UK wine trade: ‘the best of times, the worst of times’

It’s ‘the best of times and the worst of times’ for UK wine businesses, according to Andrew Hawes, managing director of London-based wine shipper Mentzendorff.

The situation for suppliers to the UK wine trade have been challenging for some time, and are likely to become even harder, according to Andrew Hawes

Using the famous opening sentence from A Tale of Two Cities by Charles Dickens, Hawes employed the phrase to describe the challenges for established brands in Britain’s grocers, and opportunities for more obscure wines in the country’s independent retailers and restaurants, when discussing the UK market with the drinks business last month.

He explained, “Things have been getting tougher for major lines and key brands – the bread and butter for many businesses – for a long while, and it will probably get tougher.”

Citing the impact of Brexit, increasing cost pressure from supermarkets, coupled with range reductions in the major multiple retailers, along with a change in consumer behaviour, he told db that the situation for suppliers to the UK wine trade have been challenging for some time, but were likely to become even harder.

“There is price pressure, margin pressure and less room on the shelves,” he stated, while noting that UK consumers “have different values, they fundamentally don’t want the same things anymore.”

In other words, it’s becoming harder to sell mainstream brand wines through the supermarkets in the UK and make a profit, a situation that is exacerbated by both the rise of the discounters, and the falling value of the Sterling post Brexit. At the same time, it’s becoming trickier to find a home for well-known labels outside the multiple retailers due to a greater focus by trade buyers from independents and restaurants on more obscure wines from lesser-known regions.

Nevertheless, this latter development has meant that Hawes is also observing a “host of new opportunities” as UK buyers and consumers become “more receptive to quirkier wines”, helped by better and more widespread digital marketing and online retailing.

By way of example, he cited the rise in demand for the traditional method sparkling wines from Langlois-Château, a Crémant de Loire owned by the Bollinger family since 1973.

Andrew Hawes is chairman of the UK Champagne Agents Association and managing director of Mentzendorff, the UK importer and distributor for Bollinger

In particular, he recorded that the brand’s prestige cuvée called Quadrille – which retails for around £20 – had enjoyed a spike in demand.

“We have sold more Quadrille in the last few weeks that we have in the last few years,” he said, attributing the sales success to an interest from the top-end London on-trade in sparkling wines other than Champagne – primarily because on-trade buyers are looking beyond the default option.

Speaking specifically about the approach to selling wine to consumers in London’s restaurants, he said, “We are seeing more smaller, agile operators, and they are targeting a captive group of customers with a new and quirkier offer, and it’s working, their customers are coming back for more.”

Turning his thoughts to Champagne, and it’s role in this changing market, he commented, “Champagne doesn’t naturally have a superior position, and it should be explaining itself, and it has a lot to say about what makes it special.”

He also said that the famous French sparkling wine region needed to be more accepting of the competition.

“I think Champagne needs to relax a bit and say there is fantastic sparkling wine from England, the Loire, California… but say that it’s a different style – there is no point being in denial.”

Indeed, he said that he believed there was an opportunity for “a cross-sparkling tasting” for the UK trade, following news that the Comité Champagne was cancelling its Annual Tasting, which is held each year in London in March.