous pressure from some pioneers such as the legendary Sidney Back (who wanted to produce his own Estate Brandy and later became the now-famous Backsberg range of wines and brandies), applications from smaller distilleries were taken more seriously. To be awarded a craft spirit production license is no easy feat, one for which every successful applicant needs to be awarded an honorary medal in impudence, to say the least!

In 2018, despite the licensing challenges, 1st Principles was awarded its production license. From the humble beginnings of producing local cultivars and involving themselves at all levels of the industry, to eventually creating their own brand of craft spirits, 1st Principles have explored several avenues to get to where they are today. Their innovation and creative exploration with exotic tastes, creative flavours, and the use of a wide range of natural products, of which the majority farmed and produced in the Olifants River Valley, and the use of organic and fresh botanicals is what led them down a continuous path of exploration and discovery, living up to their own belief in first principles.

After being actively involved in the production of Rooibos and Honeybush tea for many years, 1st Principles Distilleries continues to experiment with fynbos as an important base ingredient. They have created a unique range of craft spirits, such as Gin, Vodka and Brandy, effectively exposing these fringe industries to new product development, while simultaneously exploring new applications, aromas, flavours and tastes to be enjoyed by craft spirit connoisseurs all over the world.

The type of copper still used at 1st Principles dates back to a time when, more or less, every farm had one. It’s not exactly known when the copper stills started disappearing, but historians date it to being around the 1920s. Since its decommissioning, many years ago, it served as a planter for Joubert’s mother’s Daisies, but it piqued his interest, and he was determined to figure out how it all worked. It was masterfully restored by coppersmith Errol Jafta, one of only a handful of active coppersmiths remaining. Jafta added a vapour infuser, which, besides being beautifully restored, also makes it unique and one of a kind.

1^st Principles Distilleries has continued to expand their operations and stands out as a great example of innovation in the region and have expanded its operations by investing in recycled products and by supporting local industry and service providers of the greater Vredendal wine region. Cement is ordered from Piketberg, bricks come from Klawer, white aggregate from Cape Lime, produce from Stellar Organics and botanicals from local farms. What makes their production process unique is their pursuit to minimise their carbon footprint and a special emphasis is placed on green technologies such as the use of a detailed greywater system, natural heat and the use of solar panels, to drive the distillation processes. While not yet a complete operation, things are certainly getting there, and improvements are continuously being investigated and implemented.

1st Principles also boasts that the only water leaving their premises is what is bottled within their products while running their entire operation on a greywater system. Cooling is done with irrigation water, toilets are flushed with brown water and black water is used to irrigate bamboo, ensuring that the entire operation’s carbon footprint is kept to a minimum. All their products are packaged and bottled plastic-free and shipped in virgin wood wool which can be used for several other natural processes such as keeping fruit fresh or as mulch in pot plants and potting soil.

The 1st Principles Distilleries’ range of craft spirits such as Gin, Vodka and Brandy to name a few, offers on-site visitors and online customers a unique tasting experience and an opportunity to purchase their products online. The craft spirits are bottled in a selection of differently sized bottles. They are some of the unique craft cocktail products offered along the Vredendal wine route, which is a special part of the greater Olifants River Valley and the ever-popular Vredendal wine region. While paging through the gallery of images and listening to Roux’s contagious enthusiasm, one can’t help but get a sense that 1st Principles is a special place that offers visitors an experience like none other and inside each bottle seems to be another story brewing…

But great entrepreneurs and brands tend to find other like-minded individuals, brands and enterprises, and in many cases, they create even greater synergies.

STELLAR ORGANICS – A CASE OF EXQUISITE TIMING

One such like-minded individual is Willem Rossouw, founder and Managing Director of Stellar Organics and Winery, a well-known and much-loved producer of organic wines and locally grown produce in the Vredendal wine region. This successful enterprise not only boasts a world-class range of red and white wines and other locally produced organic products but is also internationally certified to produce according to highly regulated and stringent quality standards and practices.

