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The U.K. market and Bordeaux en primeur

After racing around Asia for a few years I was given an additional assignment by my PDG, or President Directeur General at the office in Bordeaux. My mission: the U.K., a slightly more mature and sophisticated market than the back alleys of Taipei.

With some trepidation I made appointments with about 14 of our clients, which included some of the largest national importers/distributors, regional merchants, mail order companies, prestige retailers, monstrous supermarket chains, specialist traders in crus classes, and more. We sold about 20,000 cases a year in England, mostly petits chateaux but also crus classes.

The meetings often followed the same theme. The client’s welcome was not usually quite as gracious as in Japan, shall we say. In Japan I was a wine god. In the UK I was from Bordeaux, and therefore categorically the enemy. There is an immensely strong love/hate affair between the UK trade and the Bordelais.

After being seated, and being sized up by my opponent, the barrage would begin. Why hasn’t your PDG been to see us for 4 years? I suppose you don’t care about the UK market anymore now that you’ve found markets in Asia? Your new prices are ridiculous. Why does order preparation take so long? Why did you tell us we had a 300 case allocation of half bottles and then suddenly say you were out of stock?

And all I wanted to reply was BECAUSE WE’RE FRENCH! You see there is a massive difference in the way the French brain works compared to their anglosaxon counterparts across the channel. And nowhere is this more evident than during the en primeur campaign. It just might go like this.

Monsieur Le PDG sits in his prestigious Grand Cru Classe on a Tuesday having a 2 hour lunch. There is a beautiful 4 course meal served by his staff along with a few vintages of the properties Grand Vin. He lunches with a major negociant, and they discuss the upcoming en primeur campaign. It is very formal, very polite, and very civilized.

The British, who believe they run the world trade in Bordeaux Grands Crus, are firing warning shots at the chateaux through Decanter magazine and social media. They say that if prices don’t come down significantly then they will simply refuse to buy. The Brits draw a line in the sand. The gauntlet is thrown down. Key British critics say that Chile makes just as good quality top wine, and that’s what they will buy from now on – so there. The Brits are bitter, and rightly so, that their 2009 and 2010 wines are worth less than they were at opening, and a ton of their clients are furious. They feel like they’ve been stung by the Bordelais on far too many vintages.

Back at lunch at the Bordeaux chateau there is a brief discussion about what les anglais are saying, and although the message does get across, it is typically not heeded. The negociant, eager for allocations, compliments the chateau owner on this latest vintage, adding that he will be able to sell it. “There are other markets in the world, not just our old friends in England” the negociant says with a wry smile.

For the chateau owner the Tuesday lunch is as good as ever, his wine is far better than in Chile, and the bank account is fully loaded after the 2009 and 2010 campaigns. And so at the end of lunch the chateau owner quietly decides to himself that he will release his wine at a similar price to before, maybe with a small reduction as a token, but not too much of a discount. And as for the Brits, they’ll just have to throw another tantrum.

The fact is that although selling out en primeur is the end goal for the top Bordeaux chateaux they really don’t hurt too badly if they have to stock the wine for some years themselves. It is actually astonishing how much stock they often have of back vintages which they hold on to for their library, and to liquidate if they need a little cash injection.

Fair enough, the 2013 en primeur campaign was a bust for most of the chateaux and they are sitting on large stocks. But at the end of the day they would rather do that than cheapen their brand by discounting too much. The global thirst for the best Bordeaux will slowly eat up their inventories. And sooner or later, there’ll be another vintage of the century! Alors!

The psychology of tasting in Taiwan

In 1994 the Taiwanese had suddenly fallen in love with red wine and there was an explosion of new importers. There was a buck to be made and suddenly everyone was in on the game.

For us this made life both easier and more difficult. It was easier because you could meet dozens of potentially interested importers who might represent you, and more difficult because most of them had no experience in wine. Inevitably some of the meetings were a total comedy.

