CBI Market channels and segments: Wine in the United Kingdom

Introduction

Wine trade in the United Kingdom (UK) is dominated by supermarkets, which increasingly sell private labels and import bulk wine from developing countries to save costs. Reaching this channel can best be done through an importer, mitigating your risks of dealing directly with supermarkets. At the same time, opportunities can increasingly be found for low-volume suppliers, at the emerging independent specialists.

Trade channels

The trade channels for wine in the UK are presented in Figure 1. A further explanation of the channels can be found under Annex 1.

Figure 1: Trade channels for wine in the UK

Buyer concentration makes long-term relationship important

The UK market has a small number of large wine buyers. The off-trade (around 10 supermarket chains and speciality shops) dominates wine sales. Supermarkets have become very competitive in the field of wine in order to attract more consumers. Some of them focus on the premium segment, such as Waitrose, while others focus on low-priced bulk wines. All of them run frequent promotions which bring down the prices of wines. The big players have also established their own private labels, which have grown in popularity and are regarded as labels of quality. This dominant position of supermarkets is expected to strengthen further in the coming years.

Tips:

– Be consistent and trustworthy in your supply quality and quantity. Make sure your wine is always available; once buyers need to go elsewhere they do not come back.

– Engage in a long-term partnership with a UK importer or bottler, where you develop a buyer’s own brand, in order to split risks and profit more equally.

Independents offer opportunities for small-volume suppliers

Independent wine merchants, as opposed to larger specialist retail chains, are emerging in the UK wine market. They can differentiate themselves more, thereby addressing the consumers’ growing interest in wine. They are finding new customer bases, are building a more attractive assortment compared to supermarkets and have an innovative marketing and client approach. For example, they organise in-store wine tastings and winemaker events. The number of independent retailers in the UK has increased by 50% since 2007 to approximately 750 stores, excluding large retail chains (Decanter 2014). Specialist retail chains, as opposed to independents, are actually losing market share. The near bankruptcy of retail chain Oddbins is illustrative of this development. Their shops decreased in number from 278 in the late 1980s to 37 in 2012.

Tips:

  • Develop a unique selling point, like unusual origins, varieties, production/region stories, sustainability/organic or Fair trade certification.
  • Branding is very important in the premium segment in the UK.
  • Independent wine merchants can best be reached through an importer specialized in the off-trade.

Economic recovery: switching back to on-trade consumption

The economic crisis led to a significant decline in wine consumption in the UK, and a switch to the off-trade segment. Consuming wine at home saves costs. As the economy and consumer purchasing power grows again, the on-trade sector is recovering. Sales in restaurants, hotels and bars will increase. Exporters in developing countries can respond to this trend by focusing their distribution strategy on importers specialized in supplying on-trade channels.

Tip:

In times of economic adversity, more opportunities can be found in the off-trade sector. In contrast, in times of economic prosperity, opportunities in the on-trade increase.

Online sales

Online sales in the off-trade account for 11% of the market in the UK, ahead of the average for European countries (The Drinks Business 2015). In general, retailers with physical stores lead the development of online sales. Consumers need to know the retailer before they will rely on the information provided in the webshop. Nonetheless, many small premium wine importers without physical stores offer their wines through a webshop too. Premium wines sell well online as consumers are willing to pay more for a less common wine which they cannot buy at the supermarket. Read more on online sales in the CBI Product Factsheet: Online sales of wine in Europe.

Tips:

  • If you supply small volumes of premium wine, find an importer with a webshop which offers wines from original locations.
  • Webshops are particularly interesting retail channels for premium wines from developing countries, as they offer space to provide product information, such as a story about the history of the winery.

Segmentation of wine

The segmentation of the UK wine market is presented in figure 2. A further explanation of the figure can be found under Annex 2.

Figure 2 Market segments for wine in the UK, including indication of share in sales per segment and average retail price per bottle

Growing imports of bulk wine offer opportunities for high-volume suppliers

The UK increasingly imports bulk wine. The benefits of importing in bulk are many, but require a producer to be able to export large volumes of wine because a wine flexi-tank holds the equivalent of 32,000 bottles. This method reduces transport costs, delays the start of a wine’s shelf-life, and reduces the risk of damage to the bottles. The increased sales of private-label wines also stimulates bulk wine imports. However, the threat of being substituted is significant. It is therefore recommended to have a diversified client portfolio.

When supplying bulk wine you can target a supermarket, which you can target directly or via an importer, although retailers often use an importer in this case. The retailer or importer then bottles the wine in the UK. Supplying bulk wine directly to supermarkets is difficult, making an importer a more suitable channel. Listing fees and necessary promotions are financially problematic, making it difficult for a developing country exporter to successfully target this channel. Working with supermarkets therefore requires good price calculations and involves high risks, as the sales quantities are not guaranteed.

Tips:

  • When supplying bulk wine, you can only target supermarkets. The latter require large volumes against a relatively low price.
  • Importers can play a role in protecting producers from the high risks involved when trading with one big buyer, by spreading sales and to help with their understanding of supermarket requirements.

Continuity in supply is of crucial importance to the bulk buyers.

Strong middle segment

In contrast to many other European markets, the middle segment in the UK is strong. In the past decade, especially in the period of affluence before the economic crisis, the average quality of wines on the UK market has improved considerably. Only consumers that are sensitive to price points still buy simple table wine. Many other consumers do not accept the quality of wines in this low-end segment anymore. Instead, they purchase wines in the medium to sub-premium segment. This segment, consisting primarily of branded wines, is actually growing.