The Stellar Organics story began in 2001 when founder Willem Rossouw convinced his brothers (all capable fruit and vegetable farmers in their own right at the time) to join forces with him and to cultivate grapes. Equipped with an A-type personality and entrepreneurial flair, Willem saw an opportunity in the market to produce organic wine. The cool coastal winds blowing in from the Atlantic Ocean into the Olifants River Valley’s rich and fertile soil together with an abundance of naturally occurring limestone fault lines created ideal conditions to grow quality grapes for producing wines with unique character.

In the preceding years, from approximately 1994 onwards, the South African wine industry found itself in the fortunate position of having been re-admitted to the global economy. Local wine farmers, eager to cash in on higher sales volumes anticipated from wine exports, soon found themselves offering excellent quality wines but at lower than market prices. The international community, as many winemakers and producers quickly learnt, was in search of the best quality but at the lowest prices.

Many of the well-established wine brands agree that the South African wines have, for many continuous years, battled to establish South Africa as a reputable wine country and the ever-present reality of dwindling wine prices seems to be a constant threat to exports. Despite this somewhat volatile reality, Wines of South Africa (WOSA) have played their part in promoting local wines and brands to the international community, a feat that often goes unnoticed. Brand South Africa had yet to carve out their niche in the marketplace.

ORGANIC WINE – A MATTER OF PRINCIPLE OR AN EXPRESSION OF ART?

In his latest book, Numbers Don’t Lie: 71 Stories to Help us Understand the World, Vaclav Smil writes about how the French are drinking a lot less wine than they used to. “Viticulture, wine-drinking, and wine exports have been long established as one of the key signifiers of national identity” in France, writes Vaclav. In 1926, the average French person drank an impressive 136 litres of wine (or more than 35 gallons) a year. But by 2020, that figure had shrunk to just 40 litres.

The fact that French wine consumption is now only a third of what it was a century ago, confirms how global societies are changing. While young French people are drinking less alcohol overall, the consumption of mineral and spring water has more than doubled since 1990. This would suggest that consumers are all indeed becoming more aware of what they eat and drink. This is one of the main reasons why we see an increase in demands for organically produced wines and other produce.

But what exactly is organic wine and how does it differ from traditional wine production and traditional wine-making practices?

Organic wine is made from grapes grown in accordance with principles of organic farming, which typically excludes the use of artificial and chemical fertilizers, pesticides, fungicides and herbicides. To have organically grown grapes, a vineyard manager must implement an entirely different set of practices to maintain their vines, for example using runner ducks to rid vines of insects.

Organic wines differ from their traditional counterparts specifically in terms of the importance of the sulphur-dioxide during the process of winemaking. There is quite a difference, for example, between what is considered organic in the US versus in Europe. Organic wines from the US are made from grapes without added sulphites, whereas in Europe and Canada organic wine is made from grapes that may contain added sulphites.

Stellar Organics exports a range of No Sulphur Added wines to the US where a maximum of 10 parts / 1 000 000 free and total Sulphur is permitted. On average Steller’s wines fall between 6 to 8 parts / 1 000 000 which is well within the set parameters. This is a critical requirement to be certified as an organic exporter to the US markets. The wines offered in the Stellar stable are certified organic, vegan and fair-trade wines. Many consumers are not aware that, in general terms, organic does not necessarily imply that the wine is free of all additives, in fact, there is a list of additives that are permitted in organic wine. Thus, interestingly, organic wine is not automatically classified as a vegan-friendly wine.

Many organic wine producers often start as traditional winemakers and then gradually make the transition to producing organic wine. The decision to make the change is a decision made out of principle rather than for profit or turnover, as it remains a challenging and costly endeavour. Organic wine producers need to follow specific practices during the cultivation of the grapes, and it all starts in the vines is a well-known saying in the industry. These regulations also include activities and processes in the cellar where certain prescribed practices must be followed and other specific prohibitions exist.

Organic wine production is a highly regulated matter and farmers are subjected to stringent certification audits which evaluate and regulate production methods, general practices and the adherence to international laws and regulations on an annual basis. Certifications and audits are performed by Ecocert, an internationally recognised body with their Head Office in France. Ecocert is responsible for awarding certifications, issuing new regulations, setting service standards and for listing accreditation criteria for the European Union agricultural sector and other wine-producing regions.

