Analysis of success

In this modern age of venture capitalists and support for innovative tech startups, the notion of one person driving from wine farm to wine farm in a VW Caddy, pitching up unannounced and without an appointment, personally asking strangers to pledge R10 000 to start her business seems somewhat far-fetched and homespun if not impudent.

But it’s what Hanneli Smit did to get VinLab off the ground in 2001. VinLab is a fully accredited – independent – laboratory which is the ‘go to’ facility in the South African winelands for a vast range of analyses and tests. It’s a business which almost exclusively employs women and is set to move into a new, purpose-built facility in January 2018.

“Looking back now I can’t believe I did it."  Many of the wine farmers that she called on were total strangers – like Giorgio dalla Cia of Meerlust. “He didn’t know me from a bar of soap – but he later told me that he could see I was trustworthy and passionate about what I believed in.” Dalla Cia, who happened to pass by our table at Pané e Vino while the interview was being conducted, dropped a familiar –  avuncular – kiss on Hanneli's head and said: “I was right to trust her! Look at what she’s achieved with VinLab. Amazing! I’ve got to know her over the years and I’m so proud of her. The industry needed her and her independence.” Not only did he pledge R10 000 immediately, he phoned up a few friends in the industry and advised them to do the same. Word spread and soon she had miffed wine farmers ringing up wanting to know why she hadn’t approached them... and then volunteering to help her.

Starting off a zero base (ie – with no money) Hanneli took her R650 000 in pledges which was matched by a R650 000 bank loan (which almost fell through...but that’s another story which speaks to her powers of persuasion!) and bought the R1.2 million piece of equipment she needed to kickstart VinLab.

Her years working in a few laboratories taught her a number of things which she has subsequently applied at VinLab. “Most were hard years. It wasn’t just about the lab work; it was as much about how people were treated in a working environment. Their value – or lack thereof – as individuals.” Treat people well and they’ll be motivated which is what she does at Vinlab.

Hanneli admits she has an independent streak a mile wide. She doesn’t want to be dependent on anyone.  “I also didn’t realize that impatience can be a positive trait ....  ringing phones frustrate me!"  Not one to wait for things to happen, she went out and MADE them happen! A visit to  Vinfruco Stellenbosch, cap in hand, is what kickstarted the process. “I saw this empty lab next door. I walked in and it’s as if it was waiting for me.” Instead of asking for a job, she offered to do whatever laboratory analysis Vinfruco needed using the premises as her own space. A sweetheart deal with a rent of R2 000 a month and it was hers.

And that’s where her fundraising kicked in. The debentures she offered were redeemable in 5 years and were paid back with interest. Those wine farmers who held debentures still receive a 7% discount on all lab tests, even the expensive gas chromatography and water ones.

Back in 2001 the sort of analyses wineries needed were fairly basic – sugar and alcohol levels, acid and extract measurements and the like. If they lacked their own facilities, they had to rely on the KWV’s lab or Department of Agriculture. “There were no private labs so the timing was perfect.” 

Over the years VinLab has grown and grown to the point where it’s bursting at the seams, bristling with whirring expensive GC (gas chromatography) machines and the like. The spectrum of services offered has expanded to include cork and aroma  testing.  More recently the business has extended into the beer, cider and spirit field. “Clients are requesting our involvement rather than us going out and deciding to grow into these areas,” she said. It also spent six months gaining the stringent accreditation necessary as a water testing facility – and the demand for it has vindicated the time, money and effort invested. Now Vinlab have two ICP's running at full capacity.

Service is something core to Hanneli's business ethos. VinLab should over-deliver on service, she believes. It’s why wine farms in Robertson, Paarl, Wellington, Franschhoek and even as far as Hermanus and Walker Bay get quick turnaround – and aren’t charged a fee for pickup or delivery of samples. “We started fetching samples in Robertson twice a week – now it’s daily! And we do it because the volume of work is available.”

VinLab’s  model is of the Walmart “stack ’em’ high and sell ’em cheap” variety. Make a small margin but let the volume multiply the benefit. For the first five years she never even increased her prices – “until the year Jan, my accountant,  told me I wasn’t going to make a profit! I got a fright and put the prices up – but not by much.” Last year’s increase was a scant 5% when inflation is running at way more than that.

What about the working environment and the human dynamic? VinLab’s new premises which have been in the works for four years sees their current – cramped – 450m² improve to 700m² and include optional extras which Hanneli is adamant HAD to be included; like the shower facilities for her staff, a chill out area which includes a deck and built-in braai, complete with designer swing chairs and a gym. There is also a new sensory appreciation area planned – which will be available to anyone in the industry. “I’ve seen winemakers meeting with buyers or agents in coffee shops which is really not a great environment to try and sell your product. From next year they can use VinLab’s spot if it’s convenient for them and they want to.”

“I never set out to solely employ women; it pretty much happened that way organically because of the dynamics.” Of the 34 people employed by VinLab, four are male. She appreciates the female work ethic, It’s what saw her and her first five employees start early and work late to deliver on their promise to give the farms their results as swiftly as possible. Some days Hanneli started working 3am and finished at 11pm. “We don’t have a rule book or policies about things such as cell phones or clocking in or out. We believe in employing people who are sufficiently self-motivated to realise the responsibility they have to deliver and to be accountable as members of the team – to VinLab, their colleagues and to the client.” And Hanneli leads by example.

Most, if not all, employees – even admin staff, have a science background – because Hanneli believes in the training and thought processes that requires of individuals. Staff are given room to grow. “I accept that someone with a science degree will ultimately get bored running basic acid titrations or simple analyses day in and day out. So long as it’s justified, I allow people to grow into new areas. They know their strengths better than I do so I allow them the scope to develop.” It’s why one of her staff with an interest in writing, authored the VinLab handbook for the wine industry, explaining all the testing they do, the faults they find and the causes thereof. “We’re here not to run the tests and give numbers but to give answers about how and why and hopefully help prevent problems going forward.”

And it also explains why two employees this year spent two weeks in England and Ireland touring beer and cider facilities, learning as much as they could about the production process in order to apply that knowledge when they run the beer lab.

Just 16 years on from starting up Hanneli is inordinately proud that VinLab is on par with what the rest of the world can offer. In fact, some winemakers with international experience believe it’s better. And there have been challenges along the way.

Hanneli acknowledges she is in a fortunate position of having a thriving business because the wine industry believed in her and carried her – so where she can, she pays it back: supporting winemakers going out on their own with either a waiver of testing fees or generous discounts.

“VinLab wouldn’t be here without the winemakers/farmers. They supported me financially – and they still support VinLab with their business. I cannot give enough credit to the people who have worked with me over the years. For me, it’s all about relationships – with the farms, with the winemakers and with my colleagues.”

It’s illustrative that she said people work “with” her rather than “for” her... Call it old-fashioned – like knocking on doors was – but it’s charming, and it’s paid dividends for this strong, motivated woman.

-Fiona McDonald