CODORNIU

Codorníu is a Catalan cava-producer company founded in the middle of the 16th Century. Before 1872 the company produced normal wine and in this year, Josep Raventós i Fatjó, the owner, after visiting the Champagne region, in France, where he learned the Champanoise Method, produced his first bottles of sparkling wine  (cava) with its own identity. In the next decade, in 1885, Josep’s son, Manuel Raventós, took over the family business and became convinced that the family’s sparkling wines had a promising future. After seeking the advice of leading French wine producers he decided that Codorníu should devote itself exclusively to the production of sparkling wine by the traditional method.

Codorníu had some difficulties in 1887. Phylloxera, an illness that affected grapes, devastated the Penedès region and this caused the need of replanting all the family vineyards with grafts from healthy plants. Then, this problem was solved and in 1895 a new winery was planned. At that time, Codorníu’s annual cava production amounted to some one hundred thousand bottles. Two years later, in 1897, HM the Queen Regent María Cristina granted Codorníu the title of ‘Purveyor to the Spanish Royal Household’. Since that time, Codorníu has been a royal supplier and has produced an exclusive special reserve for the Zarzuela Palace.

The company began exporting to Cuba and Argentina and obtained international recognition in the form of a gold medal at the Antwerp World Fair and, a year later, at Bordeaux. Related to this, Codorníu was Catalonia’s principal agricultural exporter and one of the most important in Spain. But, apart from being and exporting company with 100 workers, in 1904, the company sold half the sparkling wine consumed in Spain during this year.

Innovation has been always important, but specially in 1914. Because of the business was growing a lot, they needed more grapes, which are the raw material to produce wine. This is the reason why Manuel Raventós bought 3,500 hectares of desert land in Lleida to plant vineyards that would supply Codorníu increasing production. After that, he left the management in Sant Sadurní in the hands of his sons, especially the eldest, Manuel. The tenacity of the Raventós family allowed them to reach the production figure of 300,000 bottles by using the latest technology.

In the 1920s, and until the 1930s, cava bolstered up its position in the Spanish market and Codorníu expanded over all the national market. Also, the company became stronger and developed internationally and growth was consolidated in the 1960s.

Codorníu is a 100% familiar company that is not listed in the stock market. It has 208 shareholders, all family members belonging to four generations. Despite this large number of close relatives to the company only 4 of them are fully integrated in the management of the company. The President is Mar Reventós, the General Director is Xavier Pagés, the Grapes Producer Manager is Xavier Farré and the Quality Manager is Ricard Raventós.

Codorníu Group (Codorníu SA) owns in total 12 companies and participates in 14, having a minimum percentage of 10% of the shares. Most of these are related to the sector of wine and cava and are located in Spain and around the world.  Some of the companies are subsidiaries in those countries. These enterprises produce wine and cava, others are distributors or work in packaging sector.

Figure: some of the companies that belong to Codorníu Group and their location.

Source: “Associació Catalana de Comptabilitat i Direcció”. http://www.accid.org/congres/programa/raventos.pdf

Talking about brands, the group owns a total of 145 brands. Within Codorníu, a company owned by Codorníu Group, have currently 12 registered trademarks that are 12 business units of the company. Each brand is a different kind of cava and has different prices. These brands are Codorníu Pinot Noir, Anna Codorníu, Jaume Codorníu, Codorníu 1551, Clásico Reserva, Extra de Codorníu, Gran Cremant, Benjamín, Anna Brut Rosé, Gran Plus Ultra, Reina María Cristina and Non Plus Ultra.

Regarding the international expansion of the company, in 1885, 10 years after the first bottle of cava was produced, Codorníu decided to expand.  Specifically, in 1894 the company began to export its products to the Cuban and the Argentine market. In the 1930’s the company grew and expanded into many other markets, mainly in Europe. In 1970, the group began to export directly to Japan from Spain. First, in this country the company only had a distributor, but in the year 2000, Codorníu established an office in Japan to promote cava and continue collaborating with other Japanese distributors.

In the year 1975 the group acquired the company Bach, which produces cava, but also wine. In 1979 created a new winery in the province of Lleida (Catalonia) called Raimat and in 1991, entered in the U.S. market by buying vineyards in Napa Valley (California) and creating a producer of wine (Artesa ). Continuing again with the domestic acquisitions to produce other geographical varieties, as with Bach did, Codorníu Group acquired 87% shares of Bodegas Bilbao in 1997. One year later, bought Legaris in the Autonomic Community of Castilla y León.

In 1999 in Argentina (Mendoza), Codorníu SA created a production wine company called Septimo, which produces for the Argentine market (10%) and the rest is exported to the rest of America. A year later, in 2000, in Catalonia acquired 25% of the shares of Scala Dei Cellers, a company located in Priority (Catalonia). After that, in 2001, it entirely bought the company called Abadía de Poblet, located in the region called Conca de Barberà, in Catalonia too. Finally, in 2002 the company also acquired a company in Spain, Nuviana, specialised in the production of Aragonese wines. Because of all these acquisitions and expansions, the group owns almost 3,500 hectares of vineyards around the world.

Figure: evolution of the expansions of Codorníu Group.

Source: “Associació Catalana de Comptabilitat i Direcció”. http://www.accid.org/congres/programa/raventos.pdf

Nowadays, 50% of sales come from business outside Spain and the UK has become the main buyer of exports of the group, with 24 million Euros on sales in 2010. This quantity represented a 35% of total exports. In the second position, there is the United States, with 22%

of the exports. The group Codorníu also has presence in 90 countries and has 10 sales offices outside Spain: in Argentina, UK, Brazil, Sweden, Japan, Finland, and United States (in this country have two), Germany and China. In Spain, representing the other 50% of sales, the group has 26 offices, keeping headquarters in Esplugues de Llobregat (Catalonia).

Finally, the main success of Codorníu Group is the way the group has faced the economic crisis. The company had the capacity to overcome the losses in 2009 caused by a reduction in consumption in the Spanish market and a decreasing of cava consumers that have opted for French champagne. This was possible thanks to exports and to the good distribution network and logistics that the company has. Other successes that the company can be proud of are marketing campaigns, especially those done in Christmas time, when, at least in the Spanish and Catalan markets, cava consumption increases significantly.

Cheers!