Château de Sales in Pomerol has been owned by the same family for more than 500 years. The Sauvanelles hung onto it through the French Revolution, though their archives were burned and their home looted. Their descendants kept it intact through the German occupation of the Second World War.
But keeping it in the family for the next 50 years, much less the next 500, will be the real challenge. For a start, there are 45 people in the next generation with a stake in the property.
Long history
“My ancestors arrived in Château de Sales in 1464,” says president Marine Treppoz. Winemaking began in 1602 and the house, with its distinctive domed roof – a pigeonnier, or dovecote – was built in 1647.
Come the French Revolution, the men of the family left to fight against the new government, leaving the women behind in Bordeaux. “They went to jail, both the mother and the daughter,” says Treppoz. “They were freed only when Robespierre died. The house had not been destroyed, but emptied, and everything confiscated. They found only two chairs.” The two women borrowed money from friends and bought the estate back from the government, piece by piece. When the Germans arrived during the Second World War, her great-grandfather dumped vegetables in the great room that dominates the ground floor. The smell of rotting vegetables drove the Germans out to the orangerie, saving the house.
The family name may have changed several times over the years, but the estate has been a constant, passing finally to Treppoz’s mother, aunts and uncle, Bruno de Lambert. “My uncle was the farmer, so he was in charge of making the wine,” she says.
In 2011, De Lambert began thinking about retirement, and asked his sisters what to do with the 47.6ha property. This was not an easy question, as the four siblings had 14 children between them. Would some want to sell the property? Would some want to farm it?
Succession planning
This is the point at which many family businesses unravel. Business literature is full of case studies of enterprises that ceased to exist, usually for three reasons: an inability to solve conflicts and build trust; no clear vision for the future; and lack of tax planning.
The four siblings avoided these problems by taking a democratic approach. They created a questionnaire and circulated it among their children, telling each one to answer it anonymously.
“The surprise was that the 14 of us wanted to keep the property and transmit it to our kids,” says Treppoz, saying it was a place where everybody gathered for holidays and festivities. “We all knew that without a house, a family is very difficult. The link is transmitted by a house.” But to keep the house, “we needed to be in the winemaking business. The house, the business and the wine are intricately linked.”
The first task was to create a company. “It took five years during which we met each other to go over everything,” a process Treppoz says was gruelling. First, everyone discussed what they knew about inheritance, whether they had professional knowledge or had seen other people going through the process. “Second, we tried to ensure that everyone understood what the business was and how the wine was produced, and the key financials of that business.” There were meetings to discuss shareholder agreements. “That was a strong part of strengthening our trust and relationships. When you discuss shareholders, you discuss the worth of things. What happens if one wants to sell? If one dies and gives it to her husband, and the rest don’t get along with the husband?”
Some meetings ended in tears, “but at the end of the meetings we’d realise how strong the relationships were that we were building”. They agreed that shares cannot be sold outside the family, at least for the time being.
The next step was to build a business plan to improve the profitability of the estate, to ensure that future tax obligations can be met. This is a serious problem facing French wineries in prestige areas, and often results in families having to sell. France levies inheritance taxes of up to 45% of the value of land; in Pomerol, land prices start at about €26,000 ($28,975) per hectare, rising as high as €3.8m. But while Château de Sales’s land is extremely valuable, its 200,000 bottles sell for an average of €33. “The land value has increased dramatically and is not in line with the profitability of the wine business,” says Treppoz. Making the property financially viable is therefore a major priority.
The family appointed a managing director, Vincent Montigaud, formerly of Baron Philippe de Rothschild. Marine Treppoz, who is an insurance consultant, became the president, with a mandate to represent the estate. Family members were appointed to the board, along with one external member, Jean Pierre Foubet, directeur général of Chasse Spleen.
Treppoz says that when a business doesn’t have millions at its disposal, processes must be created to stop problems from developing. “We’ve tried to ensure everyone is trained and tried to be more precise at every step. From when you clean the place, the cellar, the transportation, every step was analysed and audited to make sure it was the best that can be done.”
Now the family are writing a charter. “We want to discuss what happens when you have an intersection between the business and the family,” she says. What happens if a family member wants to get married at the château, but a major client wants to book it that same day? “Who decides? Is it more important to have the event for the clients? We need to elect a group of people who will be the wise guys of the family.”
The next generation
Managing the desires of 14 people is tricky enough – but the next generation has 45 people. The one after that may have more than 100.
“We are trying to build the same kind of trust and love between all the 45 cousins as we have,” says Treppoz. “They have an event once a year where they play and spend two or three days together and don’t ask for help from us.” The family also makes an effort to keep them informed. “Every three months, we have a newsletter,” which tells everybody what’s going on and mentions the people who work on the estate, from the tractor driver to the vineyard workers. “We know the people quite well, but our children don’t know them.”
The intensive work is beginning to pay off, with marked improvements in wine quality, and increasing visibility.
Yet although Treppoz is determined to keep the estate in the family, she recognises that it’s also a national treasure. “You have to do as good a job as someone else could do,” she says. “Or you don’t deserve it.”