Particularly empty nesters, whose children have grown up and left the house, and people who have retired are good target groups for (sub-) premium wine.

Tip:

  • If the quality of your wine is considered to be moderate, improve the quality before trying to enter the British market or focus on supplying bulk wine.

Read the CBI Product Factsheet: Premium wine in the United Kingdom for more information on the respective market segment.

Differentiation in private labels

Retailers increasingly carry different private labels. As the share of private labels in total wine sales increases, from 26% in 2010 to 33% in 2012 (Wine Business International, 2013), the need for such differentiation also increases. In 2013, private labels accounted for 35.5% of still wine sales and 45% of sparkling wine sales in the UK (Harpers 2014). Commonly, private labels refer to the name of the retailer, such as ‘Tesco South African White Wine’. Retailers mostly position these private label wines, which are often made of relatively cheap bulk wines, in the low-end market segment. In addition to these cheap private label wines, retailers are also developing premium private label wines, such as ‘Tesco finest’ and private labels which do not carry the name of the retailer on the front. In the latter case, retailers develop a brand which cannot be recognised by consumers as a brand (i.e. private label) of the retailer. Only the label on the back of the bottle includes a reference to the retailer, as the owner of the brand.

Retailers will increasingly take control of the branding of wines, as it offers them several advantages. First and foremost, it gives them greater control over their supply chains, because they can switch between suppliers if needed. As long as the flavour profile of the total wine blend remains similar, they can change individual wines in their blend. Secondly, retailers can add value by branding and have all the resources they need to build strong brands.

Tips:

  • Supplying wine for private labels is particularly interesting for exporters whose activities focus on viticulture and wine-making. The supply of wine for private labels offers an opportunity to direct all resources towards the improvement of production, whether in terms of quality or quantity.
  • Supplying wine for private labels is only interesting for relatively large exporters, as retailers with private labels require large volumes, especially in the low-end market segment.
  • Mix private label wine supplies with branded wine supplies to remain an interesting partner for retailers, while also adding value through your own brand.

Comparing segments of promising export markets

Match your wine with the most suitable export market. Table 1 provides some insight into which product options are appreciated in each of the selected promising export markets.

For more detailed information on specific segments, please read the CBI PFS for Organic Wine in Europe, CBI Product Factsheet: Bulk wine in Europe or CBI Product Factsheet: Online wine sales in Europe.

Table 1 Matching your product with a promising wine market in the EU/EFTA

Annex 1: Explanation of trade channels in Figure 1

Cash and carries are a type of wholesaler that supplies the on-trade sector. They sell wines from their warehouse where customers pay on the spot (i.e. cash) and carry the goods away themselves. Developing country exporters which produce (smaller volumes of) higher quality wine, or fairly unknown/speciality types of wine can target the on-trade sector and thereby choose for a cash & carry to reach this segment.

Agents are independent companies who negotiate on behalf of their clients and act as intermediaries between buyer and seller. Agents do not take ownership of the products, nor keep stock. The commission of a sales agent varies from 3-5% for large volume supplies to 10% for smaller quantities. Agents are still active in the UK market, but their role is diminishing.

The traditional role of agents to source the best quality wines, manage logistics and help with the management of the product itself has shifted over the years. Currently, only the agents who are worth their margin and can justify themselves to retailers, succeed. Agents are still necessary because large off-trade channels, such as supermarkets, do not always have enough staff for sourcing activities. The agent’s role is to connect the retailer to new producers. Agents in the UK usually make strategic alliances with selected producers, in order to form shorter value and supply chains. Agencies often opt to become brand owners or co-owners of vineyards; this simplifies the value chain, while making the product more credible.

Importers: Developing country exporters which produce smaller volumes of wine, higher quality wine, or fairly unknown types of wine are advised to use an importer/distributor to enter the UK wine market. Importers can advise exporters on many issues, including legal and quality requirements, market trends and packaging.

Importers buy goods, of which they then take ownership and distribute to retailers, the on-trade sector, or re-export them to other countries. Importers are either specialised in selling to the on-trade sector, or the off-trade sector. Retailers often use an importer for less known wines, since importers then take care of the quality control. Importers generally add a mark-up to cover commissions, credit risk, after-sales service and the cost of carrying a local inventory to meet small orders. Their margin ranges from 15-25% of the selling price.

Regional wholesaler: A regional wholesaler serves as an intermediary between an importer and the on-trade sector. Developing country exporters, therefore, do not get involved with this channel directly. Although regional wholesalers remain an important channel in the UK, their role is declining.

Supermarkets are the dominant sales channel for wine in the UK, and this dominance is expected to strengthen further in the coming years. Supermarkets are a suitable channel for high-volume exporters, either bottled or in bulk. They import per container, so you need to be able to fill at least an entire container. The focus of supermarkets differs considerably in the UK. Some focus on quality wines and a reputable assortment while other focus on low-priced bulk wines. Their margin on the selling price is about 30%.

High listing fees can be problematic, making it difficult for a developing country exporter to successfully target this channel. Working with supermarkets therefore requires good price calculations and involves high risks, as the sales quantities are not guaranteed.

Specialist retailers: Specialist shops are small, look for higher quality wines, and usually buy their wines from an importer, specialised in the off-trade. This channel, therefore, can only be reached indirectly by developing country exporters. Their margin on the selling price is 30% or higher.

Different developments can be distinguished in the UK. The larger specialist chains are witnessing strong decline in their wine sales. Several chains have gone bankrupt, while others were forced to concentrate on the most profitable areas only (big cities, especially London). Independents, on the other hand, are an increasingly vibrant channel, and are expected to grow further in the coming years. There are approximately 750 independent specialised wine retailers in the UK.

