China sales up 30% for Bordeaux négociant

Bucking a trend seen among many négociants in the last 12 months, Maison Sichel has enjoyed a rapid rise in Bordeaux sales to China during 2013.

While mainland China has suffered a slowdown in sales of top-end Bordeaux since the country’s new Communist Party leaders were appointed at the end of 2012, Maison Sichel has actually seen a 30% rise in sales to the country over the last year.

Explaining how the négociant has increased its business in the mainland despite an overall decrease in fine wine sales, Charles Sichel, Maison Sichel’s export director cited the success of a push by his business on the less expensive end of Bordeaux.

“Since the new Chinese government tried to stop corruption using ostentatious gifts, which included cases or bottles of very fine wine from Bordeaux, the Chinese have suddenly discovered that the 1855 classification is not only for the first growths, and they have also discovered delicious cru bourgeois offering great value for money,” he recorded.

Maison Sichel, which has been shipping directly to China since 2000 and has had an office on the Mainland since 2008 (initially in Beijing and now in Shanghai), has been busy developing a market for fine wines from Bordeaux but also the region’s mid-level wines – those with an ex-cellar price between €5 and €20, according to Sichel.

This has meant that 20% of the négociant’s €42 million global turnover is now accounted for by China, and half of that business is non classed growth Bordeaux.

“After years of banging on doors our customer base has come to acknowledge Bordeaux’s mid-range,” he recorded.

“A lot of the others have concentrated on trying to patch up their cru classé business, but we have motored on with our petits chateaux, cru bourgeois and lesser cru classé business very successfully.”

Charles Sichel. Photo credit: Claude Lada

But there’s a further aspect to Maison Sichel’s expanding Bordeaux business in China, and that’s the supply of wine for private label wines sold in the mainland.

“Most wine merchants like to develop their own brands because the Chinese want complete control… and a lot develop their own brands and invest large amounts to promote them and maximise their visibility,” he said.

Continuing he explained, “This is were we come in with our Bel-Air winery, because we do a lot of contract winemaking for people in the UK and France, and now a lot of Chinese customers as well.”

As a consequence, around 35% of Maison Sichel’s business in China is the supply of own-label wines, representing about 50% of the négociant’s volume in the mainland.

As such wines are blended in Bordeaux for Maison sichel’s Chinese customers’ tastes, Sichel noted that they like “fruit” and are less inclined to ask for “massively structured or oaky wines”.

Speaking more generally to db about his experience selling wine in China, he said, “The Chinese have come in late in the wine game but they have learnt incredibly fast about the product and then how to market and distribute it.”

He then added, “It’s a massive country and we are finding new customers all the time.”