Is the UK wine market still the best in the world?

Published: 23 July, 2008

It was once a truism that even the most ardently Anglophobic producer would not have disputed: though it was never going
to lead the world in terms of production, the UK was the most dynamic, most diverse and most influential wine market in
the world. More than that, it was both the spiritual home and the shop window of the global wine trade, the place where the reputations, styles and sales of the world's wine production were made and broken, and where the world's most knowledgeable merchants and consumers gathered to discuss, buy and drink the results. Forget New York - when it came to wine, if you could make it in London, Bristol or Edinburgh, you could make it anywhere.

John Soutter, Cassella Wines

How long have you been selling wine on the UK market?

We started selling into the UK in 1999.

What changes have you seen during this period?

Sometimes it's scary the changes that have happened in the UK, all in favour of somebody other than the producer. We see it as more and more difficult to get a listing with a multiple national grocer, as they continue to (a) consolidate, (b) streamline the number of suppliers they have for the sake of efficiency, and (c) continue to demand higher margins so as to improve their bottom line and compete with other supermarkets.

The choice consumers have of producer has diminished as it becomes increasingly difficult to get accreditation as a supplier. The consumer continues to benefit from great value-for-money wines from all over the world, albeit at the cost of choice. Consumers have been trained to buy when on promotion', and that becomes a challenge when trying to build a brand. The retail price for Aussie wines has not progressed in line with costs, since producers continue to be asked by supermarkets to absorb CCT and duty increases - all UK-levied taxes.

The UK trade used to be referred to as the best wine market in the world. Is this true in your opinion? How is the UK market viewed in your country?

Yes, it is true that the UK used to be referred to as the best wine market in the world. As a producer, our experience is a little different, since we are biased by first having success in other geographical markets, and we are now trying to grow our business in the UK. Many of our Australian competitors did it the other way around. I believe the UK market is now considered one of the hardest markets to infiltrate and, certainly for our company, one of the lowest-margin-generating countries.

That being said, if one is to have a worldwide wine brand, you must have good distribution in the UK. We, as a business, want to continue to grow our UK business and will be working diligently over the coming years to achieve that position. The heady days of 50% pa growth are over; however, exports of Australian wines to the UK continue to grow, from a larger base, and we intend to work hard to try to gain our share of that growth.

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