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Bulk wine: the dynamic 20×20 sector of the wine industry

Bulk wine: the dynamic 20×20 sector of the wine industry

London can lay claim to have been the host city for a whole range of events over the years from the Great Exhibition, the Olympics, the World Cup final, to the coronation of the queen, but it’s never had a bulk wine and spirits show before. Until now and the arrival this week of the International Bulk Wine & Spirits Show, no less, to the Royal Horticultural Halls. So why London and why now?

Richard Siddle
25th February 2018by Richard Siddle
posted in Opinion,

Bulk wine and spirits? Really? What’s that got to do with me and my premium range of drinks for restaurants, bars, pubs or hotels? Well, read on and you find out why the world of bulk is quietly, but surely taking up more space on importer, distributor, and restaurant and pub group wine and spirits’ lists.

Go on then what’s all this about…bulk wine and spirits?

The clue is in the word bulk. Rather than make and bottle up wine at source, at the winery, or local bottling plant, more and more producers are choosing to leave that part of the business to the final destination and instead send large volumes of wines in flexitanks, by ship to all parts of the world to be bottled in market and sent to shops, supermarkets and restaurants to be drunk by an unsuspecting consumer.

Yes, we all know that, but why is it important to me?
Sorry, for the Play School definition, and yes for large parts of the premium on-trade the world of bulk wine and spirits operates in a parallel universe, gobbling up more space on supermarket shelves, responsible for churning out character-less, varietal-driven wines that are drunk today and forgotten tomorrow. But before you dismiss it completely, it is also one of the fastest and most dynamic sectors in an industry that is either flat or in decline, so it deserves, at the very least, a little bit of your time.

Bulk wine and spirits have also grown up. They are no longer just about serving the £5 and below wine market and spirits poured from the speed rack in a bar. The technology behind bottled in market drinks now means wine and spirits can be shipped from one side to the other and then bottled three time zones away without affecting the quality of the juice along the way.

It means the average price points for drinks made from bulk wine and spirits are also edging up as well. Making up some of the £20 to £30 wines you will find on a wine list.

But where’s the story, the background, the hook for customers to know what they are drinking?
The hook is simple. These are uncomplicated, simple, straightforward wines for people who are not interested in the terroir, or the winemaker, they just want a good wine to drink and go with their bowl of pasta, beef burger or pizza.

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If you’re going to Byron you want your wine or beer to come as uncomplicated as the burger

If you are responsible for selling wines, in particular, to the casual dining sector then it makes sense to provide them with “casual” wines. Bottles that don’t need a grade one WSET certificate to help you order.

Yes, but where’s the beauty, the magic in that?
There isn’t any, other than the fact you are able to sell a wine that has been brought from the other side of the world, where its currency rate makes it normally uneconomic to trade with, and give customers an easy to drink wine normally for well under £20 a bottle. For restaurants strapped by rising rates, higher wage costs, and a whole load of other cost increases, being able to stock wines that move out of the door and keep the cash flowing are where there are attentions are increasingly going to.

If you come to the market with wines that are always £1 to £2 to £3 more to buy wholesale than your competitors then don’t be surprised to find yourself being locked out of certain parts or the wine list. Particularly if you are still looking to compete for house wines on restaurant, bar and pub lists. If you are then chances are there is going to supplier after supplier able to offer very similar wines at lower prices because they have been bottled in the UK.

It’s a very different kind of wine industry than the one I signed up to.

It most certainly is. This is the 20×20 sector of the global wine industry. Where you get your hits, quick and fast. It’s not test match wine for the purists. But, like 20×20 games it’s also a sector that’s guaranteed the equivalent of a full house. For not only are the end consumer apparently happy with the wines they are being served, but wineries the world over also have a ready made and growing market to sell either dedicated wines for, or to get rid of surplus, unsold wine at the end of a harvest.

The numbers involved are enormous. Not surprising when you consider over 80% of all wine shipped from Australia to the UK comes in bulk. Vast warehouses of wine that are being constantly replaced by the next shipment of Chardonnay and Shiraz.

Much of the wines shipped between France, Italy and Spain, for example, travels in bulk to be bottled and blended elsewhere. Similarly in the US. Large amounts of wine being blended by Californian producers is coming up in bulk from Chile and Argentina.

It won’t be the first thing that a winemaker will talk about when pouring you a sample, but if you stripped back every wine you have tasted this year then the chances are some elements of its will have come from bulk wine shipped from winery to winery.

OK what else?

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Some of the exclusive wines created by Lanchester Wines


It’s also a sector that, thanks to advances in technology and shipping, is the driving force behind much of the new innovation in brand development, packaging and label design. Opening up new routes to market for traditional drinks distributors and importers who are changing their business models to act more like partners and NPD, solution centres for their retail and on-trade group customers.

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Companies that will come up with the concept of a new brand, go out and source the wine and then sell in the whole package to their retail or restaurant customer to sell either as their own private label, or an exclusive brand that has been just created for them.

So why are we talking about this now?
Well there’s a bulk wine and spirits show in town. The International Bulk Wine & Spirits Show to be exact. It is the first time an event of this kind has been held in the UK with up to 1,500 visitors expected from around the world at the two day exhibition and conference taking place at the Royal Horticultural Halls.

