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Safeway to Argentina

Published:  23 July, 2008

Carlos Criado-Perez, the former Safeways chief executive officer, along with two other former Safeways executives, will be using the forthcoming Wines of Argentina annual trade tasting (20 September) to unveil their new venture - Las Bodegas, a specialist wine importer and distributor majoring on putting more Argentinian wines on the shelf'.

Des Cross, Safeways commercial director before Wm Morrison took over the multiple retailer, is CEO of Las Bodegas, while Jack Sinclair, the ex-Safeways managing director, is non-executive director. Cross told Harpers: 'During our time at Safeway the three of us had worked quite closely together and found that we got on well. As a result, we decided that we should keep the working relationship going by starting a joint project.

'We decided that our significant retail background (Carlos is ex-Safeway, Wal-Mart, Makro and others, while Jack is also

ex-Tesco) combined with the fact that Carlos was originally from Argentina must give us an opportunity,' said Cross.

'An analysis of the wine industry showed us what looked like a significant opportunity. Argentina is fourth-/fifth-biggest wine producer but with only 1% UK market share compared to its smaller neighbour Chile, at more than 6%. That missing 5%, or more than five million cases, was too good an opportunity to miss for a group of retailers,' Cross explained.

The trio employed Matthew Stubbs MW as a consultant and took him to Argentina to advise on selecting producers. Cross commented: 'The list includes the oldest winery in Argentina (Benegas), which was the original owner of Trapiche, and probably the most famous (Dominio del Plata). The list also includes sparkling-wine producers, an area where, we believe, Argentina is most underrepresented.'

Cross is critical of the pricing policies of many suppliers. He said: 'Our objective is to work with and develop sales of top-quality wine producers across all price points and all sales channels. We want to drive volume through a fair pricing policy. While volume will always mean the big customers can get price savings through lower unit-distribution costs and economies of scale, we see no reason to do what many in the trade do and give smaller retailers and on-trade customers significantly worse prices while rubbing their hands at the profit and at the same time complaining about the power of the large multiples.

'Our sales are growing rapidly and we look forward to continuing to introduce more of the public to the adventure that is Argentina and help revolutionise the perception of their wines. Las Bodegas Viva la Revolucin!' he quipped.