1. Home
2. News

Looking Back, Forging Ahead Q&A: John Colley, Majestic Wine

How has business been for you in the first half of 2023 and how do things compare to where you were last year? 

We’ve carried strong trading momentum into this year following our second-biggest Christmas ever, and our sales are in-line with where we hoped they would be at this stage of the year. So from that perspective, we’re really pleased with the first half of 2023.  

• Read more: The Wine Society trials recycled plastic bottles
  

But we know it’s an incredibly tough market out there. Consumer spending is under even more pressure than it was this time last year and shoppers are carefully considering every single purchase they make. What’s clear is that our customers continue to place huge value on the quality of our products, the expert advice they receive from our expert colleagues, and the in-store services we provide like free tastings and glass hire.  

It’s more important than ever that we focus on those unique differentiators and continue to deliver the best possible service, experience and value for our customers during tough times.

How has the cost of living crisis played out across the year and what – if anything – have you been able to do to mitigate that? 

Unfortunately, I think we’re still yet to see the impact play out with interest rates continuing to rise and many households still yet to move off of low fixed-rate mortgages. But against that backdrop, we have been fighting hard at Majestic to keep prices low for both our retail customers and the hospitality partners we supply. 

We have one of the best buying teams in the business, who have won two major awards this year alone and have incredibly strong relationships with all of our suppliers, from major brands to smaller family producers. That means we are in prime position to continue doing what we have always done: source the best quality, unique wines at the lowest possible prices for our customers.  

Our teams have also achieved some incredible work this year launching our new Chosen By Majestic range, designed to help customers on tighter budgets discover fantastic new wines they will love. We launched the range in June with 11 wines from across Europe, and we will expand that further through additions from the Southern Hemisphere later in the year. Our buyers tasted more than 1,000 wines and worked closely with trusted suppliers on blends that over-deliver on their sub-£10 price points. Given the current rate of inflation and looming alcohol duty increases, these represent superb wines at unbeatable value.  

What are you most proud of achieving this year? Have you managed to achieve any specific goals? 

There are a number of things I’d call out. Firstly, we hit our sales and profit targets for 2022/23 at the end of our financial year in March, and we grew market share. Considering those targets were set prior to the war in Ukraine or the cost of living crisis, that represents a monumental effort from our colleagues across the business, and I am incredibly proud and thankful to everyone for their ongoing hard work and dedication to Majestic. It’s incredible to think in 2019 we were closing stores and losing customers. 

I’m also really proud of what we’ve been able to do for our colleagues this year. Our people really are our biggest asset at Majestic and so we were delighted to introduce a new pay deal in April that better rewards our store teams for their long service, WSET qualifications – cementing our leadership position as a retailer with the most qualified experts – and the size of the store they manage, through new salary increments. Our owners at Fortress recognise just how vital our store colleagues are to the success of Majestic and having their backing to bring in the new pay structure and help our colleagues progress further in their careers is really important.

And what is the biggest cause for concern? 

I alluded to it earlier, but for me, the big concern is the further squeeze on consumer spending that we will see later this year and how that impacts the market. Some economists are suggesting the Bank of England base rate could hit 7%, so that will have a further impact on household disposable income.  

Then you add the alcohol duty increase into the mix, which will inevitably lead to increased prices, driving further inflation for our retail customers and the thousands of pubs, bars and restaurants we supply in the on-trade. That’s going to deal another hammer blow to a fragile hospitality sector that is still recovering from the Covid-19 pandemic, and have an impact on inflation at a time when the treasury is trying to bring rising prices under control. So there is huge uncertainty around how consumer confidence and spending will fare over the next few years as all of that plays out – that’s going to be a concern for any retail business.

What are the biggest drinking trends at the moment, and how do you expect that to change going into the autumn? 

There are a couple of things I’d mention. The first is the shift towards people buying less but better quality wine. I think there’s a recognition, particularly as duty rises, that spending a bit more on a bottle of wine means you are investing in the wine itself, not on tax or packaging. The great thing about Majestic is that we have expert store colleagues and a depth of range across all categories, which provide our customers with the knowledge and the confidence when they need to trade up.  

We’re also seeing good growth in off-the-beaten-track regions like Greece and Austria. We have wines from both of these countries in our new Chosen By Majestic range, which is a nod to the fact that our customers are increasingly seeking to discover new varietals from regions that can deliver amazing value for money.

Is Covid now a distant dream, or are you still seeing lingering effects? 

There are without a doubt still a few hangovers from Covid. I think the one that’s still having the biggest impact is the contracted labour market in the UK. Recruitment of great colleagues in terms of securing the right calibre of people is still not the way it was pre-Covid. 

Obviously post-Brexit and during Covid we saw a lot of European nationals return to their families abroad, and in the pandemic, a lot of people in their 50s or early 60s stopped working and never returned to full-time employment. That’s taken tens of thousands of people out of the labour market, and so attracting the right talent to Majestic – with the skillset and values that we look for – is probably as difficult as it’s been during my time as CEO.

Any predictions for the second half of the year? 

If I could predict what was going to happen I would probably have retired by now! What I am certain of is that we will continue to do what we do best at Majestic: provide our customers with the best quality wines, the best range, the best service and the best value for money. It will be a turbulent second half of the year – and probably a turbulent few years after that. But we have a proposition that has time and time again proven its brilliance and resilience – and I’m confident that it will do so again.

Quick-fire questions…  

Old World or New? 

Old 

Cocktail or slow sippin’ spirit? 

Slow sipping spirit  

Vermentino or Vermouth? 

Definitely Vermentino 

Lo or No? 

Lo 

Three-star or bistro? 

Bistro  

Desert island tipple? 

Margarita

• Majestic
• John Colley