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Wine Business in for a rude awakening. |
Wine distributors see a shift by the consumers to lower-end wines--bottles costing not more than a few dollars, since imports from all over the world deliver good quality. The high-end wines must be sold per bottle by the distributor!!! What a distribution nightmare! The standard practice of sending sales reps out in suits, and having them let every restaurateur taste-test a selection of wines, becomes too expensive for the distribution channel when the profit margin per case of wine has fallen so low. The bigger wine brands must constantly lower their prices to keep up with the cheaper wines. They have to keep their volume up so that their Nielsen ratings stay up. The day the ratings go down, major retailers stop carrying their product. Finding a wine-liquor store with over 3,000 different brands of wine is not a problem in most markets. 80 % of these brands are taking up a lot of shelf space and just gathering dust. After 5 years of adding more and more wines, some retailers are starting to understand this and are dumping the wines at give-a-way prices, or asking the distributor to take them back! This is a financial nightmare for these distributors. In another 3 years, when their vineyards are ready, China will start dumping wine bottles at $ 2.00 retail. Modern technology guarantees decent quality. After all, making wine is extremely easy. And the killer of all: today, the cheap drunk drinks wine instead of beer! $ 2.00 wine bottles have more alcohol than a six-pack of major brand beer, and don’t need to be kept cold. The image of the wine drinker will be the bum on the street-bench! Oh My God! |