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The Horticultural Halls will host the IBWSS event

The event is being organised by Sid Patel and his US-based, Beverage Trade Network, following the inaugural event which happened in San Francisco last summer.

But hasn’t all the bulk wine for 2018 already been traded and booked up?

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There has not been as little wine produced around the world since the days of JFK at the White House

A large part of what was available in 2017 probably has. But that’s the rub, there was an awful less wine to go around last year after the worst global harvest since the days when JFK was in the White House. The world over has seen bad harvest resulting in Italy producing nearly 90m fewer cases of bulk wine than in 2016, French bulk wine down by almost 65m cases, and Spain down by 40m (IWSR/Vinexpo).

There may be a lot less bulk wine around to be traded, but in a way it makes an event like this even more important to attend. Particularly as the 2018 harvests from the New World start to come on stream and there is more wine flowing in to the global supply chain.

There is also such a huge interest in this growing sector, one which is vital to understand if you are going to plot your own way forward through 2018 and beyond

So what can we expect at IBWSS London?

It will primarily be an opportunity to network and meet some of the 1,500 plus like minded visitors that have registered, and talk to the close to 50 exhibitors, including brokers, producers, bottlers, brand developers and consultants from all the world. Those in the know about where to find your next shipment of wine.

It’s hard to imagine an event of this type happening 10 years ago. Then most bulk wine conversations seemed to take place in hushed voices in the back corridors to traditional wine events and tastings. Bulk wine was still an enormous market, but not one that those involved were willing to talk about.

Even now bringing up bulk wine in a conversation with a leading producer is like dragging a dead cat into the room. It’s what goes on behind the bike sheds of the wine trade.

But not now. It’s big business. It’s growing. And it’s out in the open. Hence IBWSS London.

Even in the US where it is sill more under the radar than in Europe, says Patel.

“In the US there is still a lot of bulk and private label being done under the radar. It has always been there, but it is much more of a secretive industry than it is, for example, in the UK. A lot of that comes from the fact technically any retailer’s private label has to be made available for anyone to buy. But it is the fastest growing market in the US, everyone is jumping into private label as they look to take more control of their margins,” he explains.

Why London?

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The Brits may like to talk themselves down, but the UK and London is still highly revered around the world. As Patel says: “It is still very much the hub that everyone connected with bulk wine has to be involved with. It’s certainly still the gateway to Europe in the same way that San Francisco is the gateway to the US. Wineries and brokers want to come to the UK as this is where the business is being done. It’s the biggest private and own label market. Hence why it is such an important business meeting place as well.”

Visitors to the London IBWSS will be able to hold talks with major importers, distributors, brokers, bottlers, agencies and retailers.

Patel, though, also recognises he is launching a new trade show against an uncertain backdrop of raised prices due to currency exchange, the Brexit factor as well as the issue of reduced stocks after such a poor 2017 harvest.

What else is happening at IBWSS?
As well as the exhibition there is also a two-day conference programme (which can be seen here) featuring an impressive line up of keynote talks and industry debates, chaired by The Buyer’s Richard Siddle, including:

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Clem Yates MW of Off Piste Wines will be looking at how bulk wine has become a key part of retailer’s own label strategy

  • Clem Yates MW of Off-Piste Wines who will look at how importers and distributors can use bulk wine to help develop their own private label and branded wine strategy.
  • Barry Dick MW, the new head of winemaking at Copestick Murray, the brand, import and development business, will look at the best ways to import bulk wines from different countries and look at the benefits of using different shipping formats, from Flexitanks to ISO tanks.
  • Mark Lansley of Broadland Wineries, leading bulk wine bottling, but also wine development business, will look at how you can drive additional revenues by using bulk wine to highlight gaps in the branded wine and private label market.
  • Neil Anderson and Paul Braydon of Kingsland Drinks, another leading bottling, but also market insights business, will examine how it has evolved as a business to provide consumer-driven solutions to buyers and customers.
  • The Buyer will be chairing a debate between Mark Roberts of Lanchester Wines , another bulk wine branded and private label solutions provider, who will join Robin Copestick , managing director of Copestick Murray, Neil Anderson of Kingsland Drinks and Denys Hornabrook, co-founder of VINEX, in a wide ranging debate looking at the challenges, opportunities and trends within the bulk wine sector.
  • Bulk wine can be complicated. Shipping wine vast differences needs to be done right, which is why David Richardson of the Wine & Spirit Trade Association will look at the varying regulatory issues facing importers of bulk products.
  • Clive Donaldson at Morrisons will look at bulk wine from the point of view of a major grocery supermarket chain and the options it now gives it to buy and source the most competitive, quality wines.
  • Geoff Taylor of Campden BRI will look at the quality factors related to bulk wine and what big steps have been taken to improve the consistency of bulk wine.

* IBWSS London takes place at the Royal Horticultural Halls between February 27 and 28. You can still register to attend the event for free here, or pay to attend the conference at £175 for the two days, or £99 per day. The conference begins at 9am each day and the exhibition opens at 11am to 4pm.