On-trade: The on-trade sector consists of many small players, and therefore usually does not import directly. If you target the on-trade sector, you can supply an importer or wholesaler, which redirects your wine to the restaurants and other players in the UK market.

An importer with a high quality image can provide support in selling your wine to the on-trade, by making use of his image. Restaurants mostly look for wines with a reputable image and of a good quality. Sales by the on-trade sector are expected to remain stable in the coming years.

Online sales: Online sales are well developed in the UK, already accounting for 11% of total wine sales in the country, and they are expected to increase further in the coming years. In addition to the leading supermarkets and specialist shops,which often sell wine online, there are a number of online-only wine stores and wine clubs which are growing in popularity. Some supply to restaurants and stores in addition to customers, while most are oriented towards delivering wine directly to the consumer.

Annex 2: Explanation of market segments in Figure 2

High-volume:

High-volume trade plays an important role in the UK. It usually concerns lower quality wines suitable for the low-end market addressed by supermarkets. Competition on price is very high in this segment. High-volume wines are imported per container.

Low-volume:

Low-volume trade concerns bottled wine only, and usually involves speciality wines, of a high quality or with another unique selling point. Targeting the low-volume segment, therefore, requires at least some level of authenticity. Note that branding is important in the premium segment in the UK.

Bulk:

Bulk wine imports are increasing. You need to be able to export a large volume when supplying bulk wine; a thousand hectolitres is usually the minimum required quantity (20-25 thousand litres per shipment).

The private label market could be an opportunity for developing country producers, although it is also a risk, as buyers can more easily switch to other producers to make up their blends. As such, it is mostly interesting for developing country producers without a brand.

Bottled:

Exporting bottled wine is most suitable for smaller exporters and for producers of branded wines. Transportation is more expensive in this case, but value addition for developing countries is higher as well since bottling takes place in the producing country.

Supermarkets:

Supermarkets are the leading sales channel in the UK and a suitable channel for high-volume exporters. Supermarkets import per container and highly focus on price. However, listing fees are problematic, making it difficult for a developing country exporter to successfully target this channel.

Specialist retailers:

Specialist shops are small, look for higher quality wines, and usually buy their wines from an importer, specialised in the off-trade. This channel, therefore, can only be reached indirectly by developing country exporters.

On-trade:

The on-trade sector consists of many small players, and therefore usually does not import directly. If you target the ontrade sector, you can supply an importer or wholesaler, which redirects your wine to the restaurants and other players in the UK market. Restaurants mostly look for wines with a reputable image and of a good quality.

Online sales:

Compared to other Western wine markets, online sales play a large role in the UK. All sales channels engage in online selling as well as marketing. E-commerce is expected to become even more important in the future.

Source : CBI Market Intelligence

The Bulk Wine and Spirits Show Expands In London

International Bulk Wine and Spirits Show,London 2018.

Exhibitor Interest Form

Please fill out your contact information here and get a special launch code that will give you a flat 25% discount on the launch day (April 1, 2017) on London Exhibitor Registrations for the International Bulk Wine and Spirits Show. It will also give you complimentary session tickets to all sessions during the event. The fair is aimed to be your default Bulk Wine, Bulk Spirits and Private Label show for the European market with London as a hub city.

IBWSS exhibitors are wineries and distilleries looking to sell bulk wine and spirits, producers and negociants who offer contract manufacturing or private label programs, and wineries, distilleries and importers who have one-time excess stock to clear.

IBWSS buyers are wineries and distilleries looking to meet their demand, importers, retailers and distributors looking for private label programs, and negociants who are looking to meet new growers and producers.

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.

How to Have Your Own Wine Label Without Having a Winery

On the surface, it almost sounds like an oxymoron – having your own wine label without having a winery. But private label wines are becoming an increasingly popular segment of the U.S. wine market, and for good reason: launching your own private label wine can boost revenue, increase profit margins, and help you create a unique brand identity that sets you apart from the competition.

Perhaps the best example of a private label wine business taking off is the Kirkland Signature line of wines at Costco, which is already the #1 wine retailer in the U.S. Through its exclusive partnerships with wineries in the United States, Costco is able to offer unique, premium wines at half the cost anywhere else. Similarly, Trader Joe’s has sold over 50 million cases of its private label wine since 2002.

And a growing number of retailers – including some national wine and liquor chains and supermarkets – are following suit, viewing the private label wine business as a way to boost revenue and grow margins. According to some estimates, the margins on private label wine bottles are 10-15 percent higher than on bottles from national brands like Kendall Jackson and Barefoot.

Plus, as wine experts point out, retailers are essentially shortening their supply chain by squeezing out some of the middleman who are making their mark-ups every time they sell a case of wine. You are getting your wine direct from the winery, after all.

As a result, it’s no longer out of the ordinary to see private label wines show up on the shelves of supermarkets. Even a few national wine and spirits stores, such as Total Wine, now offer private label wines. According to the current estimates, private label wines now account for approximately 5 percent of all wines sold in the United States, and that figure could be headed higher. Some projections call for private label wines to eventually account for 20 percent of the entire market.

That would make private label wines roughly the equivalent of other private label goods (i.e. private label pasta, private label canned goods) that supermarkets now sell. And in France and Italy, the private label wine market is even more popular, accounting for nearly one-third of all wines sold.