On my first mission, as the French call it, I went to see a company who had just made the decision to import wines and I was about the first supplier they had ever met. Lovely people, very kind, warm and welcoming. Hospitality was always so gracious. But the meeting quickly went sideways when we got to the tasting.

In Bordeaux I had seen the owner do a tasting with one of our UK importers and he simply opened the wines and let him taste, not saying a word until after he was done. I thought this was very impartial and allowed the taster to make a true judgment of the wine quality. So I adopted the same technique.

My new Taiwanese friends looked at the mysterious red liquid as I poured them all samples. I formally stated the name of the chateau, and did not say anything else. They picked up their glasses, did a cheers, and then tasted my young red Bordeaux. The facial contortions that followed were something to behold as the tannin ripped through their gums and the acid pierced their lips. Tears were welling up in the ladies eyes, and then after the owner somehow managed to swallow he blurted out “SO BAD. I feel like something die in my mouth”.

This was not the feedback I was used to and I didn’t know whether to laugh, be insulted or reply that I’d never let you represent us so ciao. But I realized that it was all new to them, and it was my job to try and explain and educate so that this company could understand wine, just as people had explained to me.

So for the next wine I took a different tact, one that any savvy wine salesmen would take. I refrained from pouring a sample until I had given them an explanation of the chateau, the region, the grapes, the scores, the flavours and thrown in a nice story “You are going to LOVE this wine. It’s one of my favorites. I live in the top left bedroom of the chateau on the label and its my home”. I think I put some extra emphasis on the fact it was my home…

Sure enough, although there was even more tannin, they loved it. And how could you not? There have been several studies on the psychology of tasting which typically imply that if you tell someone that they are tasting something then they will believe you. And there is definitely some truth to this with many wine drinkers, but not all. The studies usually tell the tasters that the table wine is a Grand Cru and vica versa and it fools most people.

But in my experience I am convinced that the vast majority of wine drinkers can actually tell quite a lot about a wine, and that the human being has an innate ability to tell if something is pleasurable or not. If there is a bad smell then we can tell. We’re basically built that way.

That said, if you are told a nice story about the wine that you are about to taste, including some type of intriguing inside scoop, along with some big scores, some delicious sounding flavours, and you are shown a pretty picture of the estate then the taster already has a pre-disposition to being positive about the wine.

As was usually the case at these 2-3 hour meetings we tasted all the wines and had some good discussion. I had already decided that this company was not the right choice for us because we needed an experienced importer. As it drew to a close the owner looked at me and said, “We like the red wine from the place where you live, but can you ask them to make it sweet.”

New frontiers, Jakarta

All of our European and North American importers were established companies that were usually very traditional family owned businesses. And without exception they were all run very professionally by serious wine people. We had some of the very best importers in the world, famous companies, also representing names like Guigal, Jadot, major Champagne houses and so on. As such we were accustomed to a style of business that was very formal.

So when a garbled fax came through one morning with a large order from someone in Jakarta that we had never met, well a trip to Indonesia was tagged on to the usual 6 country Asian bullet-speed tour. It was to be the first and last trip there.

I was met at the airport by our new client. As is often the case he had a driver so we both sat on the back seat and started to talk. Traffic was bad and we crawled along. Before long we got into the heart of our business discussion and the importer started with a whole string of increasingly ugly requests.

Asking for a discount was one thing, demanding longer payment terms was another, but my eyes bulged when he told me we were both going to a meeting where he would bribe a major Buyer for a major major major Corporation to list our wines. And simultaneously as he came out with all this, at a red light, a teenager slapped the centerfold of a pornographic magazine against the car window, trying to make a sale. It was very graphic. I didn’t know where to look and the importer kept talking like nothing was happening.

This was not like an average day in London seeing Farr Vintners. We’d already been paid for the order he’d placed and so I politely said we couldn’t meet any of his requests and I wouldn’t participate in bribing anyone and that if he wanted to have lunch then great, if not, I think we’re done. It was very uncomfortable.

