Increasing numbers of English wine producers are successfully taking their wines onto the global stage. Building a sustainable export business early can help to mitigate from future concerns over the saturation of domestic markets but as the category remains small how can producers find rapid routes to market and develop long-term partnerships?
Vineyard caught up with Red Johnson at the Hampshire-based British Bottling Company, the largest exporter of English wine working with Bolney Estate, Camel Valley, Digby Fine English, Hattingley Valley and Hush Heath, to find out more about tapping into the global wine scene.
Wine to spare
Whether you have an in-house sales team capable of establishing an export offering or look to work with a bolt-on team such as the British Bottling Company, being set up to trade internationally is paramount. Producers looking to export should consider their overall business objective, why they want to export, the volumes of wine they have to work with and the markets they expect to be targeting.
“Producers need to look at if they have enough wine to spare,” said Red Johnson founder and CEO at the British Bottling Company. “Our producers are making between 150,000 to 250,000 bottles of wine per year. Exporting needs scale because it is not worth sending 10 or 20 cases when taking into consideration the paperwork and transportation.
“Transportation may become easier as the scale of UK export increases. For instance, it is almost impossible to book refrigerated LCL shipments out of the UK. You either book a whole container or for some markets we will ship to France where it will be consolidated with stock that the importer has bought from other winemaking regions. The only place where is enough volume to be shipping full containers to at the moment is the United States of America.”
The right partners
Developing relationships and selecting the right importers can be time consuming but researching who is the most suitable in the markets you are looking to target will pay off in the long term.
“The hardest thing with export is finding the right partners,” said Red. “You don’t want to be sending your wine to the first distributors you come across. We are in 25 different markets and in each of those we have found and selected the leading wine distributors to work with. It is important to go and see them and if you are going to have a growth business you need to make sure the companies you are dealing with can support that.”
In terms of end sales, processes are not too dissimilar from working with a domestic distributor and importers should take on the financial risk and obligations, being responsible for getting your stock into that market. When it comes to effective marketing, however, producers should not expect this to be left to the importers. They need to be prepared to invest time and funds visiting their global markets, and having a member of the team who is capable of putting together a good trade visit is vital.
“Wine is very personal, and people are accustomed to meeting the winemakers,” said Red. “Trevor Clough from Digby will visit America around four times per year because the brand is growing very strongly out there, but you need to be able to make that commitment.”
Investing in the future
It is no doubt that producers will be making significantly less money exporting than selling direct from the cellar door, but producers should also expect to receive much less than working with domestic trade as paperwork hours, shipment costs, importer’s margins, and retailers’ margins will all need to be taken into consideration.
“Producers need to question if the opportunity is big enough to warrant the investment of time, energy and money required because for many these figures just won’t stack up,” said Red.
“Exporting is an investment. It is about getting the brand out there, looking towards the future and getting established early before the export market fills up. It is very hard to look 10 or 15 years into the future and gauge what the international business of English wine looks like, but there is potential and for those producers who have scale and are established in the UK, now is absolutely the right time to be doing it.”
Where to go
When it comes to selecting which markets to target, using already available analysis can go a long way, for instance looking at which countries buy the most Champagne is a good place to start. Researching which countries have a reasonable British diaspora or ex-pat community can also be lucrative too. It also doesn’t hurt to choose to export to somewhere you don’t mind visiting because you will end up going there quite a lot.
“America is currently the best place to go but not because of ‘British Royal’ connection,” said Red. “Their wine culture is very exciting, open and curious. They like to try new things and are not afraid to spend money on a good bottle. There are plenty of boutique Californian wine companies who are selling wines for $300 USD a bottle which no one has ever heard of and if that is the case buying a bottle of Hush Heath for $39.99 USD doesn’t seem such a stretch. America is the number one market by a long way.”
A new category
Despite a general increase in interest for English and Welsh wine across the wine loving community in most markets, demand from the general public is still small.
“It is a very new category so when you get one or two English sparkling wines popping up on the lists of Dan Murphy, the biggest wine retailer in Australia, it is seen as a novelty,” said Red. “Wine lovers will want to try English sparkling and ex pats will buy some too but to get to a point where the mainstream or semi-mainstream buying it is a long way away.”
However, as a category, sparkling wine is accelerating in popularity faster than it ever has in history, people are more curious about new wine growing regions and there are more new boutique categories of wine starting up. These factors are all working in favour of English and Welsh wine exports and it is very fortunate that the English wine industry matured at a time the export market was ready for the category.