Giving China's wine-bottling ways a twist

Updated: 2012-11-16 11:23

By Lu Chang (China Daily)

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 Giving China's wine-bottling ways a twist

Enrico Perlo, general manager of Guala Closures Group's China operations, believes more Chinese wine producers will use screw caps instead of corks. Provided to China Daily

Producer says screw caps more convenient and effective than corks

The use of screw caps in the wine industry has in recent years gained a wider acceptance throughout the world. From reds to whites to sparkling wines, companies are slowly turning away from putting a cork in.

But in China, where people are quickly gaining a deeper appreciation for wine, most still associate a cork with value. Presenting a bottle of wine with a screw cap could be perceived as cheap and inelegant.

Giving China's wine-bottling ways a twist

All that is about to change, says Enrico Perlo, general manager of Guala Closures Group's China operations.

The company, which claims to be the world's largest producer of wine bottle screw caps, is banking on an influx of wine importers employing the practical, inexpensive caps.

"Some Chinese importers have already brought in screw-capped bottles of wine. For some Chinese consumers who generally don't know how to use a corkscrew, this makes screw caps less inimical and more convenient," Perlo says.

"Actually screw caps are already widely used in many countries, including Australia, New Zealand and the United States."

Perlo says screw caps are a sensible option in China because the wine culture is still young.

With an influx of imported wine from countries such as Australia, he adds, Chinese consumers will become more familiar with the convenience of screw caps.

A recent industry forecast that backs Perlo says that nearly 35-40 percent of wine bottles will use screw caps in 2015.

Last year, Guala Closures Group, based in Italy, sold more than 1.2 billion screw caps, an increase of 50 percent over the previous year. Globally, 3.5 billion wine bottles were sold with screw caps.

Perlo says more winemakers are shifting to screw caps because the traditional cork, which is made of bark from the cork oak tree that takes 12 years to grow, is not keeping pace with the world's burgeoning wine industry.

One of the cork's drawbacks is that it doesn't perfectly seal the bottle opening and protect the wine.

A study for the American Society for Enology and Viticulture showed that 45 percent of all corks leaked unwanted gas into the wine.

"A wine (bottle) closed with a screw cap was definitely in better shape than the one closed with cork," Perlo says. "It was fresher with more of its fruit. Screw caps will be the final solution to wine producers."

Grace Vineyard, a wine producer in North China's Shanxi province, started using screw caps for some of its vintage in 2011 and plans to switch closures this year for its entry-level and premium-level wines.

Found in many five-star hotels and restaurants in Beijing and Shanghai, the Grace Vineyard chardonnay ranks among the best of Chinese wines.

Perlo knows switching from corks to screw caps is a tough decision for a winery, but he says Grace's move is a good start and it means wine producers are listening to consumers and trying to put the best wine in the hands of Chinese consumers.

But Perlo admits that it hasn't been easy for wine producers in China to switch from cork.

At the moment Perlo is focusing the company's business on bottle closures for China's spirit industry, namely baijiu, a clear liquor distilled from grains including sorghum and rice.

He says the company's first contact with Chinese baijiu brands came in 1996 at a European spirit exhibition, during which Wuliangye and Moutai, the top Chinese baijiu brands, were looking for caps that would make it difficult for unauthorized producers to refill their bottles with fake spirits.

"It was them who contacted us because no Chinese packaging company had the technology of making non-refillable caps at that time to prevent people from refilling fake liquor in a restaurant or in a bar," Perlo says.

Since the exhibition, Perlo, who has been directly responsible for the company's Beijing office since 1998, has added several major baijiu brands such as Swellfun, now controlled by Diageo; Gujinggong, Langjiu and Wuliangchun.

"Packaging is something very important for distillers, especially when faking has become a serious problem in China," he says.

"Since we are specialized in the closure industry, we can give all the protection our clients need for their spirit."

In 2002, Perlo set up a plant in Beijing's Huairou district, an hour's ride from the center of the city and home to many food and beverage companies such as Mars, Red Bull and Coca-Cola.

Perlo also opened another office in Chengdu, Southwest China's Sichuan province, where many famous baijiu brands, such as Wu-liangye, Jiannanchun and Langjiu, are located.

China's contribution to Guala Closures Group's worldwide business is relatively small, representing a mere 3 percent, but the company has seen a growth rate of 10-15 percent over the past 10 years.

After commencing operations with less than 30 people, Perlo now has more than 100 employees and plans to further develop the market in China's rural areas.

He says he's had difficulties adapting to China's relationship-based society, in which business relies on social connections and friendships.

"For China, these things become a problem rather than a support to the industry because everyone has to be friends to do things which is not based on quality, efficiency, experience or knowledge," he says.

Perlo adds that the value of the company is related to a product's performance and not on guanxi, which means relationships in Chinese.

"I think the story of guanxi is against China itself," he says. "If you don't recognize this, your growth is based on what? Guanxi may make your company survive for a year, but eventually your company will die without skills and experience."

(China Daily 11/16/2012 page21)