It was always Stellar’s goal to become a certified organic wine producer and to create quality wines and other organic produce. But what exactly are the benefits of being an organic wine producer and more importantly what are the benefits to the consumer?

• Certified organic wine assures consumers that the end product has been created according to the prescribed and approved methods, principles of sustainability, and organic farming practices.
• A certified producer has to meet a stringent set of requirements. In combination with the annual quality audits, a producer commits to maintaining the quality of the wine and continues to implement the approved farming practices in all aspects of the production cycle.
• Ecological practices are maintained to ensure sustainable operations, starting from the growing of the vines through to the delivery of the final product on the shelf. Every element of the production process is evaluated.
• The entire goal of organic farming is to stay as close to nature as possible and to create sustainable produce, healthy farming practices, carbon-free production cycles and to take care of the soil, fauna and flora.
• Organic farming practices also propose and evaluate practices that best remove impurities and other unwanted chemical trails from nature by making use of natural processes.
• Organic farming is a decision made, first and foremost, on principle and no producer decides to produce organic wines lightly. It comes with serious cost implications in terms of financial, operational, agricultural and human resources.

Organic wines, in exchange for the exhaustive list of prescribed farming practices and requirements, has given farmers and producers a considerable market share advantage. Organic wines come at a higher premium for consumers but reward the consumer’s commitment with peace of mind. In the early days of organic winemaking, winemakers struggled to meet the superior quality associated with traditional methods, but fortunately this has changed. Farming practices combined with technological advancements mean that organic winemakers can now compete at both price and quality levels with traditional winemakers.

Suppose a wine producer manages to correctly do all of the above while combining it with long-term goals – where can such a road potentially lead a brand?

STRATEGIC PARTNERSHIPS AND THE IMPORTANCE OF NEW PRODUCTS

In the early days of its creation, Stellar operated from their main farm located in Trawal. It soon became apparent that the farm was too small to accommodate Stellar’s future growth plans. In 2010, Willem Rossouw bought the abandoned KWV Distillery and moved Stellar Organics’ entire agricultural operation to its current location in Kys Halte in the Vredendal wine region of the Western Cape. In 2012 the Head Office and Administration departments joined the Agricultural teams at their new location.

The operational requirements at Stellar Organics are continuous and call for a range of specialised skills. To ensure that all elements of the agricultural and production teams run at optimal levels, Stellar has full-time engineering, maintenance and mechanical teams who are responsible for the different functions every day. One of the key management approaches is to be able to function independently and therefore the majority of support services are provided in-house. By following this approach, Stellar has managed to create better agricultural yields but at lower costs.

This is but one example of how Stellar Organics has grown into a network of employees, shareholders, partners, stakeholders and other interest groups over the past two decades leading to the success of the business. One such special partnership, which continues to develop and expand into other areas and products, is with upmarket retail partner Woolworths Foods.

Considering the rise of a new generation of health-conscious consumers coupled with demands of sustainability and the health benefits of organic wines and products, it hardly comes as a surprise that Stellar Organics initially started with two product lines and quickly expanded that number closer to 20. The products include a variety of unique juice blends, B-I-B (Bag in the Box) wines, Sparkling wines and Coolers with a new range of agricultural products planned.

One key lesson learnt from the ongoing relationship with Woolworths Foods, as explained by Export and Sales Manager, Jacques Skinner, is the value of new product development and the power of diversification. In a tough economic climate, especially with many Covid restrictions still in place and the impact this has made on emerging markets, it is of critical importance not to be dependent on wine production only, but to also have a diverse range of new products in other sectors. Diversification and new product development lead to continuous and future growth. In keeping with this understanding, Stellar Agri is currently creating a new range of organically produced vegetables including sweet potatoes, pumpkin, watermelon and potatoes, soon to be available to consumers in-store.

1st Principles Distilleries, a client of Stellar Organics, was one of the first brands to notice that there existed a clear brand alignment in terms of making use of organic produce to create their unique range of craft spirits. Founder, Joubert Roux also supports the notion of sustainable farming practices and keeping a watchful eye on new practices to help reduce their carbon footprint. Investing in the community and supporting local suppliers of goods and services was just another coincidental common value shared between the two businesses and stands out as yet another example of what can happen when cross-sector alignment is done right.

