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News
Chris Orr writes
“standfirst”>Just yesterday it was confirmed that Constellation are buying Vincor – which is about as big as news gets in the wine world. Details are a little bit sketchy, but fundamentally if the deal goes ahead without any problems, it will end up with Constellation controlling some 20-25% of the entire UK wine market, in terms of sales and brands.
So you can imagine that it’s the source of some quite hot gossip out in South Africa, where the latest Cape Wine show is currently underway with a plethora of Western Wines employees in attendance.
Talk at the conference ranges from, "poor guys" to "wow, how much money must they be making?" – neither of which is probably particularly helpful or accurate. But more disturbing is that most are talking about how damaging it will be for the UK market to have one company in charge of so much buying power. But is it really that bad?
The equivalent example is complaints about MacDonald’s and how it is ruining our children’s diet. Well, I’m a father – not a particularly good one, but as any American sitcom proves, dysfunctional families are best, so I live in hope. But as a bad father, I occasionally take my children to MaccyDs when the nagging gets too much, or some other idiot of a parent decides to take their children and invite mine along. Am I bovvvvered? No, not really.
And I feel very much the same way about the Constellation takeover of Vincor – or rather more accurately, not that bothered in terms of business.
The human impact is huge, of course, but that’s a different issue. In business terms, the implication from many corners is that it will further reduce the choice to the average consumer buying wine in a supermarket. So what? Anyone buying wine in a supermarket has made that choice already. They are actively choosing something mass market.
I shop at a supermarket. I buy my loo roll, my toothpaste, my washing powder etc from the local supermarket because I’d be an idiot not to. I can buy all of it cheaper than elsewhere, and still, in some cases, help save the environment or be Fairtrade friendly – none of which the little man in the corner shop can do for me. However, because he runs an excellent organic fruit and vegetable store next door, I can buy great potatoes, tomatoes, chillies, lettuce etc from him. I can also opt – as I do more often than not – to take my children to the local organic café for lunch on a Saturday morning, and on the way back swing by the local Spanish deli and buy some delicious cold meats and great fresh anchovies and a sweetie or two for the kids (I’m not that bad a father really).
And I can do that because I have a choice. The Spanish deli is there, not because it is a historical store in the heart of Hove, but because it was set up a year and a half ago by an entrepreneurial guy who realized that people like me wanted wonderful produce on their doorstep and use the supermarkets for a limited number of things. And that’s exactly the same way I view the Constellation takeover. It doesn’t limit choice to anyone but those who want – and some may say need – a limit. For the rest of us, as long as there are enough people who are brave and bold enough to set up independent specialist retail environments, the Constellation takeover is just one more opportunity to market diversity to an ever growing number of people that are desperate for something interesting, new and hand-sold. Which is no bad thing really, I think.
Chris Orr db 5th April 2006