In addition to the economic appeal of these private label wines, there’s also the branding aspect that can help to differentiate companies from other restaurants or retailers. For example, the legendary Italian restaurant Carmine’s in New York City has used private label wines as part of its overall branding strategy. It has worked with wineries to create a range of different wines – Pinot Grigio, Chianti, Prosecco, Montepulciano and Trebbiano – that it can offer to customers as examples of small, family-made wines, which can be enjoyed as part of a family-style feast. For families and tourists on a budget, it’s a way to create a welcoming wine menu that is also true to the restaurant’s overall brand.

The important point to keep in mind is that a private label wine doesn’t say “private label” on the bottle. To the casual wine drinker, it looks just like any other wine they might drink. While Costco and Trader Joe’s customers may realize they are drinking private label wines, that’s not necessarily true in the restaurant and hospitality business.

In general, private label wines are starting to catch on as customers become more adventurous and daring in their choices. They may not recognize the wine or the label, but are tempted to try it and experiment. And, as we’ve seen already, having an eye-catching label is often just as effective as having a first-class wine in terms of attracting attention. The “snob appeal” of avoiding private label wines, if there ever was any, appears to be fading. After all, the bottle, the cork, and the label are no different. It’s just a matter of convincing a customer to try a $10-15 bottle of wine they may not recognize instead of a bottle of wine that’s 2-3 times more expensive.

If anything, the major trend is towards private, exclusive wines that are grown in limited quantities. So that’s how businesses can choose to position their private label wines. Instead of being used to attract cost-conscious customers, it’s a way to attract affluent, sophisticated customers. That may not be true for Costco, which is focused on selling huge quantities at low prices, but it certain works for the hospitality business, where there is a constant search to differentiate oneself from the competition. As a result, everyone from a national chain of steakhouses to a small boutique hotel chain might be interested in creating a private label wine.

Bottles of white wine in a bottling plant

Which leads to the obvious question: How do you get started if you want to own your own private label?

The first step, say industry insiders, is to figure out the types of wines that your customers enjoy drinking and what the average price of the bottles they are ordering is. From there, you need to make a few projections about the growth projections of your business. You don’t want to be ordering thousands of cases of wine, and then be stuck with dead inventory. Also, since every label must denote the place of origin of the wine, the wines you select should be a natural fit for the restaurant in terms of region and style of wine.

From there, it’s time to reach out to wineries that might potentially be interested in a deal. Some wineries are able to accommodate a wide range of order sizes – everything from 5 cases to 1000 cases – while other wineries prefer only to work on smaller or larger order sizes. Once you’ve narrowed down your choices, the vintner will work with you on every aspect of creating your own wine – down to the creation of the label and even the type of cork. There are also independent design companies specializing in designing wine labels, cases and other promotional material. They will design a label that meets the specifications of the country you want to sell in and the tier you want to sell the wine in.

From there, all you have to do is place the order and you’ll soon have your private wine label, all without the time and expense of actually operating your own winery.

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.

Meet MGP : A leading Supplier of Premium Distilled Spirits at IBWSS

MGP

MGP is recognized across the country and abroad as a leading supplier of premium distilled spirits, as well as one of America’s top multi-line producers in the spirits industry. The company is also the largest U.S. supplier of rye whiskey, as well as distilled gin.

A core competency of MGP is the company’s expertise in helping customers create custom formulations. The company offers new distillate and aged spirits in railcar, tanker truck and tote quantities. Their extensive portfolio has continued to expand for today’s discerning tastes and currently includes:

  • Bourbons
  • Whiskeys
  • Gins
  • Grain Neutral Spirits
  • Non-GMO Grain Neutral Spirits

Based in Atchison, Kansas, where the company was founded in 1941, MGP also owns distillery operations in Lawrenceburg, Indiana. The company continues to consistently provide customers with premium products while maintaining state-of-the-art facilities and capabilities. Adding to this is MGP’s finely balanced mix of art and science, which is the cornerstone of their long history of success in helping customers meet evolving consumer tastes.

Among some of the more recent developments at MGP was the creation of four new distilled gins, each featuring a distinctive flavor profile. These include distilled orange, lemon-lime, citrus berry and cucumber gins.

MGP

MGP also embarked on a major warehouse expansion at their Lawrenceburg distillery, essentially doubling the facility’s whiskey maturation capacity.

MGP offers customers the ability to work onsite in a newly constructed distilled spirits innovation center. Located at the Lawrenceburg site, the center enables greater opportunities for customers to work closely with MGP in developing custom formulations unique to their individual brands. It also includes enhanced quality assurance and sensory labs, along with new conference and meeting space.

MGP

In recognition of the company’s growing prominence in the spirits industry, MGP was honored as 2015 Distiller of the Year by the prestigious trade publication, Whisky Advocate.

MGP

Meet and Explore MGP’s services at IBWS Show. The International Bulk Wine and Spirits Show (IBWSS) is an annual trade show and conference which will give wineries, importers, supermarkets, retailers, restaurants, distilleries and other buyers a premiere international platform to source bulk wine and spirits and meet private label suppliers. Book now and save on exhibitor rates 

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.

Key Retailers Like Marks & Spencer Drives Own Label Wine Growth

Mark & SpencerAndy Crossan, consumer insight director at Kantar Worldpanel told db that despite the challenges facing still wine from other drinks, especially sparkling wine and the booming popularity of gin, premium own labels had made strong gains in the latest 12 week-period as consumers trade up from cheaper branded lines and private label tiers.

“Premiumisation is a major theme in alcohol right now,” Crossan told db.”Still wine continues to face challenges from competing sectors like sparkling wine and gin, which have made significant gains from shoppers switching out of the sector.  However, there are promising signs as premium own label still wines gain more traction with shoppers in this vital period running up to Christmas.”