What other attributes play a role in creating an innovative business?

EMPLOYEE CENTRED WELLBEING – THE IMPORTANCE OF VALUES, ETHICS AND A SPECIAL FOCUS ON SOCIAL DEVELOPMENT

Managing Director and Founder of Stellar, Willem Rossouw, agrees that the business could never be what it is had it not been for the compounding effect of all the employees, teams and partners throughout the years. With important brand values such as integrity, passion, diligence and compassion, one cannot help but get the sense that the business doesn’t simply speak about values, but that it’s a lived experience radiating through all departments and their people.

Employees attest that to make it as a Stellar employee and to be considered a valuable team player, requires one to possess and display tenacity, flexibility and perseverance; a clear indication that nothing in life comes easy and that it takes character and a willingness to work hard – every single day of the week.

Willem Rossouw describes this symbiotic relationship best in his own words:

“Stellar has built a reputation for doing business with integrity, of finding new ways to work and live together, and of building something bigger than all of us. This remains our philosophy.”

True to his own belief and that of Stellar, the brand is an active and accredited member of Fair for Life located in Zurich and taken over in 2014 by the Ecocert Group in France. One of the key objectives of these formal bodies and the accreditation programmes is to see the upliftment of poor communities out of institutionalised poverty by involving them in community projects and profit share schemes to improve their living conditions and socio-economic circumstances.

In support, and true to the Stellar principles of integrity, Rossouw created the Stellar Empowerment Trust, a Level 1 Broad-Based Black Economic Empowerment (B-BBEE) group, comprising farmworkers and employees. The Empowerment Trust is also a shareholder in Stellar Winery (Pty) Ltd and a majority shareholder in Stellar Agri (Pty) Ltd. A percentage of each bottle of wine sold goes to the Stellar Empowerment Trust and the Stellar Foundation (NPC / PBO). Out of the proceeds created from wine sales, new community and socio-economic projects and programs are identified and funded.

This entire community, in conjunction with Stellar’s management team and the different subsidiaries, is a great example of what is possible when different groups of people put their minds and efforts together and get to work in their communities.

One gets an honest sense of pride and ownership emanating from the community, a reciprocal acknowledgement of people’s humanity and dignity and that this is not simply another long list of charity projects based on lip service, but a deeper commitment to develop people and to become part of the socio-economic tapestry.

CLOSING COMMENTS

In developing countries, but also in many advanced economies, innovation helps to create new products and new methods of manufacturing. New products not only revitalise existing industries but help create entirely new ones. Innovation, by its very nature, creates the fertile soil needed for economic growth. This growth is a vital element in any developing economy.

Upon questioning 1st Principles Distilleries founder, Joubert Roux about the disappearance of the classic stills from local farms )where there once was no shortage of these marvellous engineering feats) his answer again illustrates the prominence of innovative thinking:

“Their disappearance was due to the stringent excise duties and tax collections on spirits. Not only did it cause the disappearance, it also caused the overall decay of the industry. Had this not happened we would possess a vibrant and diverse craft spirit industry in South Africa today. I believe the latest boom in craft spirits and cocktails is a perfect example of just how necessary innovation and creativity of the small-scale distilleries are to keep the industry in constant development”.

But innovation in a modern sense is so much more than purely creating new products and new sources of revenue. It is also about integrating new best practices and actively caring for the environment by creating sustainable business models where employees, shareholders, community members and nature share equally in the spoils. Developing sustainable distilleries and organic wineries is not optional anymore. It has become the new norm in creating world-class wines and crafts spirits while also looking after all the stakeholders in the entire process, especially where consumers are taking a stand to combat global warming practices and are much more aware of what they put in their bodies and how it was produced.

For the past twenty years, through careful planning and with a strategic focus, Stellar Organics and 1st Principles Distilleries have become some of the best examples of sustainable organic wineries and craft distilleries, respectively, in South Africa, and their continued focus on innovation and new product development will pave the way to new and exciting industries and ideas in years to come.

There can be little doubt that innovators and creative entrepreneurs are the new captains of industry and the catalysts for necessary growth across all economies.

I would speculate that, in the case of 1st Principles Distilleries and Stellar Organics, mountains do meet after all.