Show Stoppers – Charlotte Hey

The LIWSF is meant to help the trade do business. Which means if you’re not there to take advantage of it, you probably shouldn’t be there at all

IT’S THE show season again. By the time this column appears in print, we’ll all be gearing up for the London International Wine and Spirits Fair, after having already pressed the flesh and flashed the press at Prowein and VinItaly. For those whose business it is to do business at such events, blistered feet, black teeth and aching limbs will be a recognisable side-effect of the gruelling circuit.

Surely there must be some official medical term – Fairfoot, perhaps? Or SAD (Show Affective Disorder)? Or maybe – and this is quite a technical term this one – simply completely knackered?  What can be interesting is to compare notes with people vis-à-vis their show tactics.

Some people are happy to spend three or four days wandering around a show, absorbing the atmosphere and generally allowing the main benefits of such events to be absorbed by a form of natural osmosis to the brain.  Others give themselves an hour or two – which is clearly realistic for something like Vinexpo with its 40,000m2 of exhibition space.  Not.

Personally, I prefer the well-prepared appointment system.  It’s less spontaneous, but it means you actually see people and talk to them and, well excuse me, I know this sounds a bit off the wall and all, but you actually do business.Which is, I guess, the prima facie reason for the very existence of these trade fairs.

And in most respects, it has to be said that the LIWSF is certainly one of those fairs where business is not only done, but it is pretty obviously seen to be done. 

It is probably partly due to the very close proximity of leading wine buyers to almost anybody who’s somebody in the world of wine and retail.  It’s also due to the expense.  From California and Chile, through Argentina and across to Europe, the cost involved in putting on a show at the LIWSF is not, as Mr Major would say, inconsiderable. 

The majority of VinItaly’s and also Vinexpo’s, exhibitors are of the national, rather than the international sort.  But because of the UK’s minimal domestic wine production, the majority of LIWSF exhibitors are international in flavour – even if their wares are on show via their UK agents.

Huge figures are regularly bandied around by members of the trade but no matter how much they are puffed up, it’s a fact that as a major brand or generic, you’ll be lucky to put on a good show and get much change out of £100,000, and in many cases it’s not uncommon for costs to run up to £200,000 or more. 

Putting that into context, if you work back from an average shelf price of £3.99 and then take away the supermarket’s margin at around 30% (on the low side) deduct duty, pull out cost, and allow a little for shipping, then before long your average middleman is perhaps making somewhere between 15p and 20p.

Producers could perhaps double that, but only if they were fairly miserly with their marketing budgets, and if they are fairly miserly they’re rather unlikely to be spending upwards of £100,000 on their presence at the LIWSF.

Which means the average major agent in the UK has to trade or generate orders in excess of 55,000 cases of wine just to stand still on a £100,000 investment in a stand at the show – let alone present positive growth. Of course there is undoubtedly a level of PR benefit that can be grasped over the four days of the show but that’s relatively insignificant in comparison to the amount of hard orders that need to be generated.  Which is perhaps why London is increasingly seen as a trade show in the proper sense. 

It isn’t – as it could have sometimes been in the past – simply an opportunity to catch up with a few old faces and skive off work for a couple of days. There are marketing opportunities with a cost attached on one side, and sales benefits on the other.

Last year as I rushed from one appointment to the next, I would occasionally stumble across aged trade fair visitors, mumbling into a glass of wine about "How large and unmanageable these things have become.

They used to be fun in the old days." Well, trade fairs aren’t meant to be fun – they’re meant to be useful – and they’re only unmanageable if you’ve failed to work out in advance who you want to see and what you want to achieve.  As a trade we’re increasingly taking ourselves seriously – some might say too seriously – and we’re realising that the majority of us are in it to make a profit, the healthier the better.

The LIWSF is meant to help the trade do that. Which means if you’re not there to take advantage of it, you probably shouldn’t be there at all. db

Charlotte Hey is publisher of The Drinks Business.