He highlighted that in the 12 weeks to 4 December, premium own label bottles – wines over the £8 price mark – had attracted 440,000 more households than in the same period last year.

“Shoppers returning to the still wine aisles have traded up from cheaper branded and private label tiers to these more premium options some 700,000 times,” he said.

One of the key drivers of this was UK retailer Mark & Spencer, he noted, which had seen a resurgence at this price point  “Just under half of still wine volume for the retailer has come from bottles over £8 in the last 12 weeks – up from 30% this time last year and taking shopper numbers within this tier to an all-time high of 1.1 million households,” he said.

“Of the big four, Tesco and Morrisons have seen penetration increase in premium private label, as has Aldi, which continues to expand its premium offering and appeal to an even wider range of shoppers.

Earlier this week the market analysts predicted strong growth of top tier own label lines across the board for Christmas.

M&S recently bolstered its range fine wines ahead of Christmas, after reporting “phenomenal” sales growth of over 40% sales growth in its fine wine range, and is set to boost the number of Simply Food outlets by 200 in a major two-year overhaul of its store estate.

In September, Tesco added more than 20 new lines to its own label range, which it said saw “significant” growth over the summer. The retailer has invested in its premium own-label range this year, with a successful Soho pop-up to promote its finest* range.

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.

IBWSS Super Early Bird Visitor Registration Now Open

The International Bulk Wine and Spirits Show (IBWSS) is an annual trade show and conference, open to trade professionals only, which takes place in San Francisco, CA. The event is dedicated to the business of bulk wine, bulk spirits, private label and contract bottling business. Join the biggest gathering of bulk wine, bulk spirits, contract bottling and private label business professionals.

WHO ARE THE VISITORS / BUYERS?
IBWSS visitors are buyers looking to meet up their demand of bulk wines, bulk spirits, private label programs, grape buying or contract manufacturing.Wineries, distilleries, importers, distributors, retailers, national and regional chains, negociants, brokerage firms and press members.

WHERE AND WHEN
July 26-27, 2017 – South San Francisco Conference Center (11am to 6pm)

ibwss

PRICING FOR VISITOR REGISTRATION:
Super Early Bird: $25 (Ends Oct 30,2016)
Early Bird: $35 (Ends March 30, 2017)
Regular: $55 (From April 2017)

Super Early Bird Visitors will get special discount codes for IBWSS conference and workshops.

CANCELLATION  / REFUND POLICY
Full refund if you cancel before May 30, 2017. No refund from June 1, 2017

EVENT PRODUCER
International Bulk Wine and Spirits Competition is brought to you by Beverage Trade Network, the leading online platform dedicated to connecting the global beverage industry. Beverage Trade Network (BTN) successfully connects wineries, breweries, distilleries and brand owners with international importers, distributors, brokers and beverage industry professionals on a daily basis. Strong partnerships with international and US organizations have helped BTN establish IBWSS as a premiere sales and marketing event committed to connecting the private label and bulk beverage industry.

Get your visitor trade pass at super early bird pricing and join the industry at International Bulk Wine and Spirits Show in San Francisco. Meet more than 80 exhibitors from all over the world offering private label, bulk wine, bulk spirits and contract winemaking services. (Register online) to save and avoid gate ticketing fee)

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.

Tesco Strengthens Own Label Wine Range

TescoTesco has boosted its own label range with the introduction of more than 20 new lines under its core and premium finest* wine range – which it says has seen “significant” growth over the summer.

The team has rolled out 39 new wines in total – twenty-two of which are own-label – with a further twelve available exclusively online. The move follows the revamp of 118 wines in its own label range in June, which saw it ditch the “confusing” ‘Vineyards World Wines’ and ‘Simply’ sub-brands, and move six wines previously available under the finest* range to the standard own label.

Tesco BWS team said the its wines has grown 2.9% since the revamp and it had seen a “significant increase” in the number of new customers and returning customers”.

However the move appears contrary to supplier research believed to be presented to the retailer over the summer which suggested Tesco had stripped out too many wines at the premium end during its range review last year, alienating a core section of its 40-something, middle-class customer-base.

The Drink Business team has learnt the retailer had called in suppliers to investigate boosting its £8-20 range bracket to plug the potential gap – but of the new additions to its store-range, only four (including a new finest* English sparkling from producer Hush Heath) retail above £10. Ten will retail on or below £5.50 with a further seven at the £6 – £6.99 ‘sweet spot’ and six retail between £7 – £8.99. A further twelve new wines are available exclusively online, priced from £54 and £120 per case (equivalent to £9-£20 per bottle).

Product development manager Graham Nash said the team’s simplification of the own label range had made it easier for consumers due to clear labeling and pricing. “Evolution is very much to get the own label tiering – [the range] is always evolving to cater for customers’ needs. As lot work done in the last year was in establishing a core range.

Read more at: The Drinks Business

If you are a winery looking to grow contract wine manufacturing or private label wine services, we encourage you to exhibit at IBWSS and join the largest gathering of private label wine professionals in the USA.

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.

Private Label Strategy To Grow Your Own Sales

private-labelWhat are the main reasons that your brewery, distillery, or winery should go the Private Label route to build your business? With continual growth across almost every category, the market is continually shifting to service the needs of new consumers and evolving trends.

This article is designed to offer several unique ways that certain Breweries (Craft Spirits and Wineries) can build high-performing brands for producers who want to fill a specific need in the marketplace.

