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Viña Santa Rita extends strategic direction from UK to Asia with new Chinese distribution deal

Published:  07 February, 2017

Viña Santa Rita is aiming to capitalise on the growth of Chile in the international off-trade as it prepares to gain further traction in China - its largest export market.

Top Chilean brand Viña Santa Rita is partnering with COFCO W&W International Co Ltd in a deal which will see the brand distributed by COFCO's wholesale channels across mainland China.

This comes after the brand - one of three which comprise Santa Rita Estates (SRE) - announced a change in its route to market for the UK off-trade with a Bibendum Plb distribution deal.

China gained significant importance for Viña Santa Rita last year when it became the largest export market for bottled wines from Chile.

Six years ago, China had an 8% share of exports of Chilean wine, but that is expected to rise to 24% for 2017, ahead of both the UK and the US.

The deal marks a strategic move for the brand in China away from a previous focus on the premium on-trade to more off-trade and more mainstream-focused ecommerce channels.

This will bring the overall strategy for the brand in line with that in the UK - signalled by the Bibendum Plb deal - which aims to captilise on the growth of Chile in the off-trade last year.

Previously, Santa Rita was distributed from ASC in China, but parted ways in November in order to pursue the new direction.

The new strategy also focuses on the potential of ecommerce platforms, including leading Asian platform Tmall by Alibaba, on which Santa Rita already has a store.

The Alibaba Group is the biggest ecommerce platform in China.

While wine consumption in China is small, it is growing thanks to a middle class population which is increasingly drinking wine.

The market is also helped by an increase of premium pricing compared to countries like the UK.

Today the brand said COFCO was "a pivotal company linking China with the international food and beverage markets" and that the partnership would create an "exciting platform" to deliver further growth.

Andres Lavados, CEO of Santa Rita, added: "Viña Santa Rita have enjoyed a steady growth in the Asian market, but working together we aim to significantly bolster our sales and capitalise on the many opportunities available in this fast-paced market," he said.

"The association with China's leading premium wine distributor aligns to our goal of establishing Santa Rita as a major, relevant consumer wine brand, as reflected in the recent partnership agreement made between Santa Rita 120 and Arsenal Football Club."

The COFCO deal will see Santa Rita partner with China's largest oil and food importer and exporter in China and a leading food and beverage manufacturer.

More recently, COFCO specialises in premium imported wines, specialty beers and imported spirits also distributing wine brands including Antinori, Faustino, Penfolds and McGuigan.

COFCO also owns the leading domestic wine brand in China - Great Wall - as well as Chateau Viaud in Bordeaux.