Wine distribution comes in a range of forms. At one extreme end of the scale is what one might call the ‘hands-off’ model traditionally favoured by the Bordeaux châteaux that have effectively delegated sales to négociant members of the virtual Place de Bordeaux. Discussing money directly with merchants from outside the region, let alone the people who will drink their wine, has not been to the taste of the Bordelais winemakers.
At the other extreme, there are the New World wineries that aim to sell all, or almost all, of their wine directly to the final consumer, quite possibly via some form of subscription scheme.
Most producers have, of course, followed a middle course, relying on importers or agents and retailers in each of the markets in which they distribute their wine.
Now, however, we are seeing the growth of ‘hybrid’ distribution. The term was used – in a press release by the London Stock Exchange, no less – to describe the new relationship between the English winery Gusbourne and Enotria Coe, one of Britain’s leading distributors.
Broadening the reach
“The innovative partnership is expected to broaden the reach of Gusbourne's wines within the UK on trade and is expected to drive incremental sales... [It] allows Gusbourne to continue to [form] partnerships with top-tier hotels, restaurants, and bars... Now, with Enotria Coe's support, Gusbourne [will bring] its award-winning wines to even more hospitality establishments throughout the UK.”
In other words, while acknowledging the need for a distributor with broad reach, the winery has decided that it wants to hold onto key sales relationships it has already created and wants to create. Managing this combined effort may be… interesting.
But, of course, there is nothing really new about various forms of hybrid distribution. Apologists for la Place de Bordeaux are quick to boast about how many Super Tuscans and Napa stars have joined it in recent years. What they fail to mention is how, unlike the French who give the négociants global carte blanche, the owners of these same wines have held onto their existing distribution in key markets. When an American buys a bottle of Opus One in New York, no Gallic négociant is involved. Ornellaia is globally sold exclusively by la Place – except in those unimportant markets: US, Canada and Europe.
As Florence Cathiard also recently revealed to Jancis Robinson, La Place’s exclusive distribution of her and her husband’s Chateau Smith Haut Lafitte wines does not extend as far as the retail operation in their Napa winery.
Châteaux and négociants
Buyers – including Chinese wanting to cut out the middle-man – asking to buy directly from estates like the fictional family-owned Château Machin-Truc in the Médoc are routinely told by its owner that they have to deal with a négociant – such as the ‘entirely separate’ Maison Machin-Truc which just happens to be run by his brother.
When questions were asked earlier this year about how the French supermarket chain Carrefour came to sell a Bordeaux wine called Comte de Maignac for €1.66 per bottle, it was explained that this promotional price was ‘entirely funded’ by the négociant (and member of la Place) Maison Johanès Boubée. For anyone to suggest that the decision to do so was in any way influenced by Maison Johanès Boubée being a Carrefour subsidiary would be mischievous.
Distribution - of Bordeaux and every other kind of wine – is increasingly complex, globally and within markets, as producers juggle between large and small on- and off-trade customers and the growing appeal of Direct-to Consumer sales.
How many well-heeled lovers of Moët-Hennessy wine brands like Dom Perignon and Joseph Phelps know they can become private customers of the luxury giant and save themselves the trouble of having to buy through a wine retailer? As Bordeaux heads into what is sure to be a tricky en primeur campaign next spring, how many estates will follow chateaux such as Fonplegade and Bellefont-Belcier in launching US-style subscription schemes?
In an increasingly tough wine market, producers and distributors may demand a lot more from each other, and new ways of working together and separately will emerge. Whether we call these new models 'hybrids' or come up with some other term, I'm betting that we're going to become increasingly used to them.
This column was edited on November 29th to include the penultimate paragraph which was inadvertently omitted.
The views and opinions expressed in the Devil's Advocate pieces are those of the writer, and do not necessarily reflect the views or positions of the publication. They are intended to provoke discussion and debate. If you would like to offer your own response to this or any other article, please email the editor-in-chief, Anja Zimmer at zimmer@meininger.de.
Don't forget to subscribe to our newsletter. Be the first to know and never miss out on important updates.