There are eight steps that most brand owners review when going into the “Private Label” beer, wine and/or spirits business:

1.) Branding/Concept development—sourcing the customer with the need

2.) Researching and analyzing the concept

3.) Logo, Design and Prototype development

4.) Product Formulations, Flavor Development and Quality Assurance

5.) Business and Management Services
(Licensing, TTB Label Approvals,FDA Label Compliance, & Trademarking)

6.) Packaging/SKU Development

7.) Warehousing and Logistics

8.) Sales, Marketing and Distribution Support

There are many off-shoots of breweries and packaging facilities that offer their services to put private label beverages on the map. Some of them are set up strictly for producing blended beverages and/or carbonated soft drinks. Many produce bottled waters, fruit juices and energy drinks as well.

But the expansion and upgrading of old line breweries and packaging facilities, plus the addition of new business models in both the retail chain arena and craft beer hotbed, have developed some unique “one stop shops” for growing private label brands to gain access to these growing beer, wine and spirits markets—here are just a few:

Monarch Customer Beverages—Cold Spring, MN

Billed as a “Your single source solution for private label beverages and contract manufacturing.” Services provided include:
1.) Custom product, flavor and label development
(beer, energy drinks,CSD’s, and bottled water)

2.) Trademark searches

3.) Raw materials sourcing
(bottles, cans, labels, boxes, trays, ingredients)

4.) Bottling and packaging services
(glass, cans, multi-packs, PET, aluminum bottles)

5.) Production management
(scheduling, bottling, lab testing, analysis)

6.) Logistics, warehousing and distribution

U.S. Beverage Manufacturing—San Louis Obispo, CA

Billed as “Your Beverage Turnkey Solution.” Development Services they provide include:

1.) Personalized beverage development
(alcoholic bevs, coffee/teas, energy drinks/shots, kids drinks, CSD’s, Lemonade, sports drinks, and waters)

2.) Beverage packaging and label design
(Cans, bottles, bag-in-the-box,canisters, cartons, gift packs, PET, pouches, stick packs, tetra packs,tubes & hot bottles).

3.) Legal Services
(Licensing, Compliance, Trademarks and Brand Registration)

4.) Creative design and website services
(label, website and package design)

5.) Sales and Marketing
(distributor network, brokers, and retail chains)

6.) products, sauces and marinades, soups & vegetables, waters, energy beverages, and wines & spirits

City Brewery—La Crosse, WI

Billed as the “Premier Contract Beverage Producer” With State-of-the Art Plants in La Crosse, Latrobe, PA and Memphis, TN City Brewery’s professional services include:

1.) Unique beverage mix with beer, flavored malt beverages, energy drinks, teas and alcoholic cider.

2.) Brewing and aging cellars

3.) Blending and batching for FMB’s and beverages

4.) Packaging and unique configurations
(Bottles, cans, kegs, multi-packs, rainbow variety packs, cold fill, hot fill and shrink wrap capability)

5.) Quality assurance
(Analytical lab, package lab, micro lab, plant sanitation, data reporting, sample library, and CIP validation)

6.) Warehousing and logistics
(warehousing, logistics, transport, refrigeration/cooler space, rail car loading capability, and inventory)

7.) National footprint with three production facilities

Winery Exchange—Novato, CA

“Building Brands Worldwide” is their calling card. Winery Exchange professional services originate from their strong retail connections, including:

1.) Private label branding for Worldwide retailers
(Clients have included Kroger, Costco, Delhaize Group, Tesco, Fresh & Easy, Cost Plus, Whole Foods, H-E-B & Salisbury)

2.) Research
(Closely follow consumer trends in product categories, target pricing, and impactful packaging and l levels of brand support required to break through to consumers).

3.) Brand concept development
(Designs are presented to retailers based on research provided)

4.) Packaging Implementation
(Logistics, customer service, and distributor teams work with brand marketing to implement a new product)

5.) Marketing Programs
(Calendars are provided to gain displays, creative POS, in-store demos, and PR/press coverage)

6.) Winery Exchange uses Production facilities like City Brewery to bring their product to market.

BrewHub LLC—St. Louis, MO

“Today’s beverage landscape is changing”—a new concept in Craft Brewing, BrewHub is building 5 Craft Breweries of similar size at 75,000 barrels each in sunbelt and high growth craft beer areas. Their services are similar to the others, but have some significant differences, due to craft brewing methodology:

1.) Partner Brewing (50,000 sq ft facility, 75,000 barrels of available capacity, state-of-the-art brewing, packaging and warehousing set up fro small batches, flexibility to brew, package and co-pack multiple brands, tasting room fro clients to use with distributor/retail partners, and easy access for full goods transportation).

2.) Facility & Operations
(Fermentation, Brewing Options, Packaging Options, Refrigerated Storage, Central Distribution).

3.) Brewing Services & Options
(Ingredients, Batch sizes, mashing strategies, aging, custom hopping schemes, finishing and pasteurization).

4.) Laboratory Services
(Physical Analysis, Microbiological Analysis, Chemical Analysis).

5.) Sales and Distribution Services
(Distributor Agreements, Distributor and Retail Relationships, Inventory
Control and Rotation, Sales Training and Support, Sales Reporting Category Management, Pricing Strategy, Sales Incentives and Competitive Analysis).

6.) Marketing
(Market/Consumer Research, Brand Building, Labels/Packaging, POS, Sales Promotions, Special Events, Sponsorships, Media Plans, Public Relations).

7.) Export Opportunities
(international Contacts, Logistics, Legal Services, and Co-Packing).

Summary:
Market dynamics are constantly changing everywhere around us. Craft breweries are being built at a pace of three per day!!

