ASC strengthens on-trade and New World wines

ASC Fine Wines, China’s biggest wine importer by volume, will strengthen its on-trade sales sector and introduce more new brands from Australia and Chile for 2017, its chief operating officer revealed during the Chengdu Wine Fair this week.

Simon Wang, COO of ASC, presenting the company’s sales figure in 2016 in Chengdu

Speaking to the media on 22 March, Simon Wang, the newly appointed ASC COO, announced that in 2016, the company’s wine sales surpassed RMB 1 billion (US$145 million) generated from five main sales channels, namely direct sale, retail, distributor, e-commerce and hotels, restaurants and cafes (HORECA).

The total sales value, though experiencing some fluctuation recently, is more moderate and reasonable as Wang noted, compared with the 40% to 50% growth rates seen a few years back.

Its volume, however, dropped by 2% over 2015, as shown by figures compiled by Chinese Customs. Nonetheless, the executive stressed that the sales met expectations from the board.

Its HORECA sales, which account for 20% of its total sales, behind 27% for retail and 22% for e-commerce, will be a focus for its future growth, Wang noted.

“Wine sales start from hotels and restaurants as these channels are the most direct way to affect end consumers’ decisions,” he explained, adding that it will also continue to drive growth for e-commerce sector.

Meanwhile, in yet another announcement, the executive said that the company will reshuffle its portfolio to introduce more wines from Australia, Chile and Spain, in line with the three countries’ growing influence in China’s wine market. Australia is currently China’s second biggest wine export partner, followed by Chile and Spain based on value.

“In terms of tariff and value for money, we will invest more to develop brands from Australia, Chile and Spain. The changes you’ve seen in our portfolio are made based on these market figures,” he explained, referring to the launch of two of its new brands – Yalumba from Australia and Caliterra from Chile – to fill out the void after Treasury Wine Estates’ exit.

“The changes in brands reflects how the market has changed and matured. When a brand’s development deviates from our goal and philosophy, parting ways is natural, but it doesn’t rule out possibility for future cooperation,” he continued.

Addressing the new partnership with ASC, Carlos de Carlos, Errázuriz Asia managing director, commented: “We are happy to work with ASC. We have the same ambition to excel in quality and to offer consumers in China quality wines. We are very consistent with ASC’s strategy to grow the China market.”

Caliterra, owned by Errazuriz, was one of the first wineries in Colchagua Valley in central Chile. In May, Caliterra’s full ranges of wines is going to be released in mainland China.