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In a bid to become a sizeable wine player and assert its position in the overall Indian wine industry Fratelli had formed a strategic alliance at the start of this financial year with the import firm of Frinewinesnmore (FWM) to diversify and expand in the marketing of imported wines as well. This was construed as a possible step to take a majority stake in the firm that has also been their distributor for Mumbai since inception and continues to do so even today.
Reiterating that the earlier business deals and plans were discussed between the two at the time of forming a strategic alliance, Dharti Desai informed delWine that she had decided to keep full control of FWM which would focus on the retail shop, the adjoining tasting room and the FWM Direct B2C business which encompassed retail sales by holding various tasting events which would draw more focus on the corporate events. She has already been focussing on pop-ups at her retail store tasting room successfully.
Her FWM will continue the distribution of Fratelli domestic wines in Mumbai as before as well as the new imports. She has passed on the import business completely to Fratelli with a majority of overseas producers and Fratelli agreeing on mutually acceptable terms. Fratelli had entered the import business a few months ago in a small way and has ordered wines from popular labels like Zardetto, Calaterra etc recently and is planning to launch the imported wines officially in November when most of the new labels have arrived. Dharti confirmed to delWine that she will continue to be a wholesaler for the wines imported by Fratelli in Mumbai and even stock them in her retail showroom though she concedes that the percentage of such imports in her portfolio would come down from the earlier 50% to around 40%.
Dharti who is an NRI and runs her own Direct Marketing business in New York before she came back to India to start FWM, will continue to live in New York and do her existing business. She says that she will continue to visit India for a couple of weeks every quarter. ‘I have a solid team that can look after the business when I am not here. We talk to each other on Skype regularly anyway.’ She adds that she did not find that her experience with Direct Marketing found much resonance with imported wines and she was not happy handling that part of the business in India. She is pleased that she has been able to square up accounts with all her overseas suppliers before closing business with them and that there has been mutual understanding between Fratelli and producers of some good labels that were fast moving in the Indian market, to continue selling in India through Fratelli.
A shrewd business woman she took a wine and beer retail license and in an adjoining room which she calls Tasting room, she takes daily license for tasting and conducts the tastings with wines sold through the retail outlet. For instance, if Mercedes Benz wants to do a wine tasting event with her she can take the daily license which costs Rs. 1000-2000 only and do an exclusive event for them.
She continues to share her old office space on the earlier terms with Fratelli staff which moved in around April-May when the alliance began. ‘It makes sense to have common resources to cut down the costs and increase efficiency of the operation which people in India are generally scared of,’ she insists. The whole of Fratelli Mumbai staff has moved to her place of business, apparently on rent- warehouse included. Similarly Craig Wedge who has been the COO of FWM will have a double role as the Brand Director and will be shared by both according to the earlier agreement. He shall spend most of his time in Mumbai helping FWM with tastings, corporate events etc and at the same time work to help promote Fratelli imports and meet strategic clients for the promotion as well as the high end domestic wines.
When I called up Kapil Sekhri whom I had met a couple of days earlier in Delhi, he was at the winery in Akluj but was quite open and frank about this deal falling through. Confirming what Dharti had told me, he said he respected her decision since Direct Marketing was her core strength. Making and selling wines being their core strength and a major part of their strategy, they would rather focus on those and have Craig and FWM help in that direction.
Assisting her with the tastings in the tasting room will be Craig Wedge who continues to be the Brand Director promoting both the BIO and high-end domestic wines for Fratelli and will be shared both by FWM and Fratelli. Fratelli would import the products directly on their own name and are working with Elite as ( Anil Malhotra and Nitin Verma group) distributors for Delhi.
It looks like the Phase 1 of the strategic alliance between Fratelli and FWM is complete as envisaged earlier and reported in delWine but the Phase-2 has been called off with mutual understanding.
Subhash Arora |