The landscape of freight and logistics is scary due to high fuel prices, independent trucker declines and lack of suitable rail car services in smaller cities. The Craft Beer, Artisan Wine, and yet Craft Spirits Markets couldn’t be stronger and yet they compete in a very difficult economic environment. Growth continues as the consumer looks for “higher quality and better tasting, at the expense of less volume.”

The Beverage Companies listed above are all after another expanding segment in the U.S.—private label and contract beverages for the consumer looking for variety and good tasting brands at favorable prices. Private labels are being requested by retailers in today’s market – and not the plain old generic white beer cans.

The graphics are impactful, have appetite appeal, are eye-catching and taste great because of quality control and improved customer service by the larger players and focused companies. If you want a large size bottle with a diamond shaped label, in a 9 pack box, with varnish for consumer reaction, foil neck over wax and bottle conditioned product, there is a co-packer ready to that for you in every part of the U.S. today. Your “one stop shop” is a good way to pad your bottom line with custom orders.
As per the examples above, there are many ways to grow your company through innovative approaches to the market. It is important to study the market and identify any possible opportunities that can possible maximize your profits without putting you over your capacity.

Article source: BTN Academy

If you are a winery looking to grow contract wine manufacturing or private label wine services, we encourage you to exhibit at IBWSS and join the largest gathering of private labelwine professionals in the USA.

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.

Meet Growers Wine Group At IBWSS

growers-wine-group-logoGrowers Wine Group is a business consortium of four local Riverland wine growers. The winery is strategically positioned on the eastern perimeter in the key grape growing region of the Riverland, South Australia. With over 100 years of winemaking history, Growers Wine Group is the 15th largest winery in Australia by crush and one of the largest privately owned vineyard holders within South Australia.

Growers Wine Group provides every step of the Winemaking process from crush and ferment through to wine ready for bottling, including pre-vintage grape analysis, laboratory services and wine management for both domestic and international wine sales.

The team at Growers Wine Group are a young and enthusiastic company and are committed to producing the best wines possible using locally sourced grapes.

Their yearly crush is approximately 42,000 tonnes or 31,000,000 litres, and are committed to the quality and consistency of their wine product and therefore won’t compromise by trying to be the largest in the region.

Currently the company exports to United Kingdom, France, Sweden, Denmark, Germany, Canada, USA, New Zealand, China and Japan.

Growers wine group Company Specialties:

  • Bulk Wine
  • Packaged Wine for Buyers won Brand
  • Contract Processing
  • Specialized export team
  • Global Management to ship direct

Learn more : Growers Wine Group

Looking to develop a private label, source bulk wine or meet contract wine making suppliers?

Get your visitor trade pass and join the industry at International Bulk Wine and Spirits Show in San Francisco. Meet more than 80 exhibitors from all over the world offering private label, bulk wine, bulk spirits and contract winemaking services. (Register online) to save and avoid gate ticketing fee)

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.

Winery Classifieds

On this page you will find information about Winery Classifieds and different platforms where you can post them.

Winery classifieds are small advertisements placed in a newspaper or websites and organized in categories. Winery Classifieds ads are a great way to list winery equipment items, winery services, or properties for sale. Here are some of the websites and mediums that you can use to access winery classifieds.

WineBusiness.com – Wine Communications Group, Inc. is the leading information and services provider for the global wine industry. More info at: http://www.winebusiness.com/classifieds/

Wine_Business_Classifieds

WinerySite.com – An online service that helps the wine industry do their jobs better. We offer the most most widely read and comprehensive classified ad service. More information at https://www.winerysite.com/images/pdf/classifieds.pdf

Winery Classifieds

WineIndustryClassifieds.com.au:  Wine Industry Classifieds is an advertising hub for wineries, grape growers, organisations and suppliers within the wine industry in Australia to buy and sell new and used industry products & servicess at a fraction of the cost of conventional advertising.

Wine Industry Classifieds

VinoEnology.com: VinoEnology.com is a website that offers unique Winemaking Calculators, Industry Directory, Wine Catalog, Videos, Wine News, and B2B Marketplace where wine professionals can promote and market their companies, real estates, vines, grapes, bulk wines, spirits, wine barrels, winery equipment, winery supplies, chemicals, wine jobs and services.

VinoEnology

Regional Associations Classifieds: You will also find lot of associations and regional growers groups listing classifieds on their website. Here is are couple of examples. https://www.pasowine.com/classifieds/ and https://www.txwines.org/classified/

Paso_Robles_Wine_Country_Classifieds

Texas winery classfieds

Wines & Vines: Wines & Vines offers a comprehensive collection of products providing news, information, marketing and research capabilities. Our monthly magazine, Directory/Buyer’s Guide and Online Marketing System provides a wide range of solutions to give you the tools to be successful in the wine and grape industry.

Wines and Vines

BevSupplier.com  – Your one stop solution to sourcing all your winery, brewery or distillery services and products. BevSupplier is a global platform that includes listings of classifieds. More information at www.bevsupplier.com

Bev_Supplier

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.

 

An insider’s guide to the US bulk wine market

The original story was published in Meininger’s wine business international on 3rd August 2016.

Although the US is the world’s biggest importer of bulk wine in terms of value*, the market is surprisingly opaque.

Tim Hanni MW, a wine educator and consultant, says the challenge for international producers who want to enter the US market is “learning the intricacies of how bulk wine business is transacted”. Hanni MW,  who has helped to establish the USA’s first bulk wine trade fair, adds that it’s critical to establish “a network of connections to the brokers, buyers and sellers.”

The process starts with understanding how the US bulk wine market operates.

