The Church Lady 

Profile

The Church Lady

An intrepid CGA and her husband are the force behind the rise of Blasted Church Vineyards in B.C.'s lush Okanagan Valley.

FROM: JAN-FEB 2005 ISSUE | BY JOHN SCHREINER

Evelyn Campbell, CGA, speculates that she and her husband Chris Campbell might never have purchased Blasted Church Vineyards if they had had to rely on a third party to draw up the business plan. "We looked at the winery and said, 'It really isn't a great idea; we are not going to make a lot of money, and it will be a long, long time before we do,'" she recounts. "We knew it all, and yet we decided to do it. An accountant, if he or she was a third party, would be at too much of a risk to advise a client to do something if it is borderline."

Like so many in the Canadian wine industry, the Campbells switched from other careers because winemaking promised an attractive lifestyle. A long-time city dweller, Evelyn now works from a small, cluttered mezzanine office in the winery. The windows look over the sun-dappled vineyards and the sage-covered hillsides of British Columbia's southern Okanagan Valley. A desk laden with financial and market reports keeps sharp the accounting skills she first used when operating her home-based business in Vancouver and, later, when she was controller of a privately held software company.

"I don't think we are any different from other people in B.C. and Alberta that would love to do the same thing that we did," Evelyn says, raising her voice to be heard over the laughter drifting up from the winery's well-patronized tasting room. "Many probably would never know where to start."

Running a winery has been every bit as challenging as the Campbells expected, if not more so. In November 2002, when they were only seven months into the wine business and still dangerously unseasoned, their first winemaker died in an accident at another winery. "Certainly, we saw ourselves in a position of not knowing how to carry on," Evelyn recalls.

It was then they discovered the special bond that exists among those who are passionate about wine. In a business-saving act of generosity, winemakers from competing wineries arrived to help finish making that harvest's wines for Blasted Church. Surviving such an ordeal is testament to the resilient business skills, including Evelyn's discipline as an accountant, which the couple brought to the winery from earlier careers.

The wine business was not entirely a leap into the unknown for the Campbells. Both started their careers in hotels and restaurants. Chris graduated in hotel management from the British Columbia Institute of Technology. After working at a series of restaurant jobs, he spent seven years at the Westin Bayshore in Vancouver, rising to assistant controller. Evelyn graduated in 1976 from a hotel management school in Austria. Returning to Canada, she worked in hotels in Montreal and Banff before ending up on staff at the Bayshore, where she met Chris.

Chris moved to the brokerage industry in 1982, joining Pemberton Securities and remaining with successor companies for most of the next 20 years, primarily in back-office accounting roles. Evelyn left the hotel industry when she acquired her CGA designation, because private practice offered the flexibility she needed to raise their two children and pursue a satisfying career.

"We're trained in the full range of accounting services, from the audit of large companies to small business," she says. "You can focus in on any area that you like when you have your designation. Right from the start, I chose to stay with small business. I had a good network of fellow CGAs for anything that I wasn't familiar with. This ability to network was perfect for my situation, not being in a big office and not having the hierarchy of bosses and partners." Once her children were in school, Evelyn joined a software company, spending four years as the controller.

But the Campbells left those careers because they wanted to run their own small business. They spent nearly three years methodically researching the B.C. wine industry, reviewing at least seven properties that were on the market. Their choices ranged from established properties that they judged overpriced to one fixer-upper, a shuttered winery with a neglected vineyard. Then they found Prpich Hills, a winery that long-time grape grower Dan Prpich had opened in 1998, six kilometres north of Okanagan Falls. Their banker told them they had found "a diamond in the rough."

The property included a 17-hectare vineyard on a plateau with a picture postcard view of Skaha Lake to the west. Prpich had built a large winery with underground cellars, with the capacity to grow to a significant medium-sized producer. The wine shop, an attractive log structure, was placed on a knoll in the vineyard to take advantage of the views over the vines, the lake, and the distant village of Kaleden across the lake. When the Campbells bought the property, the winery was producing about 1,000 cases of wine which, due to primitive winery equipment, was rather ordinary in quality. Butthe property was not overpriced and, as their banker pointed out, it had potential.

