Société Jacques Bollinger buys into fine wine merchant

Champagne Bollinger’s holding company, Société Jacques Bollinger (SJB), has taken a shareholding in London-based merchant BI Wines & Spirits as the French business aims to better understand the global fine wine market.

Left to right: BI managing director Gary Boom, BI chairman Michael Spencer, and SJB chairman Etienne Bizot

In an exclusive interview with the drinks business on Monday this week, SJB chairman Etienne Bizot explained his motives for the new partnership, which will give him a seat on the board at BI Wines & Spirits, a leading London-based specialist fine wine merchant, which is chaired by ICAP and NEX founder Michael Spencer.

Although the investment in BI gives SJB only “a minority” shareholding in the merchant, it benefits both businesses, with SJB gaining greater insight into fine wine consumer trends, and BI gaining increased funds to enhance its LiveTrade platform, both in terms of stockholding and technology (LiveTrade is not a broking operation, but owns all the stock that is available for trading).

“One of the major questions we have in our group is how can we better understand the fine wine consumer’s habits and expectations,” Bizot told the drinks business at the start of this week.

Continuing, he said, “Although we have always tried to do this, it is difficult for us, because we are selling through independent agencies or wine shops and restaurants, so we are not directly connected [to the consumer].”

“It is important for a fine wine company like us to understand the expectations among the end users of our wines,” he added, reminding db of the range of SJB wineries, which include Bollinger, along with Champagne Ayala, Burgundy’s Chanson, the Loire Valley’s Langlois-Château, and Cognac’s Delamain.

Due to SJB’s investment in BI, which Bizot describes as “strategic”, his company will get first-hand information on buying trends and global fine wine trading patterns.

“I won’t have access to who BI are selling to, but I will be able to see the evolution in sales of fine wine, Champagne and spirits; I will gain access to the know-how of BI,” pointing out that “they have invested a lot in technology to better understand how their customers are buying.”

Such information is important for SJB because Bizot believes that these customers are looking for more than just a delicious drink, but an “experience”.

“Consumers buying a bottle at £200 want to know what is around the wine, they are waiting for an experience, and we want to understand their needs,” he explained, before telling db that SJB will be investing in oenotourism at Champagne Bollinger and other wineries within the group.

However, before embarking on such projects, Bizot wants to “understand their habits and their needs, so we can adapt the experiences we will offer them; this is more about learning from them, and what they are expecting”.

For BI, the injection of capital provided by the SJB investment will allow the merchant to expand its LiveTrade platform, which guarantees liquidity on 500 of the most traded fine wines.

Head of marketing at BI, Giles Cooper, told db, “Because it is a dealing platform, it requires capital – we are the bid, we are not bidding on behalf of others, so the amount we are able to hold represents the amount we are able to sell.”

However, this does require BI to hold “a high value of stock”.

Also, he said, “We also want to grow the platform, which will require investment in technological advances.”

Finally, Cooper told db that he doesn’t believe BI customers will be nervous of a wine producer taking a share in a wine merchant.

“We don’t see how this [shareholding by SJB] will change our approach, but we’ve taken this move very carefully, and it takes lot of soul-searching to check that you feel comfortable that our relationship with our clients is solid and what we do represent their best interests as some of the biggest and most conscientious collectors in world,” he began.

“This is not something we have taken on lightly and with any supplier, but with an organisation of quality, heritage and reputation, and one that is making fine wines in limited quantities, so it should be of enormous comfort to our customer that an organisation of the calibre of SJB has taken this strategic opportunity.”

Meanwhile, Bizot added, “It is a minority investment – BI is independent – and will remain independent.”

Continuing, he commented, “We would never buy this business, because it is not our business.”

Finally, db, aware from previous discussions with Bizot that SJB is a cash-rich business that is willing to make further investments in the production side of the wine industry, asked him why the holding company has not made further acquisitions of producers since taking a majority shareholding in Delamain Cognac in 2017.

“Now I’ve done this [the investment in BI], my real point of interest is to grow our family business, to acquire vineyards, and that will be my main area that I will be working on now.

“We have to grow, and that could be with vineyards or with wineries… In 5-6 years, we will talk again, and we will have done more.”

For further detail on SJB and Bizot’s strategy for the company, you can read a full interview with the chairman, which was published by db in May 2017, and can be viewed by clicking here.