Decisions: The founder of Villa Maria sells 750,000 cases of wine a year, but success hasn't come easy
By Elizabeth Anderson Thursday, 01 November 2012
Sir George Fistonich, the founder of the New Zealand winemaker Villa Maria Estate, explains his best decisions in business...and his worst.
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MY BEST DECISIONS...
One of my best decisions was to change careers and go into winemaking, aged 21. As the second son of Croatian immigrants, I was expected to learn a trade. I became a carpenter and joiner, but I found the building trade restrictive. I leased five acres of land in Auckland from my parents and half an acre of grapes. I knew the basics of winemaking and bought all the equipment for $3,000 from an ex-RAF pilot.
When I started in 1961, Villa Maria was a one-man band, but it eventually developed a reputation as a boutique wine company. A big decision was to buy the Vidal winery in Hawkes Bay for around $30,000 in 1976. My bank thought I was crazy, so I found another lender - and the risk paid off. I now had 100 acres of grapes and could make 20,000 cases a year - double what I'd been making before.
Villa Maria also led the way in using screw-caps; all our wine has been screw-capped since 2001. About 95% of wine sold in New Zealand was cork-topped but there were lots of problems with quality. Now 97% of wine in Australia is screw-capped.
MY WORST DECISIONS...
I went into receivership in the mid-1980s after losing $4m. I was bulldozed out of business by large corporations trying to cash in on the growing wine industry. They slashed their prices and we had to follow. It did a huge amount of damage. But four months later we turned it around. I got a business partner, sold my house and borrowed enough to buy back half the company for around $1m. Fifteen years ago, I bought it all back.
The biggest cost in any business is employing the wrong people and not following your heart. The worst decisions I've made include employing people I wasn't satisfied with. On paper they were perfect, but sometimes instinct tells you different and I didn't follow my intuition.
Being too cautious
Twenty years ago, there was an opportunity to buy more vineyards in Marlborough. I decided not to because I was cautious about debt after going into receivership. The price of that land has increased tenfold since, so I guess that's a mistake. But we're not doing badly: After 50 years in business we produce 750,000 cases a year, sell to more than 50 countries, and have a turnover of NZ$100m (£51m).