The issue with emerging markets is that you can waste a lot of time and money trying to build them. Sure, there are always some good importers but there are a lot of cowboys too. There are often other issues like counterfeit wines en masse, containers being left on the docks in 35 C heat for weeks causing the wine to literally cook, and all kinds of funny business dealings.

True, in London you talk about the weather a lot, the formalities are so very British, and you have to listen to them howl about the price increases during the en primeur campaign (can’t blame ’em). But there is alot to be said for the traditional markets. Wineries that neglect them in search of the Asian golden goose should think twice. China, the focus for many Bordeaux chateaux, has already had a bumpy road, and it’s likely to have more turbulence ahead.

The Hong Kong wine market & the Commanderie de Bordeaux

I lived in Hong Kong for 16 years. For another 10 years after that I went there to sell Bordeaux wine. I love the place. It will always feel like home.

Today, it’s the hub of the Asian wine market. It’s home to a large number of incredibly sophisticated consumers. And these wine lovers can have massive spending power. Yes, Hong Kong has become the capital of the fine wine auction market and the sales results are off the charts. Did I just read that someone spent almost US$480,000 on 12 bottles of DRC? There’s a saying “only in Hong Kong”.

Consumer wealth takes on a whole new meaning in HK because people live to work, they live to make money, and then they spend it lavishly. Expensive cars are the norm on the streets, mega-yachts adorn the marinas, and the ladies that lunch look like they’ve been decorated for Christmas. Sparkle sparkle… and surely a good girl deserves a $16,000 Hermes handbag under the tree, right honey?

I was very fortunate to make an agreement with a fantastic HK importer back in 1994, that still lasts today. But to woo this company we had to put on one of our fancy events, showcasing 40 year verticals of our own chateaux. But when you don’t have a good contact network in the local trade, and you’ve no idea who the movers and shakers are, then you need to find someone to help you. So I contacted the Grand Maître of The Commanderie de Bordeaux, HK Chapter.

The Commanderies have been set-up by the CIVB in Bordeaux (the HQ that oversees everything) with the mission of promoting the regions wines. There are many Commanderies around the world, in a lot of major cities. The people that run these satellite “chapters”, like the one in HK, do it for free, because they love Bordeaux wines. The Grand Maitre is usually a successful businessman who knows the Bordeaux chateaux very well and visits them every year for his personal interest. Its basically his hobby and pleasure.

If you contact the Grand Maitre they will often take the time to explain the market, give you tips and contacts details of the key players, make some calls on your behalf, and possibly help organize an event to assist you to market your wines. And so we did. The Commanderie gave us a guest list of media, importers and influencers and we put on a stunning tasting.

But there was one issue with getting people to come out to our event in this bustling metropolis, which was diplomatically broached during the event planning lunch. The Grand Maitre leaned towards me and said, wincing, “some people simply won’t drink anything unless it is a 1st growth. Lafite is their house wine. Any chance you could bring some of that too?”

And so we did, and people came, and we got our importer, and then a few more importers in the years following that. And it was largely thanks to the Commanderie, which is an excellent organization and a superb model that other wine regions should consider following more seriously.

In the last 20 years, since the import tax on wine was dramatically reduced in landmark legislation, the number of importers has exploded. The range of wines on offer is huge. The wine lists at the top restaurants are as thick as bibles and there is a thirst for the very finest vintages. There are more WSET schools on this small island than in most large countries, and combined with China is does the largest volume of WSET exams in the world after the UK.

There are 2 resident MW’s. My pen pal and superstar Debra Meiburg, who is the most amazing woman that I’ve never met (except for 10 seconds at our MW graduation the same year). And then Jeannie Cho Lee, whose productivity is startling. Singapore Airlines, Decanter, books, etc… you guys make me feel lazy. Take a holiday guys!

So Hong Kong is one of the capitals of the wine world. And it’s all set to continue to get stronger and stronger as time goes on. And that’s why we started a wine industry recruitment site there, just in case you want a job