What is bulk wine?

Bulk wine is defined as wine that is shipped in containers (ISO tanks, Flexitanks etc), rather than in bottles or smaller packaging. Some organizations describe any wine that’s shipped in containers larger than two litres as bulk wine but, strictly speaking, bulk wine is wine that’s shipped in large containers and then repackaged at its destination.

Buyers can include wineries, importers, exporters or bottling facilities. Retail stores can also be significant bulk buyers, particularly if they’re selling ‘private label’ wines – the home brand wines created and sold by many liquor retail chains, supermarkets and grocery chain stores. The main advantage that private label wine offers retail chains is that it gives them control over the product, and eliminates the price competition from other retailers. After all, if they’re the only ones selling that brand of wine, then they don’t face pressure to discount it.

Bulk wine is typically traded in the US in one of three ways.

Tier One

The first and most important tier of the US bulk wine trade belongs to wine negociants or brokers. Turrentine Brokerage, Mancuso Wine Brokerage and The Ciatti Company, all based in California, are leading names in this space. Such brokers offer services ranging from grape and bulk wine brokerage to global bulk wine trading, evaluations and strategic branding. It’s not surprising that San Francisco is the hub of the bulk wine business, both domestically and internationally, given that it’s both within reach of more than 4,000 Californian wineries, as well as being a significant entry point to the US.

Brokerage firms may also offer ‘services as contract manufacturers or private label makers, a part of the business known as ‘custom crush’. This involves a buyer stating the profile of the wine required, which is then made to order by a winery. The buyer usually provides cartons and labels and the winery produces the finished goods.

The brokerage firms offer a great starting point for international bulk producers seeking to enter the US market, given their experience, knowledge and connections.

Tier Two

Wine industry classifieds make up the second strata of the bulk wine business. These classifieds may appear in newspapers, industry publications or online, through websites like winebusiness.com and Wine Country Classifieds (also distributed in print). The classifieds will list available bulk grapes, or the specifications of ready-made wines, and potential buyers then contact the supplier directly. Many wineries list bulk grapes and wines for sales on their regional association’s website. There are also web portals like Vinex and VinsenVRAC where buyers can negotiate on grape and bulk wine listings.

International producers may certainly list their products through these avenues, as long as they are able to take care of the legalities, logistics and price negotiations themselves.

Tier Three

The third section of the bulk wine trade market is known as the ‘whisper market’, where trade is conducted via personal relationships only. Products are not listed anywhere and nor is transactional data publicly available; nevertheless, this market accounts for a sizeable share of the bulk wine trade.

Insider information is circulated about how many gallons of wine are available for sale at which price, and buyers privy to this knowledge can arrange to taste the product and proceed with the purchase. Wineries can also let brokers know what wines they have for sale, and trust that the brokers will sell the product discreetly, without revealing where it came from.

Similarly, wineries or buyers looking to buy bulk wine can make their exact requirements known to a brokerage firm or negociant, who will then put the buyer in touch with a relevant winery.

This would be a trickier channel to explore for international bulk wine producers, at least until they have spent more time in the market and made deep connections within the network of bulk grape and wine buyers and sellers.

Why bulk wine?

Bulk wine is traded for many reasons, from the need to create a blend using a varietal that’s not available locally, to a need for more wine because of a poor vintage, all the way to private label. On the other side, producers sometimes have excess grapes or wine that they can’t use themselves, and the bulk wine market offers them a way to sell that excess. Wineries – unfortunately – also occasionally find themselves stuck with excess wine because a buyer has failed to make a payment or pick up the stock.

But although there are good reasons why the bulk market exists, there’s also a good reason why the whisper market exists. It’s commonly believed –wrongly – that excess wine is always poor quality. As a result, engaging openly in the bulk wine market has the potential to tarnish the reputation of a winery otherwise known for its award-winning wines.

This scenario presents an opportunity for buyers to procure bulk wines of excellent quality and use them judiciously to build new brands, or flesh out an existing wine portfolio – provided all players can navigate this complex market.

That’s why the International Bulk Wine and Spirits Show was created in the US – to put buyers and sellers together. “The IBWSS gives an advantage to international bulk wine buyers and sellers: access to the key players in the bulk wine business for both long- and short-term opportunities with the bonus of educational and informational seminars on important issues and how to expand their business in the US in a single location,” says Tim Hanni MW. “Attendees and exhibitors can save hundreds of hours and thousands of dollars by having everything, and everyone, in one convenient place.”

The US, whose consumption is estimated at 31m hL, has now broadly established itself as the largest domestic market in the world. At present, it buys international bulk wines mainly from Argentina, Chile and Canada. But given the growing strength of the US dollar and the emergence of powerful US retailers looking to build private label brands, there is a great opportunity for other countries to make a splash in the market. France, the largest bulk wine exporter in terms of value (29% of the world’s value) and Spain, the largest bulk wine exporter in terms of volume (23% of the world’s volume), are wine producing countries with a lot to offer this market, for example.

As ever, the key to success is making the right connections.

As ever, the key to success is making the right connections.

Sid Patel

bulk wine market

Sid Patel is the CEO and Founder of Beverage Trade Network(link is external), USA Trade Tasting(link is external)and the International Bulk Wine and Spirits Show(link is external). The International Bulk Wine and Spirits Show(link is external)(IBWSS) is an annual trade show and conference, open to trade professionals only, which will take place in San Francisco, CA from 26 to 27 July 2017.

Only 10 Spots are left to become an Exhibitor at the 2017 International Bulk Wine and Spirits ShowRegister Now and Join the show as an Exhibitor.