Evelyn's CGA skills, supplemented by the financial skills Chris had picked up in his previous career, enabled the couple to produce a business plan so thorough that their bank complimented them. "They said, 'We wish everybody's business plans looked like this,'" Chris recalls.

"We also, of course, rely on professionals to help us with marketing, viticulture, and winemaking," Evelyn says. "But other people would also have to rely on someone to help them develop a business plan. Many people would love to own a winery but need the professional background of expertise in accounting or business planning. It's been nice to use our own skills and then pick some wonderful talent along the way just to make sure that we know what we are doing."

The financial discipline at this winery is strict, as one would expect. "We know our costs down to a T," says Evelyn, who draws on her accounting knowledge to produce continually updated forecasts of the winery's revenues and expenses. In the autumn of 2003, these forecasts gave her early warning of a potential financial problem. In their initial years as winery owners, the Campbells sold some of their grapes to other wineries while building Blasted Church's sales.

But in 2003, the unusually hot summer reduced the vineyard yield, something they had not counted on. Evelyn's forecasts showed that the business would not have the cash to get through the winter unless grapes intended for their wines were sold to other wineries instead, but reducing wine production would cut into Blasted Church's accelerating sales momentum. The Campbells chose to sell fewer grapes rather than sacrificing their own wine production, while avoiding a cash crunch by bringing in a minority equity investor. "We found that the best policy is to correct any mistakes and move forward as quickly as possible, to stay on track with our forecast," Evelyn says.

In their previous careers, the Campbells had learned to call on experts when required. "I believe that all professionals have their value and they should be used whenever possible," Evelyn says. One of the first issues they faced on taking over the winery in the spring of 2002 was marketing. There was no name recognition to Prpich Hills, and very little to attract consumers to a backwater location not on any well-travelled wine route. (The winery is only 10 minutes south of Penticton, but just off the twisting and lightly travelled Eastside Road.)

The Campbells retained Bernie Hadley-Beauregard, a Vancouver marketing consultant, to come up with a new name and a new label. After screening hundreds of ideas, they settled on Blasted Church, with whimsical caricature labels dramatically different from the conservative labels everyone else was using then. The non-traditional labels were Evelyn's decision. "That's part of the side of me that is not a very rational numbers person," she laughs. "Chris and I make a good team. I am more the risk-taker."

There is a good story behind the Blasted Church name. A small church was dismantled in 1929 so it could be moved from Fairview, an abandoned mining town near Oliver, to Okanagan Falls. The moving crew set off a small dynamite charge inside the church to loosen the nails in the old timbers. The steeple was damaged but the building survived. The story resonates in most Blasted Church labels (a best-selling white wine is called Hatfield's Fuse) and has been very effective in giving the winery and the wines the high profile needed for success.

Because they were novices to the wine industry experience, the couple also retained both an experienced vineyard consultant and an experienced winemaker. Their business plan specifically called for a full-time trained winemaker. That turned out to be one of the most difficult parts of their plan.

Their first winemaker was microbiologist Frank Supernak, a Nanaimo native with 15 years of Okanagan winemaking experience. Tragically, Supernak died at another winery during a failed attempt to rescue another winemaker (both were asphyxiated by carbon dioxide in a tank of fermenting wine).

The Campbells searched globally for their new winemaker. Willem Grobbelaar, a skilled young South African, arrived to make the wines in 2003. Then, to the surprise of the Campbells, the Canadian government refused to extend his work permit. Forced to advertise a second time in 12 months, Blasted Church in 2004 was fortunate to find Australian Marcus Ansems. A graduate of Australia's top wine school, Ansems grew up in a winemaking family: when the immigration officer asked about his experience, he was able to say he picked his first grapes when he was five.

Settling the winemaking enabled the Campbells to move on to the next step: Liberating the potential of their "diamond in the rough" and offering wines whose quality generates a good margin. Evelyn believes that consumers will pay for quality and service "if you do it right. That had to do with some of the things that I learned in the CGA program as well," she adds.

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Vancouver writer John Schreiner now devotes himself to writing about the Canadian wine industry after completing a 40-year career as a business writer, editor, and bureau chief with The Financial Post. Whitecap Publishers has just released Schreiner's eighth wine book, The Wineries of British Columbia, with profiles of 126 wineries. In May 2005, Mitchell Beazley Publishers of London will release Schreiner's The Wines of Canada.